SWIB Executive Director and Chief Investment Officer David Villa

This past year has been a year to remember. As governments and institutions worked to manage the COVID-19 pandemic and its economic impact, the financial markets experienced a great deal of volatility. We ended the year in a strong positive position with the Core Fund achieving a preliminary net return of 15.21%, and 106 basis points ahead of the benchmark.

SWIB staff have added $1.9 billion in value above the Core Fund’s benchmark over the last five years. While the end of the year has brought positive news, we continue to monitor and evaluate the longer-term impacts of the pandemic to position the Wisconsin Retirement System toward success.

Despite the ups and downs in 2020, we remained committed to our long-term investment strategy. We accomplished a great deal, all while pivoting to a remote working environment. It hasn’t been easy and there were times when we weren’t ahead of the game, but by staying the course we were able to take advantage of market opportunities to generate returns and add value to the WRS. Exceeding our 7% target return for both the 5- and 10-year periods is expected to result in continued stability in employer and employee contribution rates and a positive annuity adjustment for retirees.

Our ability to handle market disruptions caused by the pandemic is possible because of the foundation we have put in place. We have worked hard to implement a robust and sophisticated investment strategy designed to weather various market conditions. We continue to build and enhance the infrastructure and technology needed to support our strategy. And most importantly, we have added to our already strong investment management and services teams so that we can continue our success.

The governance of the system and the dedication of our Board of Trustees have also played an important role in putting that foundation in place. By building on past success with an eye toward continuous improvement, SWIB has become a recognized world-class investment manager. A strong governance model allows us to be steadfast in our journey and to work through obstacles and difficulties the markets present.

SWIB is fortunate to have dedicated leadership in its nine-member independent Board of Trustees, which includes Department of Employee Trust Funds Secretary Bob Conlin. December was Bob’s last meeting as a SWIB Trustee, and his contributions will be missed. Bob’s record and dedication has been steadfast: he has served on the Board for the last seven years, has been serving the pension system at ETF for the last 14 years, and his career in Wisconsin is concluding with nearly 30 years of public service. It is because of the leadership of people such as Bob that the WRS is recognized as one of the top public pension funds in the nation.

This past year was not the first time we saw significant volatility in the markets, nor will it be the last. As we look ahead to 2021, there remains uncertainty. But, because of the work we have done, and continue to do, one thing members of the WRS can be certain of is Wisconsin’s pension system is well-positioned for whatever comes next.

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