Scott Chan has some big shoes to fill at CalSTRS; New CIO of the $346.5 billion fund plans to begin with bolstering investment staff and adding portfolio resiliency

Chan has been at the California State Teachers' Retirement System, West Sacramento, for six years, serving as deputy chief investment officer before he assumed the CIO post on July 1, following the retirement of long-standing CIO Christopher Ailman. According to public pension fund returns tracked by Pensions & Investments, CalSTRS ranks below the 9.8% median for the one year but was 13th for the five-year period and ninth for 10 years. In the private markets, CalSTRS is "unlikely to build an internal Blackstone," but its collaborative model has a wide array of strategies that give CalSTRS more control, such as co-investments, joint ventures and minority or majority ownership interests or revenue-sharing with money managers, Chan said. Since 2017, the collaborative model as well as the contribution of its expert staff has saved CalSTRS $1.6 billion in fees and created more than $10 billion in value added to the fund, he said.