CalPERS’ departing CIO expresses pride in PE overhaul in goodbye remarks

Departing California Public Employees’ Retirement System CIO Nicole Musicco ranked two initiatives related to private assets as her proudest accomplishments during her tearful goodbye to the system’s investment committee meeting.

Musicco’s resignation as the CIO of the nation’s largest retirement system last week came amid the system’s overhaul of CalPERS’ private equity program. Her remarks at the September 18 investment committee meeting highlighted the importance of that mission during her tenure.

Buyouts watched a broadcast of the meeting.

Musicco said her proudest accomplishment was the creation of the system’s $1 billion emerging manager platform – essentially two funds of funds managed by TPG and GCM Grosvenor.

“This raised awareness with other allocators and has been a catalyst for change,” Musicco said.

TPG and GCM were each given $500 million to manage funds that commit capital to and purchase stakes in emerging managers – a strategy that could both fuel the new manager ecosystem and lead to further gains for CalPERS.

Musicco’s commitment to the emerging managers platform was made evident as late as last week, when she appeared on a webinar alongside Robert Greene, president of the National Association of Investment Companies, which represents diverse-owned alternative investment funds.

In her goodbye to the board, Musicco also spoke proudly of the development of the system’s private equity program.

“We made major strides in accelerating our private market investments as well as building more innovation into our investment strategies,” Musicco said.

Under her watch, Musicco made several key new hires, streamlined policies and launched new approaches to direct investing and direct lending as part of her vision of CalPERS’ private equity portfolio.