News Summary
The Pennsylvania Public School Employees’ Retirement System (PSERS) has appointed Benjamin Cotton as interim executive director following the retirement of Terrill Sanchez. Cotton, previously the Chief Investment Officer, will lead during the search for a permanent replacement. PSERS, managing a $75 billion pension fund, aims to diversify its investment strategies, having recently approved new managers for private equity. Stakeholders will closely monitor the organization’s performance during this transitional period amidst ongoing investment challenges.
Pennsylvania—The Pennsylvania Public School Employees’ Retirement System (PSERS) has appointed Benjamin Cotton as the interim executive director following the retirement of Terrill “Terry” Sanchez, who officially departed from the role on June 13. Cotton’s appointment took place during the board meeting that same day. He will serve temporarily as the organization conducts a nationwide search for a permanent replacement.
PSERS, which manages a substantial pension fund valued at approximately $75 billion, has recently approved two managers to implement various private equity investment strategies. During the trustees’ meeting in June, the fund set a target allocation of 12% to these private equity ventures. Currently, the actual allocation to private equity strategies stands at 16%. Notably, such investment strategies have seen a return of 5.17% in 2024.
Cotton joined PSERS earlier this year as Chief Investment Officer after a successful tenure as a senior managing director for the United Auto Workers Retiree Medical Benefits Trust. He holds a doctorate in leadership and learning in organizations from Vanderbilt University. With an extensive background in investments and organizational leadership, Cotton steps into the interim role at a critical time for the pension fund.
His predecessor, Sanchez, had been a long-time employee of PSERS, having started her career with the organization in 1987. She served as deputy executive director before taking on the top executive role. Sanchez announced her retirement plans in February, returning briefly to her position after temporarily filling in during a previous transition period. In November 2021, she was part of a broader shakeup within PSERS, which included the retirement of executive director Glen Grell and Chief Investment Officer James Grossman Jr. This change came in the wake of a federal inquiry regarding reported inaccuracies in investment figures, although the pension fund itself was absolved of wrongdoing.
In 2024, former investment consultant Aon Investments USA reached a settlement of $1.5 million with the Securities and Exchange Commission (SEC), and PSERS itself settled a lawsuit against Aon for $7 million earlier this year, which was filed in December 2022.
The board’s selection of new managers for private equity strategies aligns with PSERS’s ongoing efforts to diversify its investment portfolio and enhance returns for its members. The decision reflects the pension fund’s commitment to strategic investments aimed at achieving financial sustainability amid fluctuating market conditions.
As Benjamin Cotton takes on the responsibilities of interim executive director, stakeholders in Pennsylvania’s education sector will be closely monitoring the retirement system’s performance and the progress of the ongoing search for a permanent executive. His expertise in investment strategies may prove pivotal in navigating the complexities of public pension management during this transitional period.
Deeper Dive: News & Info About This Topic
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