Today’s vote follows actions in February and March 2004 by CalPERS Board that gave the Philippines 60 days to bring forth new information about their economy and markets that may affect their investability with CalPERS.
CalPERS consultant, Wilshire Associates, was instructed to reevaluate any new findings about the Philippines and any other country in the System’s annual Permissible Equity Analysis that reviews markets against a variety of market factors plus other factors such as transparency, political stability and labor practices.
"These three countries have made significant progress and demonstrated that they now meet our high standards for investment," said Sean Harrigan, President of CalPERS Board of Administration. "This is an example of our policy having a positive effect in the emerging markets."
The Philippines score was raised after changes the country made to their laws and procedures.
India and Peru moved to new global standards for trade settlement to settle trades one day after the trade date.
The changes put the three countries above the passing mark.
Investable emerging equity markets now include Argentina, Brazil, Chile, Czech Republic, Hungary, India, Israel, Jordan, Malaysia, Mexico, Peru, the Philippines, Poland, South Africa, South Korea, Taiwan and Turkey.
Investments in the following equity markets will continue to be on the non-invest able list: Morocco, Sri Lanka, Thailand, Colombia, China, Egypt, Pakistan, Russia, Venezuela and Indonesia.
Turkey and Argentina still remain in CalPERS one-year "cure" period after their scores fell below a score of 2.0. Under CalPERS policy, any market with a previous score of 2.0 which fell below that score is given a year "cure" period. If in year two, the country has not elevated its score to 2.0, it requires that the System divest of its holdings.
Investment Committee Chairman Rob Feckner expressed support for the emerging country evaluation process and said, "we can and will do more to refine our process so that any emerging country that wants to be responsive to our standards has a timely opportunity to be considered."
CalPERS has approximately $2.0 billion invested in the emerging markets.
