2011 U.S. Investment Management Award Winner for Large Public Fund

Changing how institutional investors think about what they do is tough. But as CIO of the $153 billion California State Teachers’ Retirement System, Christopher Ailman is at the forefront of a movement to do just that. Under the direction of Ailman and CalSTRS CEO Jack Ehnes, since 2008 the teachers’ pension fund has fully integrated environmental, social and corporate governance issues into its investment thinking — a first for a U.S. public plan.

For Ailman, 53, who joined CalSTRS in 2001 from the Washington State Investment Board, where he served as CIO, looking at ESG issues is an important part of risk management. Now Ailman and his team are taking steps to further improve CalSTRS’ risk management, implementing a strategic risk-based asset allocation program for the entire fund. In the wake of the financial crisis, Ailman and his team have temporarily shifted money into real estate and private equity while preparing to make their first investments in hedge funds. These and other bold decisions are having an impact. In 2010, CalSTRS posted a return of 12.7 percent, bringing its market value back to October 2008 levels.

Click here to access the profile index for the 2011 U.S. Investment Management Award Winners. Read the feature story, Best of the Best Money Managers.