ERS manages retirement trust assets of approximately $31 billion on behalf of state employees and retirees, who are the beneficiaries of the Trust. ERS manages 56% internally with the remainder being managed by external advisors. Investment returns continue to be the largest funding component of retirement benefits, accounting for 65% of the value of the ERS Trust.
ERS operates with a six-member fiduciary Board with half of the members appointed and the remaining three members elected. In addition, a five to nine-member Investment Advisory Committee (IAC) was formed to provide high level investment knowledge and insights into the investment process. The IAC currently has seven members. IAC members participate in the oversight of the ERS Trust Funds and have been recruited from the investment community.
The ERS Board of Trustees (BOT), with a recommendation from the Investment Advisory Committee, adopted an asset allocation strategy to increase investment diversity while maintaining an acceptable level of risk. ERS investments include a mix of active and passive management with an array of investment strategies. Investment asset classes include domestic and international equities, fixed income, global real estate, private equity, hedge funds, infrastructure and opportunistic credit.
ERS' diversified portfolio generally brings steady returns and provides sufficient cash flow to pay monthly benefits, although the system is in a negative cash flow environment with less money coming in through payroll contributions than is paid each month in annuities. The portfolio is therefore invested in a way that limits downside risk during poor economic environments over the long-term and maintains a certain level of liquidity.
The investment organization consists of approximately 80 professionals and is structured by asset classes. The CIO serves as the most senior investment professional and has 10 direct reports. Although the team is organized by asset class, the CIO encourages a collaborative culture with interactions amongst the groups so that professionals gain exposure and provide input to other asset areas. The CIO reports to the executive director and works closely with both the BOT and members of the IAC
The Chief Investment Officer (CIO) will serve as the senior executive for ERS’ defined benefit trust fund and serve on the Texa$aver Product Review Committee for the voluntary 457 and 401(k) deferred compensation plans. The CIO will be accountable for the investment process and will exercise fiduciary obligations for the defined benefit trust fund. He/She will work closely with the Executive Director, Board of Trustees, Investment Advisory Committee, staff, advisors, other agency divisions, stakeholders, consultants, consulting actuaries and third-party administrators to provide progressive leadership for the investment program.
The CIO will be accountable for the investment process and rigorous review of existing and prospective investment strategies and provide recommendations for new or revisited investment strategies. To ensure the preservation and growth of ERS trust fund assets, the CIO must meet fiduciary obligations of the Boards of Trustees. He/She will serve under general supervision of the Executive Director with extensive latitude for the use of initiative and an expectation of, prudent and professional independent judgment.
In addition, the CIO is responsible for managing key aspects of ERS’ investment programs, including strategic goals and policies, governance, contracts and assets within state and federal law. Other key investment responsibilities include:
Partner with other agency divisions, analyze, develop, and recommend strategic direction and policies of the investment programs to the Executive Director and the Board of Trustees.
Direct the implementation of investment strategies, initiatives, and policies to ensure solid performance, cost effectiveness, risk management, and strategic fit with the overall portfolio.
Direct program goals, investment performance, portfolios, risk characteristics and ensure compliance with all applicable state and federal rules and regulations.
Understand policy issues surrounding the defined benefit and defined contribution retirement programs and participate in discussions regarding funding policy and participation issues.
Keep current and advise the Executive Director and the Board of Trustees on domestic and global economic trends in order to effectively foster consideration of new ideas to maximize returns consistent with prudent risk.
Contribute an innovative perspective on retirement and investment issues in the public and private environment.
Ensure the preparation and timely presentation of reports and due diligence needed for program decision-making, and to ensure that the Executive Director, Board of Trustees, and other interested parties are fully informed of program operations and activities.
Responsible for the development and use of adequate internal controls to ensure the assets of the ERS trust fund are safeguarded and that all investment staff and contractors fully comply with all applicable ethics laws and policies.
Oversee contract management and best practices for investment service providers, consultants, advisors and third party administrators, including coordination with ERS purchasing/contract administration and legal staff; development, review and approval of bid and contract specifications and appropriate service level agreements; and monitoring of vendors/contractors to ensure fulfillment of contractual obligations.
Responsible for working with the Executive Director in the development of the program organization, compensation, and all key employee matters.
Oversee the preparation, presentation, and implementation of budget requests.
Direct the coordination of the activities of the Investment Division with the Executive Director, Deputy Executive Director, and other Division Directors.
Represent ERS with other statewide retirement funds, other public pension plans, state agencies, investment consultants, third-party administrators, external entities, and/or government officials regarding investment related matters.
Ensure effective internal communications that promote teamwork, good morale and collaboration.
Work with contracted pension actuaries to foster a cooperative understanding of the interrelationships between assets and liabilities.
Comply with CFA Institute Code of Ethics and Standards of Professional Conduct.
Minimum 15 years experience managing investment portfolios.
Investment management experience with pension funds that have assets of at least $15 billion.
Ten years progressive experience directing a multi-asset class pension plan that internally managed funds.
Experience managing a large staff of investment professionals.
Strong leadership and communication skills inspiring staff, collaborating with stakeholders, and demonstrating determination to drive an agenda approved by the Executive Director and Board of Trustees.
KNOWLEDGE, SKILLS, AND ABILITIES
Employ all knowledge, skills, and abilities to apply critical thinking to all aspects of the job. Critical thinking is a process of forming reasoned opinions through observation, information collection, interpretation, analysis, inference, evaluation, and other skills necessary to successfully meet performance standards of the job.
Extensive knowledge of investment concepts, strategies, and analytical methodologies.
Advanced knowledge of investment processes.
Broad knowledge base of all asset classes.
Knowledge of global and domestic macroeconomic and capital market issues relating to investments.
Ability to develop and reach long-term and short-term investment goals.
Possess and exhibit high moral and ethical standards.
Advanced knowledge of actuarial principles and asset-liability studies.
Ability to be flexible and open to learning and research new financial and investment strategies and to promote innovation in the Division investment processes.
Ability to effectively communicate and collaborate with all stakeholders.
Ability to inspire and lead staff to reach division goals.
Ability to recruit, retain and develop a diverse Investments staff to ensure agency strategic plans are met.
Excellent verbal and written communication; ability to testify and make presentations to government officials, the Legislature, and the Board of Trustees; ability to produce complex correspondence, reports, policies, and proposals
Ability to build consensus among divergent stakeholders.
A Bachelor’s degree from a four-year college or university is required. Strong advanced academic credentials, including MBA and/or CFA are preferred.