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Texas ERS Expands Emerging Manager Program

In this month’s President’s Corner Lauren Honza at the Employees Retirement System of Texas talks about ERS’ commitment to supporting emerging managers and how you can engage with the organization.

The Employees Retirement System of Texas is committed to having a quality emerging manager program. Since starting our formal program in 2010, ERS has invested/committed over $500 million to small and diverse managers. At the end of February, ERS’ Board of Directors approved the Emerging Manager Program Policies & Procedures and Tactical Plan as part of the ERS Investment Policy, where we set a goal to double the allocation to $1 billion by FY2019. The program will be across asset classes and will use a hybrid approach of fund of funds and direct investments. We will continue to invest with emerging managers in public equity, private equity and private real estate through our fund of funds partners. In addition, we are looking for the best ways to work with emerging managers in hedge funds and fixed income. We’re excited to broaden our engagement and outreach to meet the many qualified managers in all of these asset classes.

We also plan to take a hands-on approach, building direct relationships with managers so that when the time comes for managers to graduate they have the right contacts and connections to be considered for direct allocations. Growing successes in the industry and in the community is a win-win proposition. We want to be a part of that success.

So how will we make this happen? There are a few steps that you can take right now to engage with ERS. First, go to our External Advisor Website (https://www.ers.state.tx.us/About_ERS/Investments/External_Advisors/) and register your firm. It’s the first step to be considered for an allocation. Second, reach out to us and our partners. ERS has a great team of fund of funds that help us meet some amazing managers. Furthermore, we are always working with organizations like AAAIM to meet the best and brightest in the industry. Outreach is a major part of our plan and we hope to see many of you on October 7th and 8th at AAAIM’s national conference!

I am thankful for the support we have received from every level of the agency, including the Board of Directors, Executive Director, Chief Investment Officer, and Investments Chief of Staff.

 

Lauren Honza is the Emerging Manager Program Director at the Employees Retirement System of Texas