Institutional Investor's Alpha Magazine - April 2008 - (Page 70)

Interview Denise Nappier Proceeding with n the decade since Denise Nappier beat the establishment incumbent in a hotly contested election to become Connecticut’s treasurer and the principal ﬁduciary for the state’s pension plans, she has emerged as one of the most activist public ofﬁcials in the country. Nappier, 57, the f irst African-American woman to simultaneously hold such positions in the U.S., is a champion of public investment in women- and minorityowned businesses and in homegrown companies Denise Nappier, in Connecticut. She has managed along the way Connecticut’s state to demonstrate the feasibility and proﬁtability treasurer and its of socially responsible investing: For the fivechief pension fund year period ended Noofﬁcer, brings a vember 20, 2007 (the most recent ﬁgures availmaverick brand of able), the Connecticut Retirement Plans and integrity to a state that Trust Funds averaged has had more than 12 percent annual returns. Among the funds’ its share of scandal. holdings is a stake in the Canyon-Johnson Urban Funds, a joint venture that promotes investment in affordable housing and whose management includes former basketball star Earvin (Magic) Johnson. The CRPTF has also invested in the WLR Recovery Fund, managed by Wilbur Ross, who is famous for rebuilding failed companies. As of January 31 the pension funds had a total value Caution By Udayan Gupta of $24.4 billion, with 33.4 percent in domestic stocks, 20.9 percent in developed and emerging-markets stocks, 35.4 percent in ﬁ xed income and 10.2 percent in venture capital, private equity and real estate. In total, Nappier oversees about $50 billion in state money. Over the years she has gained a reputation for assertively handling mismanagement and malfeasance. “She is a decisive, hands-on ﬁduciary who actively pursues every appropriate opportunity to protect fund assets and create value,” says Francisco Borges, who was state treasurer from 1987 to 1993 and is now chairman and managing partner at Landmark Partners, a private equity and real estate investment company based in Greenwich, Connecticut. Borges says Nappier is “tenaciously unyielding when it comes to protecting the interests of the pension plans’ beneﬁciaries — without regard to whom it may rattle.” Former New York State comptroller H. Carl McCall says Nappier uses her activist strategy wisely: “She selects her cases very carefully. She focuses on the ﬁrms that can help bring clarity to the conﬂ ict and act to make sure that others learn from the encounters.” In 2002, Connecticut sued Forstmann Little & Co., a New York–based private equity ﬁrm, after it lost $125 million of the state’s pension money; Forstmann Little agreed to a $16.2 million settlement. “They double-crossed us, pretending to be our partners and selling us out,” Nappier said at the time. “We want to make them the poster child for shareholder fair dealing.” In 2004, after a Texas-based fund of hedge funds was found to have reinvested distributions without client approval, the CRPTF took away its $600 million portfolio and awarded it to a Connecticut ﬁrm. And last year the I 70 • INSTITUTIONAL INVESTOR’S ALPHA • APRIL 2008

Table of Contents Feed for the Digital Edition of Institutional Investor's Alpha Magazine - April 2008

Institutional Investor's Alpha Magazine - April 2008 Contents Letter from the Editor Longs & Shorts Pension Corner: Here to Eternity The Good Guys: Voice of Hope Cover Story: The Kings of Cash Where the Money Is Into the Light Interview: Proceeding with Caution Strategies: A Convenient Truth Alpha Bytes: Village Voice Unhedged: Commentary: No Time for Complacency

Institutional Investor's Alpha Magazine - April 2008

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