CalPERS 'Not Too Concerned' About Software Exposure, CEO Frost Says

Core Insights - The company maintains a strong conviction in its private markets allocation, reporting a 14.3% return in private equity and a 12.8% return in private debt for the last fiscal year, despite recent market turmoil [4][2]. Private Credit and Equity - The current allocation to private credit has decreased from 8% to around 4%, but the company believes its portfolio is diversified enough to withstand market fluctuations [2][3]. - The company has reduced fees by approximately 100 basis points over the last three years, enhancing manager selection and increasing co-investments, particularly with emerging managers [7][8]. Sustainable Investments - The company has committed to investing $100 billion in sustainable investments by 2030, with 53% already allocated to listed companies, leaving the remainder for energy transition and climate solutions [14]. - The focus on venture capital has been reestablished, targeting 10% to 15% of the portfolio towards emerging managers and venture investments [9]. Operational Efficiency and AI - The company is exploring operational efficiencies through AI to enhance productivity and investment decision-making, particularly in sustainable investments [19][21]. - New data and technology initiatives are being implemented to reduce operational costs associated with software, indicating a proactive approach to cost management [23][24].