BRADENTON, Fla. — North Carolina State Treasurer Janet Cowell appointed an independent bipartisan Investment Fiduciary Governance Commission to recommend reform measures for the state's $83 billion pension investment program.
The 11-member commission is composed of industry experts, legislators, and members of the consolidated North Carolina Retirement Systems, Cowell said Jan. 16. She appointed Michael Kennedy, chairman of the Federal Retirement Thrift Investment Board, as chairman.
Hewitt EnnisKnupp, a global investment consulting firm, will assist the commission.
The governance review comes on the heels of a multi-year investigation conducted by Cowell's office that found potential abuses in the use of placement agents, which are paid a fee by investment managers to solicit potential investors for a fund.
The commission will examine best practices from the public, private, and nonprofit investment sectors, and make recommendations on improving North Carolina's pension structure by April 30 to be considered by the Treasurer and the General Assembly.
Cowell said the goal of the panel is to ensure that the pension fund's investment program is "efficient, cost-effective, transparent, and conducive for long-term growth."
"As Treasurer, I am charged with taking the long view on financial stability," she said. "North Carolina's pension fund is strong and one of the best-funded in the country [and] that's why we need to look at reforming it from a position of strength."
The commission will evaluate if the pension program should continue using the treasurer as the sole investment trustee or its oversight should be a board of trustees or some other structure. The panel will evaluate investment fiduciary independence and if enhancements are needed to external investment oversight, reporting, and monitoring.
Morningstar Inc. recently said that North Carolina's pension fund is the third-highest funded of any state at 93.9%. It is the 11th-largest public pension fund in the country and has more than 875,000 beneficiaries.