The fallout from investment advisor Ken Fisher’s crude remarks at an industry event now includes the loss of $600 million of assets, according to a report.
The state of Michigan’s pension fund ended its relationship with Fisher Investments due to the “completely unacceptable comments” of the investment firm’s CEO, the Washington Post reported late Friday.
In a letter to the state’s investment board (and cited by the Post), Michigan Chief Investment Officer Jon Braeutigam said: “All were in unanimous agreement that prompt termination is the correct course of action. There is no excuse to not treat everyone with dignity and respect. We have high expectations of our managers (and staff), not just with regards to returns but also in how they exhibit integrity and respect to all individuals.”
Fisher Investments had managed the state’s funds for 15 years, according to the letter, which was sent Thursday.
Also in the letter, Braeutigam said that while Fisher Investments’ “performance has been good (beating the S&P 1500). … , this history does not out-weigh the inappropriateness of the comments made by the founder.”
Fisher Investments recently managed roughly $114 billion in client assets, so the $600 million in departing assets from Michigan represent a 0.5% decline in assets.
The State of Michigan Retirement Systems includes about $70 billion in total assets; the funds leaving Fisher Investments account for 0.9% of this figure. Its in-house investment team will take over management of these retirement funds, the Post said.
Fisher Investments manages retirement funds for a number of companies and states, including $386 million of Iowa’s $34 billion in pensions, according to a Bloomberg report.
“Fisher’s remarks are obviously concerning,” Shawna Lode, a spokeswoman for the Iowa Public Employees’ Retirement System, said in an email to Bloomberg. “Although our investment management contracts do not include a conduct policy, we hold our partners to the highest standards and reserve the right to amend or sever any contract at our discretion.”
The Public Employees’ Retirement System of Mississippi has Fisher Investments managing about $500 million, or 2% of its assets, according to CNBC, which also broadcast a recording of certain remarks made by Fisher on Friday.
PERS’ executive director, Ray Higgins, told the network that although it has not decided to end its relationship with Fisher, “… We will certainly consider this matter as well as the response statement that issued by Fisher Investments, as we continue to monitor they provide and ultimately their performance.”