New Video – Illinois State Board of Investment Earns Highest Private Equity Returns of Any Public Pension Fund

Today, the American Investment Council (AIC) released the third video in a new series of interviews conducted by Hill TV examining how private equity investments are supporting the retirements of dedicated public servants across America. Today’s video features an interview with Johara Farhadieh, who is the Executive Director and Chief Investment Officer (CIO) of the Illinois State Board of Investment (ISBI). Farhadieh discusses the critical role that private equity investments play in a diversified portfolio for any public pension fund:

Private equity at the end of the day should be a return enhancer to a diversified portfolio,” said ISBI Executive Director and Chief Investment Officer Johara Farhadieh. “[Public pension funds] all have a certain objective and investment return that we are trying to achieve, and I think that asset classes like private equity are necessary to be able to achieve those targets.

The American Investment Council recently released its annual public pension study, which examined the investments and returns of America’s largest public pension funds. ISBI placed first in the rankings, with Illinois’ more than 165,000 state park employees, frontline workers, public health officials, and other dedicated public servants benefitting from a 16.10 percent annualized 10-year return from private equity investments. Farhadieh finished the interview by discussing how ISBI has prioritized diversity and inclusion initiatives within their private equity portfolio:

Thirty-nine percent of our portfolio is committed to minority and women owned firms … Not only are we proud [about ISBI’s private equity] performance, but we are also proud that 21.4 percent of that portfolio was committed to minority and women owned private equity fund managers. We are really proud to be able to show strong evidence that a major pension fund can achieve top tier performance while maintaining a strong commitment to diversity, equity, and inclusion.

Farhadieh’s interview with The Hill is the third in a new series of videos which will feature experts with first-hand knowledge of how private equity supports public pension beneficiaries. Watch the full interview here.

Watch the previous interviews in the series:

  • West Virginia Investment Management Board Private Equity Officer Jim Herringtonhere.
  • Public School and Education Employee Retirement Systems of Missouri Chief Investment Officer Craig Husting here.

Read the American Investment Council’s recently released public pension report here.