Lisa Blatnick

This document outlines the project plan for CalSTRS to develop a shared vision to become a top global allocator, aimed at securing the retirement future and sustaining the trust of California's educators. Key attributes defining a top global allocator include a mission-driven mindset, world-class talent, smart execution, organizational agility, and being a partner of choice. The project targets evolving for future scale, remaining competitive in the global landscape, and achieving investment benchmarks of meeting or exceeding 7%.

The Shared Vision is a strategic initiative for CalSTRS designed to maintain its position as a top global allocator by ensuring the Investment Branch operates effectively at scale and aligns its investment strategy with long-term organizational goals. The initiative is structured in three phases: Listen and Engage, Review and Assess, and Vision and Strategy. Research conducted in the initial phases identified five key themes for sustaining performance over the next ten years: Mission-Driven Mindset, World-Class Talent, Smart Execution, Organizational Agility, and Partner of Choice. This structured approach aims to foster clarity, collaboration, and momentum toward a future-ready investment program.

Key discussions included public statements regarding divestment requests concerning Tesla, Apollo Global Management's labor issues, ESG concerns related to the Israeli/Hammas conflict, and specific companies like Lockheed Martin and Caterpillar. The Chief Investment Officer reported on the fund's overall value, risk, and portfolio mix, noting the continuation of the bull market driven by A.I., but also highlighting global market instability. Strategic priorities for 2025-2026, including diversification and liquidity management, were discussed. The committee also received updates on the CalSTRS Stewardship Priorities Annual Update, focusing on corporate accountability, the Net Zero transition, and workforce/communities, alongside discussions on engagement strategies in public versus private markets. The Private Equity Consultant Request for Proposal was approved.

The open session agenda included the approval of the committee agenda, opportunities for public comment, the Chief Investment Officer's Report, a discussion on Shared Vision: Research Insights, and semi-annual performance reports from the General Consultant ending December 31, 2025. The closed session covered the Chief Investment Officer's Report, semi-annual performance reports from the General Consultant (including RMS and SISS monitoring), Real Estate Consultant (ending September 30, 2025), and Private Equity Consultant (ending September 30, 2025). Further closed session topics included a tactical investment strategy discussion, consideration of investment decisions, and a conference with legal counsel regarding pending litigation. Consent actions included the approval of minutes from the January 29, 2026, Investment Committee Meeting for both open and closed sessions.

The committee agenda was approved. Key discussions included the approval of the Financial Consultant Request for Proposal and changes to the Audit Services FY 2025-26 audit plan. The committee accepted the FY 2025-26 Enterprise Risk Management and Compliance Services maturity plan progress report. Furthermore, the committee received a detailed presentation from the independent auditor regarding the CalSTRS Independent Financial Statement Auditor Reports for the Year Ended June 30, 2025, including the opinion section and internal control reports, adopting the related Proposed Resolution. It was noted that no Management Letter would be issued for the fiscal year ended June 30, 2025, due to a lack of reportable issues. The Enterprise Risk Management Report was presented, covering the current risk landscape, training completion, and discussions on information security and policy compliance.