California’s state retiree pension fund has appointed a new chief investment officer.
Following a worldwide search, the fund announced that New Zealander Stephen Gilmore will lead investment strategy at the California Public Employees Retirement System, the fund said in a statement released Tuesday. Starting in July, Gilmore will manage a fund currently worth just under $495 billion.
CalPERS will be the next stop in a nearly 40-year career for Gilmore. He most recently served as the chief investment officer of the New Zealand Superannuation Fund, a government-owned fund valued at more than $43.5 billion.
Gilmore has overseen the “world’s best-performing sovereign fund” since 2019 and, under his leadership, the fund consistently reaped annual returns of more than 12%. Currently, CalPERS is only 72% funded and has previously struggled to hit its aggressive “assumed rate of return” of 6.8%.
CalPERS CEO Marcie Frost noted that Gilmore has experience in “very public roles” and understands the value of “transparency and resiliency” — attributes that the selection committee prioritized during its deliberations.
“He brings not only a wealth of investing knowledge to the job,” Frost said in a statement, “but he also has the temperament to understand the needs of our members and public sector employers.”
Gilmore succeeds Nicole Musicco, who departed CalPERS last September after just 18 months. (At the time, Musicco told the CalPERS board she needed to return to Toronto to help care for her family.)
His predecessor hired key staff members to lead expansions of the fund’s sustainable investments along with higher risk, higher reward opportunities. Gilmore will oversee the implementation of CalPERS’ new Sustainable Investments 2030 Strategy, unveiled last November. The plan notably includes a vague and convoluted pathway to divestment from certain funds that fail to develop and commit to viable net-zero emissions plans.
The chief investment officer position comes with a salary of $718,750, not including incentives based on fund performance.
“I’m grateful to CalPERS’ leaders for the trust they’ve put in me to help shape the pension fund’s next chapter,” Gilmore said in a statement. “There are high expectations, and rightly so, when it comes to fulfilling the promises made in serving those who serve California.”
