In a public letter, Oregon Treasurer Elizabeth Steiner, MD, highlighted four investment principles she believes should guide Oregon’s investment strategy and the state Treasury’s reductions in private equity investments.

She sent the letter to members of the Oregon Investment Council (OIC) and the Beneficiary Advisory Committee, a body that represents members of the state’s Public Employee Retirement System (PERS). The OIC is beginning a review of Oregon’s asset allocation strategy, which the committee undertakes every four years.  

In the letter Treasurer Steiner called for Oregon to use its upcoming asset allocation review to take a fresh look at the way PERS funds are invested, given rapid changes in the national and global economies. “As a physician I believe strongly in making evidence-based decisions. The diversified strategies and asset allocations OIC and Treasury have pursued in the past must continue to meet OPERF’s need to generate the necessary growth, liquidity, and security today and tomorrow, at a time of profound change.” 

The Treasurer highlighted that Treasury staff have reduced the share of the PERS portfolio investments that have been made in private equity from 28% to 26%, bringing the state’s private equity holdings within the range the OIC has approved of 20%-26% of the fund’s assets under management. Treasury’s investment staff will continue to reduce that amount towards OIC’s target of 20%, which the Treasurer supports.  

Treasurer Steiner indicated that she was open to additional shifts in asset allocation within the portfolio, including the percentage of private equity holdings within the PERS fund portfolio. She said, “In an environment of high interest rates and stubborn inflation, it is important to balance risk and growth. I am open to shifting our allocations based on a wide range of inputs to navigate this environment.”

The OIC is a six-member board whose members, outside of the Treasurer and the Director of PERS, are appointed by the Governor. The five voting members will finalize the state’s next four-year investment strategy in late 2026. The OIC has begun to collect input from members and from outside financial experts on how to map Oregon’s next investment strategy. 

Treasurer Steiner’s letter reflects her own views and not those of other OIC members. 

The performance of Oregon’s investments affects the state’s 400,000 PERS members. Investment returns are one part of the calculation that the PERS Board (an independent body that is not associated with the Oregon State Treasury or the OIC) uses to set the rates that public agencies must pay into the PERS fund – along with a variety of actuarial, economic, and other factors.