CALIFORNIA STATE TEACHERS RETIREMENT SYSTEM

The California State Teachers Retirement System, or CalSTRS for short, is the largest educator only pension fund in the world, providing retirement, disability, and survivor benefits since its establishment in 1913. The company was established by law and is a government owned agency, currently a part of California’s Government Operations Agency. CalSTRS is the 13th largest pension fund in the world with approximate total assets of over $193 billion as of 2015. Currently, the pension fund is closing in on its 900 thousandth member with approximately two thirds of its members made of inactive and active members who contribute and the latter third made of service retirement, disability, and survivor benefit members. These members come from over 1700 public employers including school districts, community college districts, county offices of education, and regional occupational programs. Total benefit payments, as of 2014, numbered over $12 billion total. Members are retiring at approximately 10,000, or more, a year with the median at being around 62. Investment returns have all been decently positive in recent years except for during the 2008 and 2009 financial crisis. Its assets are mostly allocated in the global equity sector, which makes up over half of its total assets invested, with other funds allocated in fixed income, private equity, real estate, and cash, among other less significant sectors, in order of decreasing allocation amounts. CalSTRS currently operates on a $177 million budget, employing 965 employees. The pension fund utilizes a hybrid system in its financial security package for its members that consists of a traditional defined benefit program, a cash balance plan defined benefit supplement program, and a defined contribution plan Pension2 in which the former two have mandatory participation and the latter has optional participation. The CalSTRS investment portfolio include stocks, bonds, real estate, and short-term investments with some of its investment policies including Global Equity Investment, Corporate Governance Program and Portfolio, Home Loan Program, Divestment, and Responsible Contractor policies.