Austin Firefighters Relief and Retirement Fund is seeking resumes for a Benefits Specialist. For further information, view the Job Description below:

The Institutional Limited Partners Association's ILPA Institute will be in Austin May 11-12, 2022, offering its executive education programming for trustees. The Private Equity for Trustee course explores the basic aspects of the private equity asset class, the economics of a private equity investment, the current state of the market, and its external perception. The program fee is $1499 and will run from 9 a.m. to 5 p.m. each day at the DLA Piper Austin Office, 303 Colorado St., Suite 3000, in Austin. For more information and to register, contact Mandy Ilk at [email protected].

The following list is a compilation of the upcoming interim legislative hearings that might interest TEXPERS' System Members. Hearing dates and times are subject to change. Please note that additional hearings dates may also be added at any time. Items directly impacting pensions are highlighted in yellow.

The countdown to the start of TEXPERS' 2022 Annual Conference, April 3-6 in Fort Worth, Texas, continues with the announcement of the sponsors of the event's annual golf tournament. On Sunday, April 3, the conference kicks off with the association's annual golf tournament at Rockwood Park Golf Course. 

Due to the impending retirement of three Texas senators, Lt. Gov. Dan Patrick announced on March 23 the appointments of their replacements to serve on committees during the interim leading up to the 88th Legislative Session.

Dade Phelan, the Republican Speaker of the Texas House, announced some of the key policy priorities for the 2023 legislative session. Some of his priorities have direct and indirect implications for managing public employee pensions.

TEXPERS members are trustees, administrators, professional service providers, employee groups, and associations engaged or interested in managing public employee retirement systems.

Public pension fund trustees and administrators benefit from participating in TEXPERS conferences by receiving valuable education and connecting with other professionals committed to securing retirement for public employees. Your next opportunity to boost your professional skills is during our Annual Conference April 3-6, 2022, at The Worthington Renaissance Fort Worth Hotel in Fort Worth, Texas.

Attendees of TEXPERS' 2022 Annual Conference have an easy way to satisfy their networking, learning, and organizational needs. Meet TEXPERS365, your personal conference assistant.

When advising our sons and daughters on how to invest for their retirement in roughly 60 years, we point them to stocks and the budding venture capital ideas of their classmates. The same advice might also hold true for perpetual institutions with a nearly infinite time horizon, no annual cash-flow requirements, and a passing interest in market volatility.

With headline inflation at multi-decade highs investors are rightly concerned and it bears an in-depth look. Some of the drivers of price rises have persisted longer than the Fed expected. But looking beyond the headlines at some of those drivers of the last twelve months could be useful.

Since mid-January risk markets have experienced elevated volatility and weakness due to fears of the Fed’s tightening policy. Market segments with the highest valuations and most perceived sensitivity to rates have suffered the worst, as many investors took gains after a sustained post-pandemic run. While it is important to not overreact to short-term swings, it’s also important to assess possible downside moves from here based on both technicals and fundamentals. 

Spreads and yields/rates is the simple answer to the above question. Let’s take a look at what is going on:

The Texas 2022 Primary Election is set for Tuesday, March 1st, 2022. Due to redistricting, all 181 legislative seats are up for re-election this year. If needed, primary election runoffs will be held on May 24th, 2022.

Even after strong performance in 2021, listed infrastructure stands to potentially benefit in 2022 from a favorable macro backdrop, investors’ search for inflation protection, and attractive valuations. 

The north star of active bond management is simple: avoid losing money. Over the last eighteen months, that proved quite easy to accomplish. In the period since credit spreads hit their pandemic-highs, outperforming has proved reasonably straightforward as long as investors stayed overweight the market. Unprecedented central bank and fiscal support has driven a swift bounce back in economic activity that has resulted in positive returns for credit market investors (and investors in risk assets of almost every stripe). But as the Fed looks to withdraw monetary accommodation, and fears about inflation, record debt levels and uneven and unstable recoveries intensify, investors could be forgiven for thinking that the outlook will be much more challenging in the year ahead.

Editor's note: Before Steve Toyota, a Vice President on the Business Development team at fund management and investment advisory firm Capital Dynamics, he spent 28 years with the Miramar Police Department. He retired from the police department in February of 2021. He had served as a trustee on the Miramar Police Officers' Retirement Plan Board since 1998 and was chairman of the Board from 2005 to 2019. During his 20-plus years as a trustee on this retirement plan's Board, he worked with investment managers of nearly every asset class, helping grow the plan from $20 million to $260 million. At Capital Dynamics, as a global private asset manager, he focuses on private equity, private credit, and clean energy infrastructure and has gained extensive knowledge and experience developing solutions tailored to meet the needs of a diverse and global client base of institutional investors, including public pension systems. In this blog post, he explains why it is important for trustees to get involved in their retirement plan's decisions, why he moved from policing to investment management and offers advice to trustees.

Note: This piece was adapted from a roundtable discussion. -- What do corporate fundamentals look like in a year where inflation and rates are taking center stage? Developed and emerging market (EM) corporates look fairly well-positioned, supported by the continued re-opening of economies and largely successful vaccine rollouts around the world. Earnings have also improved across the board, and defaults are expected to remain low going forward. That said, there are ongoing concerns around inflation amid rising raw material costs and supply-side disruptions. Although many companies have been able to pass higher costs through to consumers, the longer-term casualties from the tangled supply chain will have repercussions for some time to come—and we have likely not yet seen the full effects of wage inflation. These factors raise questions around how much margin compression may result from continued inflationary pressures going forward and the ultimate impact of inflation on consumer demand. On the positive side, for both developed and EM companies, we've seen a significant amount of refinancing in 2020 and 2021, meaning many companies have locked in lower funding costs and now have a stronger buffer against these pressures. This should help keep corporate fundamentals relatively stable.

Equity markets were jolted in January amid growing concerns about macroeconomic threats. For investors seeking more stable equity allocations, stocks “in the middle,” with high-quality features and reasonable valuations, can help portfolios cope with volatility.

It is becoming increasingly apparent that Environmental, Social, and Governance (ESG) considerations are at the forefront of Investors’ minds. ESG and sustainability considerations are becoming a focus throughout all stages of the investment process. Considering the current events and how ESG factors are shaping the ways we live, in October, world leaders met at the United Nations Climate Change Conference in Glasgow, Scotland, to address the issue at hand. Numerous Investment Managers and hundreds of Investors have made the pledge to commit to net zero carbon. CBRE highlighted key trends influencing Investor strategies in 2021 and beyond, many with ESG considerations taking the lead. A recent study by the Harvard Business Review concluded a third of all professionally managed assets, roughly $30 trillion, are now subject to ESG criteria across the globe.[1] While the list of sustainable initiative efforts grows exponentially, Diversity, Equity, and Inclusion (DEI) initiatives are also moving to the fore in our industry.

We would like to thank Sarah Welton, Business Growth Director, at Longevity Partners and Zoe Hughes, Chief Executive Officer of NAREIM for their contributions to this article, given their extensive knowledge and expertise in the ESG space.