The west virginia investment management board plays a crucial role in overseeing and managing the state’s financial assets and investments. As an independent state agency, it is responsible for investing funds for several major west virginia pension systems. The board has a fiduciary duty to make prudent investment decisions that serve the financial interests of these funds. This article will provide an overview of the key responsibilities, investment approach, and major initiatives of the west virginia investment management board in managing the state’s investment funds and assets.
Overseeing the investment of pension assets for public employees
The west virginia investment management board is responsible for overseeing the investment of pension assets for several state pension systems, including the Public Employees Retirement System, Teachers’ Retirement System, and Deputy Sheriffs Retirement System. As of June 2022, the board managed around $9.5 billion in retirement assets on behalf of these beneficiaries. The board has a duty to invest these funds prudently and strategically to generate sufficient long-term returns that can support retirement payouts by the pension systems. This requires extensive research, analysis, and oversight of the investment portfolio by the board and its investment staff.
Establishing sound investment policies and asset allocation strategies
A key function of the west virginia investment management board is to establish investment policies and asset allocation strategies for the various funds under its management. The board conducts asset liability studies periodically to determine an optimal asset allocation that balances risk versus return objectives. It sets policies regarding allowable investments, target allocations to different asset classes such as public equity, fixed income, real estate, etc. The goal is to construct a diversified, risk-managed portfolio that can meet target returns over the long run. The board also monitors investment performance regularly and adjusts its strategic asset allocation as needed.
Selecting and overseeing external investment managers
The west virginia investment management board does not manage the investment funds directly but selects specialized external managers to handle investment activities. It goes through a rigorous screening and due diligence process before appointing investment managers. The board also continuously monitors and evaluates the managers to ensure they are delivering performance in line with mandates and benchmarks. Underperformance can lead to terminating contracts with investment managers. By overseeing external managers, the board aims to leverage specialized expertise while retaining control over investment strategy and risk management.
Focusing on in-state investment to benefit local economy
In recent years, the west virginia investment management board has made a dedicated effort to expand in-state investments that can stimulate the local economy. For instance, in 2021 the board committed $150 million to help finance infrastructural development projects across the state. The board also partners with local venture capital firms to provide growth capital to emerging west virginia companies. Such initiatives align the board’s investment activities with the broader interests of the state and its residents.
The west virginia investment management board is a state agency with significant fiduciary responsibility to prudently invest the pension assets of public employees. It oversees around $9.5 billion in retirement funds currently. The board establishes sound investment policies, selects external managers, monitors performance, and sets strategic asset allocation. It also focuses on in-state investments that benefit local communities. The board’s oversight and management of these funds is crucial for the future of west virginia’s public pensions.