The Allocator Collective (formerly Institutional Allocators for Diversity, Equity, and Inclusion) was founded in 2020 in response to George Floyd’s murder, when GPs and LPs wanted to become better at fostering D.E.I.
“Teams across our industry tried to think about how we can do better finding and evaluating managers and getting them into portfolios,” Rahbari told attendees. “Our portfolio wasn’t magically getting any more diverse without proactive action.”
So, Rahbari and other allocators asked peers for diverse manager recommendations, compiled them, and shared the list in an Excel spreadsheet, which grew into a database of over 700 diverse managers.
Rahbari noted that the collective’s core purpose is not just altruism: It’s to widen the sourcing funnel, reduce bias, improve diligence, and find new sources of alpha.
“The old boys’ network isn’t necessarily getting it done,” he added. “So, we have to create our own networks.” Rahbari added that the Collective’s events have already driven about $500 million in capital to diverse managers.
N.C. Passes on Crypto: I also attended a video press conference this week held by North Carolina Treasurer Brad Briner, where he and NCRS CIO Kevin SigRist shared that the state is redeploying billions from its pensions’ high cash reserves into assets like equities and fixed income, but not crypto.
While Briner conceded that “the underlying blockchain technology is profound in what it can do to various aspects of the financial architecture out there,” the state “continue[s] to not own [digital assets] directly.”
Despite growing interest in digital assets, their volatility makes them a bad fit for the $139 billion pension system’s goal of returning at least six-and-a-half percent consistently, according to Briner. “A highly volatile asset like Bitcoin doesn’t really help us do that,” he said.
While there was a state bill that would have allowed the investment office to invest up to 5 percent of public funds in digital assets, it has currently stalled in the Senate. The state Treasurer noted that while the investment office could invest in digital assets through synthetic means, it chooses not to. “We have not found their risk and return to be a compelling match for what we’re trying to do in the retirement system,” he explained.
NYC Looks to Drop BlackRock: BlackRock may have found itself in a hard place trying to appease multiple stakeholders with conflicting views on ESG. Most recently, New York City wants to drop the investment giant for failing to meet the systems’ climate expectations.
NYC Comptroller Brad Lander is calling on the city’s $294.6 billion pension plans to open the $42.3 billion in U.S. public equity index mandates that BlackRock manages for rebid. He cited BlackRock scaling back its proxy voting engagement with U.S. companies where it holds at least 5 percent after the SEC changed its reporting rules under the Trump administration. Lander argues that this discourages companies from making meaningful decarbonization efforts (e.g., setting net-zero targets, adopting science-based goals, aligning capital spending with climate objectives).
“The systemic risk of the climate crisis threatens the long-term value of New York City’s pension funds,” Lander said in a statement, asking his fellow trustees to move pension money away from BlackRock for failing “to address climate risk with the seriousness we expect.”
However, BlackRock has argued that it still offers a decarbonization programs for investors who want it. BlackRock’s Armando Senra says it’s “another instance of the politicization of public pension funds, which undermines the retirement security of hardworking New Yorkers.”
This follows Texas suing the money manager for allegedly pursuing ESG strategies behind investors’ backs. Guess you just can't please everybody.
I’d be curious to know what you think about all of this — on or off the record.
