Minority Broker/Dealer Goals

Office meeting

Minority Broker/Dealer Utilization Goal

The Illinois Municipal Retirement Fund is committed to providing opportunities for minority owned and woman owned broker/dealers and broker/dealers owned by a person with a disability. The Illinois Municipal Retirement Fund Board of Trustees adopts a policy which sets forth goals for increasing the utilization of minority broker/dealers.

The minimum expectations for the goals of minority broker/dealers are based on commission dollars for Equities and par value for Fixed Income. Investment managers of separately managed investment portfolios and commingled passive equity index funds, in the following asset classes, must meet the minimum goals:

Asset Class Minimum Goal
U.S. Equities 25%
U.S. Large-Cap Equities 30%
U.S. Micro-Cap Equities 10%
International Equities 20%
Global Listed Infrastructure 20%
Fixed Income 25%
High-Yield Bonds 5%
International Small-Cap Equities 5%
Emerging Market Equities 5%
Commingled Passive U.S. Equity Index Funds  10%
Commingled Passive International Equity Index Funds 10%
Emerging Market Debt Best Efforts

Note: This broker/dealer goal will be reviewed annually. IMRF may allow current investment managers a limited transition period when minority broker/dealer goals are increased.

Investment managers are prohibited from using indirect methods such as step-outs to achieve these goals.

Investment managers of actively managed pooled/commingled investment portfolios are directed to use their best efforts to execute trades with minority broker/dealers. These efforts will be evaluated during semi-annual portfolio review meetings.

All external investment managers executing brokerage on behalf of the Illinois Municipal Retirement Fund are directed to meet these minimum goals in their specific portfolios and shall report monthly on their goals of minority broker/dealers. Any external investment manager failing to meet the minimum goal during the reporting month must provide a written explanation disclosing the reasons for not meeting the goal.

Internally managed portfolios are expected to meet or exceed the Fund’s current minority brokerage goals.

Transition managers are expected to meet or exceed current minority brokerage goals.

Staff will report to the Board of Trustees annually on the goals of minority broker/dealers. External investment managers not meeting the minority broker/dealer goals will be identified in the report. An external investment manager’s ability to meet a minority brokerage goal is an integral part of the manager monitoring process. Consequences for not meeting IMRF’s minority brokerage goals are situation specific and range from increased monitoring, placement on watch list, asset reduction, termination, and exclusion from receiving additional allocations/mandates.