Paying for Performance in Public Pension Plans

We examine the relation between public pension plan chief investment officer (CIO) compensation and plans’ performance. Higher paid CIOs outperform their counterparts by 47–60 basis points per year, largely through increased superior in private equity real estate. This outperformance generates an additional $74.91–$95.63 million economic value. Plans offering higher hire better educated are more likely to retain CIOs. CIO is positively correlated with use of incentive compensation, but does not directly affect Demand- supply-side frictions help explain variation pay persistent low some plans despite positive paper was accepted Victoria Ivashina, finance.