Rhode Island Rolls Out Transparency Standards for Investment Managers

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Rhode Island Treasurer Seth Magaziner has overhauled a portion of the state’s investment policy with a series of measured designed to encourage transparency from the investment managers trusted with state funds.

Under the new initiative, new managers – including those working with the state pension fund – will have to publicly disclose performance, fees and other data.

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Mr. Magaziner’s “Transparent Treasury” initiative requires money managers wishing to do business with Rhode Island to publicly disclose information about their performance, fees, expenses and liquidity. Going forward, all fund managers will be required to sign a transparency pledge, agreeing to the release of this information before they will be allowed to oversee Rhode Island state investments.

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“Going forward, Rhode Island will only do business with fund managers that allow us to publish information on performance, fees, expenses and liquidity,” said Mr. Magaziner in a phone interview.

In addition to requiring disclosures of all new funds in which Rhode Island invests, the treasurer’s office is currently in the process of reaching out to the state’s existing fund managers to ask them to voluntarily meet these new standards for current investments. Going forward, existing managers would also be required to provide the information for new investments, Mr. Magaziner said.

As a part of Mr. Magaziner’s transparency initiative, the treasury office will begin reporting fund expenses at an aggregate level immediately and on a fund-by-fund basis later this year.

The State Investment Commission, the body that oversees state pension investments, approved the transparency guidelines last week.

 

Photo credit: “Flag-map of Rhode Island” by Darwinek – self-made using Image:Flag of Rhode Island.svg and Image:USA Rhode Island location map.svg. Licensed under CC BY-SA 3.0 via Wikimedia Commons

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