CalSTRS names and shames poor performers
US - The California State Teachers' Retirement System has placed five companies on its Workplan of poor corporate performers.
It believes the publicly held companies within the pension system’s US$133bn fund have consistently produced under-par returns and fallen short of accepted corporate governance practices.
The current workplan companies, drawn up from the passive portfolio within CalSTRS’ domestic equity portfolio, include:Compuware Corp. - Detroit MILevel 3 Communications, Inc. - Broomfield, COSirius Satellite Radio Inc. - New York, NYSolectron Corp. - Milpitas, CAUnumProvident Corp. - Chattanooga, TN
The companies were flagged based on poor financial performance compared to market benchmarks and peer groups, for one,three and five year periods.
Corporate governance issues include executive compensation packages or activities such as amending bylaws without shareholder approval.
CalSTRS has confirmed it will co-operate with these companies with the expectation they will show improvement.
Jack Ehnes (pictured), chief executive of CalSTRS said: “As a long term investor, we cannot trade away our disappointment in poor performers. We have an obligation to California’s educators to engage these companies and work toward rehabilitating the health of portfolio assets’
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