CalPERS’ CIO exit is latest in executive departures

Ted Eliopoulos, who has been at the US's largest public pension for more than one decade, will step away by the start of 2019.

California Public Employees’ Retirement System‘s chief investment officer is stepping down and moving to New York City, the pension said Monday.

Ted Eliopoulos

Ted Eliopoulos, who joined CalPERS in 2007, will stay on as CIO until the US’s largest public pension finds his replacement and will assist with the transition through year-end. Eliopoulos previously served as CalPERS’ senior investment officer for real estate and real assets before he was appointed interim CIO in June 2014.

“With two daughters in college, and one with health considerations that require my wife and me to be within reasonable distance, we have decided to relocate to New York City where they both will be in school,” Eliopoulos said in a statement. “Due to this fact, I will be stepping away from CalPERS by the beginning of 2019.”

As CIO he managed a team of nearly 400 staff and oversaw CalPERS’ $356 billion portfolio, according to Monday’s announcement. Before CalPERS he worked in the California State Treasurer’s office as deputy treasurer and then chief deputy treasurer.

During his tenure at CalPERS he implemented the Vision 2020 Strategic Plan to reduce the portfolio’s complexity, cut fees and better manage risk. He focused on reducing external managers, cutting the number of real estate managers from 90 in 2007 to 15 today. In total, CalPERS decreased its external managers to 140 from 400.

CalPERS also sold several private markets portfolios under his stewardship, including a multi-billion portfolio of real estate fund stakes to Blackstone’s Strategic Partners. In 2016 CalPERS generated at least $884 million in proceeds from sales of private markets stakes, representing at least 72 funds across 40 managers, according to reports from the Pension Consulting Alliance.

In 2012, under Eliopoulos’s leadership, CalPERS established a new emerging manager plan across various asset classes. Eliopoulos also oversaw several asset class changes, terminating CalPERS’ investments in hedge funds in 2014 and creating its opportunistic credit programme in 2016. He worked to further environmental, social and governance efforts, establishing the investment office’s first diversity and inclusion committee and the first governance and sustainability plan in 2016.

Other recent executive changes

CalPERS has seen a number of senior leadership changes recently. On the same day Eliopoulos announced his departure, the pension system’s new chief operating investment officer, Elisabeth Bourqui, started her position leading the investment office’s business and operations. She replaces Wylie Tollette, who left CalPERS in January to return to mutual fund giant Franklin Templeton Investments.

Last year saw chief financial officer Cheryl Eason return to Canada to become vice-president and CFO of her alma mater Royal Roads University. In April 2017, Real Desrochers, managing investment director for private equity, left to join CITIC Private Equity Funds Management.

Two sources who work with the pension system told sister publication PERE that CalPERS is a “tough” place to work at the highest levels.

“But Ted was cut out to survive there,” one source said. “If wasn’t for the family considerations, he might have stayed. The insiders have known this is something that could be coming for a while.”

CalPERS managed $26.8 billion in private equity, $30.5 billion in real estate and $6.1 billion in infrastructure and forestland as of 28 February, according to its website. Overall, the pension system returned 11.2 percent for the year.