2022 marks the fifth year Colorado PERA has published its Investment stewardship Report, which highlights how PERA manages and invests the funds that provide retirement benefits for nearly 650,000 members.
Released each year following PERA’s annual report, the Stewardship Report provides insight and transparency into PERA’s investment program and its focus on financial sustainability.
PERA invests with one goal — to pay current and future benefits to members and retirees. For five years, the Stewardship Report has detailed how PERA staff serve as good stewards of assets to ensure the plan can continue to do so.
Five years of the Stewardship Report
“We manage approximately $60 billion in assets on behalf of our members; that’s a big responsibility and it’s one we take seriously,” said Tara Stacy, PERA’s Director of Investment stewardship “The Investment stewardship Report provides a great deal of helpful information on how we serve as stewards of funds, and we hope the report has become even more useful to those with questions about how and why we invest on their behalf.”
Over the years, the Stewardship Report has expanded and adapted as PERA’s investment staff have engaged with various stakeholders interested in how the organization makes investment decisions.
PERA often hears from various groups that would like to see PERA divest — or sell — certain types of investments, as well as groups that would like to see more money invested in certain industries or sectors. PERA’s approach to investment stewardship is straightforward: Seek out investments that are expected to provide the best risk-adjusted returns to PERA’s portfolio over the long term.
“A key takeaway we hope readers get from the Report is that our approach prioritizes financial value, rather than personal values, and supports PERA’s mission to provide retirement benefits while ensuring the financial sustainability of the Fund,” Stacy said.
Highlights from this year’s report
New in 2022, the Stewardship Report release includes an online digital snapshot, which provides an interactive overview of the report’s highlights and key data points.
The 2022 report also includes additional case studies, charts and graphs that help explain various investment philosophies and practices.
The report includes expanded disclosures about how the PERA Board and staff consider climate-related and other environmental, social, and governance (ESG) themes in the management of the portfolio. PERA does not manage the portfolio to target any specific ESG metric or outcome, but staff do take into consideration any financially relevant factors when making investment decisions.
The Stewardship Report now includes more information on how PERA integrates various financially material factors into its investment decisions, and why PERA chooses to engage with companies through proxy voting and other strategies rather than divesting.
The PERA Board updated its proxy voting policy in 2021, and the Stewardship Report provides insight into some of PERA’s proxy voting activities, as well as other ways staff engage with companies in which PERA invests.
For learn more about the Investment stewardship Report and PERA’s approach to stewardship, visit copera.org/investment-stewardship.
More stewardship coverage over the years:
- Burritos, Boardrooms, and Ballots: The Story of One Shareholder Proposal
- Evaluating Sustainability in PERA’s Investment Portfolio
- Investment stewardship: Considering Relevant Issues Like ESG Factors in Investment Decisions
StewardshipThe practice of overseeing or managing something entrusted to one’s care. PERA’s approach to investment stewardship is focused on ensuring the financial sustainability of the fund that pays benefits to retirees and beneficiaries.StewardshipThe practice of overseeing or managing something entrusted to one’s care. PERA’s approach to investment stewardship is focused on ensuring the financial sustainability of the fund that pays benefits to retirees and beneficiaries.StewardshipThe practice of overseeing or managing something entrusted to one’s care. PERA’s approach to investment stewardship is focused on ensuring the financial sustainability of the fund that pays benefits to retirees and beneficiaries.Proxy votingThe process by which shareholders can vote on corporate proposals without being present at a shareholder meeting.EsgAcronym for environmental, social, and corporate governance factors that can be used when making investment decisions.DivestmentThe act of selling one’s investments in a particular company or sector, often for philosophical or political reasons.
get email – I checked with empower yesterday – lost $20K
I truly believe this so DO NOT think PERA has your best interest at heart. PERA looks out for PERA and not it’s members. There is a lot they are not telling you!!! Look at inflation and their report giving members a 1% increase. Feels like they rob you to line their own pockets….
How about a decent raise for your members? Biden inflation is killing us. Put yourself in our shoes.
We certainly understand the impact inflation is having on retirees and others. The amount of PERA’s Annual Increase (AI) is set in statute and is not tied to inflation. Rather, it adjusts up or down based on PERA’s funding progress, along with member and employer contributions. These provisions are part of Senate Bill 200, passed in 2018, which ensures that PERA reaches full funding by the end of 2047. We know these changes are not easy, but they’re vital to helping us reach that funding goal and ensuring our retirees and members can continue to count on PERA to provide them with monthly income in retirement they cannot outlive.
Wow, $36/month COLA. Looks like we need new legislators and PERA personel.
What are your investments in regards to ESG? What percentage of your portfolio.
Hi Diann, PERA does not have any ESG (environmental, social, and governance)-themed investment mandates, nor do we screen our investments based on specific ESG criteria when deciding whether or not to include them in the portfolio. However, PERA staff will integrate related factors into our fundamental analysis, where financially material. As of December 31, 2021, we managed approximately 62% of the Fund in-house, with most of those assets in actively managed portfolios using this integrative approach. Our singular goal is to seek out investments that are expected to provide the best risk-adjusted returns over the long term. The 2022 Investment Stewardship Report provides more details on our financially-focused approach, as well as our resulting exposures to various themes that may be categorized under ESG labeling conventions.
Previous reports indicated PERA is on track to reach goals set out to maintain adequate funding for long range goals; no need to upset a plan that seems to be working. Everyone has been affected by the pandemic and inconsistent political actions. We cannot expect PERA to make up for past actions beyond their control.