Joan Bellner to STRS Board 8/17/23: the time for transparency is NOW

From Joan Bellner

August 17, 2023

My topic today is transparency.

Building transparency builds trust. If I, and the other members, are to feel secure in our pension fund, we need to be able to trust the Board and others within STRS.

At the March ORSC meeting, Auditor Faber told the committee that although their audit showed no evidence of fraud or illegal acts, they quote “did identify several governance issues that should be addressed”, including “management concerns and public policy concerns”.

(very eye-opening session to watch- archived on the Ohio Channel).

Faber requested that things be looked into and highly recommended that changes be made as soon as possible.

Afterward, STRS began touting the receipt of the newest 2023 StaRS transparency award from Faber’s office– seemingly claiming no need for improvement… until April 27th, when

Faber wrote an admonition letter to key players at STRS, asking them to stop claiming actual transparency.

Quote:      

      “For any person or organization to conflate our StaRS 
      (transparency) award with a determination of overall operational
       transparency is simply wrong (emphasis added) and may serve 
       to confuse the public (emphasis added). As noted in our special 
       audit, we strongly encouraged STRS to change its practices to 
       become more transparent with its STRS Board and members.”

Recently, at the STRS meeting in Maumee, there was somewhat of a 180° turnaround. The executive director publicly & wholeheartedly endorsed improved transparency, especially in regards to private equity and hedge fund fees. He stated that other staff support this initiative, as well, and that they currently are lobbying the SEC and legislators to do something about it.

Here’s my quandary: Moral and ethical people do the right thing, even when no one’s watching. They do not wait for an industry or the law to tell them they HAVE to do it… So, why are you waiting?

There ARE fees that CAN be shared publicly without interfering with purchases– or exposing too much information regarding our investment strategies, etc.

If I’ve heard correctly, most everyone in these rooms is in agreement that transparency– especially regarding fees– is good and desirable. 

So, again, why wait? Why waste time & money lobbying the SEC and legislators? Why continue to allow staff to rehash the same old defensive propaganda and statistics to make everything STRS does, including investments, sound (quote fingers) exceptional? 

All of that is just empty words. 

Something needs to be done. Just DO IT!

If Ohio can be first in so many things, including the first professional baseball team, the first laws protecting working women, and the first interracial college… then it can produce the first public pension fund to go public with all investment fees.

The time for transparency– in all aspects– not just those fees– is NOW. 

Don’t wait. 

Please, Board members, improve transparency with ALL of the management and public policy concerns raised by Faber in March.

Thank you.

Joan Bellner,  STRS Retired member