Chicago Teachers’ Pension Fund Remains Leader among Pension Funds in Minority, Women and Disabled-Owned Business Enterprise Efforts
October 17, 2018 – The Chicago Teachers’ Pension Fund (CTPF) announced that it invested $4.5 billion, more than 41.9 percent of total fund assets, with Minority, Women and Disabled-Owned Business Enterprise (MWDBE) firms in fiscal year 2018. This represents a 9.11% increase over 2017 investments. The Fund’s work was highlighted during October 16, 2018, testimony presented to state legislators at an Illinois Senate Committee hearing on Pensions and Investments held in Chicago.
“Our total fund MWDBE assets have increased 525% since we first started tracking this data in the early 1990s. CTPF has consistently been a leader among pension and retirement systems throughout the United States, ensuring that MWDBE firms have access to the many opportunities to manage CTPF assets,” said Jay C. Rehak, President of the Board of Trustees. “Our current allocations more than double the Fund’s target and we pride ourselves on exceeding these measures and taking affirmative steps for our investment managers’ participation.”
A breakdown of assets by classification as of June 30, 2018, includes $2.77 billion managed by women-owned firms; $1.13 billion managed by African American-owned firms; $549.5 million managed by Latino-owned firms; $69.2 million managed by Asian American-owned firms; $18.5 million managed by Persons with a Disability-owned firms, and $13.9 million managed by Multiple Minority-owned firms.
CTPF has seen dramatic growth in MWDBE investments since the early 1990s when commitment to diversity within its portfolio was first formalized. The Fund invested less than 7% of assets in MWDBE-owned funds in 1994, and today the total investment has grown to 41.9%. Annually since 2007, the Fund has exceeded the goal of investing 20% of Fund assets with MWDBE firms.
CTPF invests in emerging managers through direct mandates and Manager-of-Managers programs (MoMs). Currently, the Fund has direct relationships with 29 MWDBE firms who manage 54 portfolios. The Fund has MoMs relationships with an additional 17 MWDBE firms who manage 21 investment portfolios. Managers who perform well under the MoMs program may graduate to direct mandates with the Fund. Since the program’s inception, eight firms have graduated to direct mandates.
The recently submitted report is required by a 2009 Illinois law, PA 96-006, encouraging the trustees of public pension funds to use emerging investment managers in managing their systems’ assets. A copy of CTPF’s 2018 Diversity report is available here.