Article XVI, Section 17 of the Constitution of the State of California provides that “Notwithstanding any other provisions of law or this Constitution, the Retirement Board of a public pension or retirement system shall have plenary authority and fi duciary responsibility for investment of monies and administration of the system….” Article XVI, Section 17(a) further provides that “the Retirement Board of a public pension or retirement system shall have sole and exclusive fiduciary responsibility over the assets….”

SCERS maintains an overall investment policy designed to achieve a diversified investment portfolio. An integral part of the investment policy is the strategic asset allocation, which is designed to provide an optimal mix of asset classes with return expectations that correspond to expected liabilities. The strategic asset allocation also emphasizes maximum diversification of the portfolio to protect the System from the possibility that a particular asset class may experience poor investment performance in a given period.

SCERS prepares a comprehensive annual financial report (CAFR), which describes the system’s activities, provides complete financial statements, and summarizes investment performance and actuarial funding status. Other relevant actuarial and statistical data are also included. The readers of the CAFR will find this information helpful in understanding SCERS and its commitment to financial integrity and participant service.