An unnamed CalPERS executive said this week that CalPERS voted to adopt a "total portfolio approach" to investing, a change intended to shift decision-making from fixed four-year asset-class allocations to cross-functional choices aimed at improving the fund’s funded status and long-term returns.

The move, the speaker said, will require investment professionals who traditionally managed single asset classes to make decisions for the overall health of the fund, even when those investments fall outside their prior purview. The speaker said the change is scheduled to begin July 1 and that, per committee direction and at Mr. Ruffino’s request, a two-year asset-liability-management (ALM) review will include an agenda item to check how governance practices are working under the new model.

The executive framed the shift as an organizational priority to deliver better returns and greater transparency for nearly 2,400,000 members. "This week, you voted to adopt a total portfolio approach to investing," the speaker said. The speaker added the change is significant and described accompanying work on cultural norms and onboarding to support cross-functional collaboration.

CalPERS did not provide details in the remarks about the specific governance changes that will be proposed in the ALM review, nor did the speaker provide vote tallies, mover/second information, or which formal board body cast the vote. The organization said it will monitor governance practices during the two-year review and report back through the committee process.