Based on the report, CalPERS will give Argentina, Peru and Turkey - markets that fell below CalPERS required score -- one year to improve. CalPERS Board deferred for 30 days a decision to divest in the Philippines.
"The good news is that generally countries' scores have improved over the two year period we have had this policy. We remain optimistic that over time we will continue to see more countries meeting our threshold," said Rob Feckner, CalPERS Investment Committee Chair. "And our door remains open to discussing how more countries can improve their markets to better support institutional investment."
CalPERS decides which emerging equity markets it will invest in based on a report prepared by Santa Monica, California-based Wilshire Associates who evaluates markets on economic factors such as market liquidity and volatility, as well as political stability, financial transparency and labor standards.
Argentina, Brazil, Chile, Czech Republic, Hungary, Israel, Jordan, Malaysia, Mexico, Peru, Poland, South Africa, South Korea, Taiwan, and Turkey will remain on CalPERS permissible markets investment list.
Malaysia was moved into the investable universe because of improvements made in that country.
Investments in the following equity markets will continue to be banned: India, Morocco, Philippines, Sri Lanka, Thailand, Colombia, China, Egypt, Pakistan, Russia, Venezuela and Indonesia.
The review showed that Argentina, Turkey and Peru, who were on the permissible list last year failed to make the cut. Under CalPERS current policy, the countries will be given one year to improve - a time period CalPERS refers to as the "cure period."
The Philippines, which was placed in the cure period after last year's review, improved slightly but not enough to reach CalPERS standards.
CalPERS has approximately $2.6 billion currently invested in the emerging markets, including $67 million in the Philippines.
Wilshire Associate's full report on the emerging markets can be found in CalPERS press room on its web site at www.calpers.ca.gov.
CalPERS is the nation's largest public pension fund with assets of approximately $167 billion. The System provides retirement and health benefits to 1.4 million State and local public employees and their families.
