Iowa’s $46 Billion Pension Fund Paid Its CIO “Exceptional” Performance Pay — No One Will Say Why
Three years. Three $25,000 payments. No public scorecard.
The difference between a good year and a bad one at Iowa’s largest public pension fund can come down to the width of a pencil lead.
In the fiscal year that ended June 30, 2025, the Iowa Public Employees’ Retirement System (IPERS) earned 9.87 percent on its investments. Its “policy benchmark” — the yardstick the board uses to judge success — was 9.85 percent. IPERS beat it by two‑hundredths of a percentage point. On a $46 billion fund, that tiny edge translates into roughly $9 million in what the industry calls “value added.”
It was not a one‑off. IPERS has beaten its benchmark every year since fiscal 2020, five years running, never by as much as a full percentage point. When the margin between beating the market and trailing it is that thin, the interesting question stops being “what’s the score?” It becomes “who’s holding the ruler?”
At IPERS, that question leads quickly to a line in the state payroll system.
For the calendar years 2023, 2024 and 2025, a single entry appears next to the name of Chief Investment Officer Sriram Lakshminarayanan:
Exceptional Job Performance Pay — $25,000.00.
Among the executives whose records the state produced, no one else received money under that label. The amount is not arbitrary. It matches, to the dollar, a cap IPERS wrote into its own budget documents as the maximum incentive payment allowed per investment employee.
IPERS’ stated purpose for the incentive program is to reward “investment staff decisions that add value over and above stated benchmarks” — the definition, in investment slang, of alpha, or return beyond what the market would have provided anyway. In plain English, it is a bonus for beating the ruler. But in thousands of pages of board minutes and budget records released so far, there is no public explanation of who decided the CIO’s work was “exceptional,” what benchmark they used, or whether anyone independent checked the math.
The Payroll Receipt
The state’s own records settle at least part of the story.
In response to an open‑records request, Iowa’s payroll custodian produced five pages of compensation tables for IPERS executives, one page per year from 2022 through early 2026. Most columns are routine: regular salary, holiday, sick pay, vacation. On the pages for 2023, 2024 and 2025, an extra column appears: “Exceptional Job Performance Pay.”
In each of those years, Lakshminarayanan’s entry reads $25,000.00. The entry for CEO Gregory Samorajski reads zero. So do the entries for every other listed official. Over the same period, the CIO’s total gross pay rose from about $291,000 to roughly $368,000 — about 27 percent — while the CEO’s rose about 14 percent before his departure on May 1st.
The payroll tables answer the first questions cleanly: the money was real, it was labeled as “exceptional” performance pay, and it went to one person. They answer nothing else about how that label was earned.
The Program Behind the Number
Other records show where the $25,000 figure comes from.
Minutes from a December 2024 board meeting note that IPERS’ next budget request would “remove the current cap that limits incentive compensation payments to investment staff at $25,000 per year/employee.” Three payments, three years, one number — the maximum the program allows.
That structure creates an odd result for a system built on very small margins. Whether the fund beats its benchmark by two basis points or by two percentage points, the award at the cap is the same. The plan’s own materials told board members that new strategies “could add hundreds of millions of dollars of extra return,” but the maximum reward for the CIO is a flat $25,000 either way.
What must be done, specifically, to earn the “exceptional performance” label has never been made public.
The subject of bonuses surfaces directly in public only once in the records reviewed — in a finance podcast. When host Angelo Calvello pressed Lakshminarayanan about public‑fund compensation, the CIO said IPERS was within “striking distance” of hedge‑fund pay. When Calvello suggested “maybe there’s a discretionary bonus popping up or something,” Lakshminarayanan laughed and replied, “No, no, no. Let’s not open that door.” The exchange is light. In the written record, the door stays shut.
Two officers, Two Systems
The way IPERS handles executive pay in public differs sharply depending on the job.
For the chief executive, every raise appears in open session. Board minutes from 2021 through 2025 record votes to move Samorajski to a higher pay grade and to award cost‑of‑living increases — 5 percent one year, then 2 percent, then another 2 percent — each approved by recorded roll call, sometimes over a dissenting “no” from the state treasurer.
For the chief investment officer, there is no such trail. In six years of minutes reviewed for this article, there is not a single open‑session vote, dollar amount, or explanation of the CIO’s pay. Instead, the minutes show a recurring pattern each spring: a motion that the board “go into a closed session… to discuss the CIO’s annual performance evaluation and the CEO’s compensation as authorized by Iowa Code section 21.5(1)(i),” followed each time by the sentence, “The Board took no action during its closed session.”
The statute the board cites allows closed‑door evaluations only when they are necessary to prevent “needless and irreparable injury” to an individual’s reputation and when that individual requests a closed session. The minutes record that the board met behind closed doors. They do not record the CIO requesting it, as the law requires. That omission may reflect paperwork the public has not seen, but on the face of the record, even the legal basis for closing the door rests on a condition no one has documented.
In 2022, Lakshminarayanan’s first full year as CIO, the minutes record no evaluation session at all. The first agenda to list “CIO Compensation” alongside a closed session is dated March 27, 2026; IPERS has not released minutes from that meeting.
What the public documents do not show, after three years of maximum “exceptional” payments, is who made that judgment or what they measured.
The Structure Behind the Silence
That blank is not sloppy filing. It is what IPERS' design produces.
Iowa's pension system is not built like most. At large public funds, a governing board hires, oversees, and can fire the chief executive. IPERS’ Investment Board is the trustee of the fund — it governs the portfolio, the policy, the actuary — but the agency itself “is administered by its chief executive officer,” who is appointed through the executive branch rather than hired by the board.
The board’s documented powers over its CEO amount to two: setting his salary and recommending his reappointment to the governor. It does not employ him. A former IPERS chief operating officer, Leon Schwartz, put it bluntly to the Financial Times this spring: "Compared to most public pension systems, IPERS has a quite weak governance structure."
That matters because the board appears to evaluate performance without holding the ordinary employment power a governing board would usually carry.
And the function meant to check the numbers sits inside the very operation it checks. IPERS' policy assigns risk oversight to two officers — the CIO, and a chief risk officer responsible for the systems that measure investment risk, with a duty to report any breach of limits to the board.
So the issue is not simply one person grading his own homework. It is a structure in which the public cannot see who wrote the test, who graded it, or who checked the grade.
The Benchmark That Grades Itself
The “exceptional” label matters because of how IPERS defines success.
In its Investment Policy and Goal Statement, a footnote to the asset‑allocation policy says:
“The benchmark index for each private market asset class is the return of the portfolio itself.”
In practice, that means private equity, private credit and private real assets — roughly a quarter to a third of the portfolio — are graded, inside the fund’s main benchmark, against their own returns. That slice of the book can never beat its benchmark and never trail it; it is the benchmark.
IPERS points out that private portfolios lack simple, investable indexes and that the rule is disclosed in both its policy and audited financial report. The fund also applies a separate, longer‑term test to private markets: beating the Russell 3000 stock index by three percentage points over rolling ten‑year periods. All of that is true.
But the ten‑year test does not appear in the annual number the board and public hear, and the one‑page summaries IPERS distributes to members describe the policy benchmark only as “a passively managed set of market indexes, with appropriate weightings” — with no mention that a large segment is benchmarked to itself.
The headline margins are thin. Since fiscal 2020, IPERS has outperformed its benchmark each year by between 0.02 and 0.80 percentage points. Within those narrow gaps, any portion of the portfolio that is impossible to fail matters.
The same reports that help IPERS tout its results raise questions about how much “value added” there is to reward. Each fall, the board hears from CEM Benchmarking, a Toronto‑based firm that compares plans’ costs and performance. Minutes from September 2023 say that IPERS “once again ranked as a low‑cost fund” and that its five‑year net value added was 1.7 percent, beating the peer median of 0.8 percent.
Inside CEM’s own report, however, a table discloses that before CEM adjusts every fund’s private‑equity benchmark to a standardized public‑market index, IPERS’ five‑year net value added was 0.1 percent. The higher 1.7 percent figure — the one quoted in minutes — depends on a modeling choice the board never discusses in public.
None of this proves IPERS designed its benchmark to flatter results or that any award criteria used those numbers. It does show that a fund promising to pay for “value over and above stated benchmarks” is operating with a benchmark that, for a significant portion of the portfolio, cannot be beaten or missed.
Who Builds the Scoreboard
The public record is clearer on who assembles and presents the scoreboard the board sees.
IPERS has relied on the consulting firm Wilshire for more than 35 years. In 2021 the board renewed them on a six‑year contract and expanded its mandate to include “private markets advisory services,” along with access to new risk‑analytics dashboards. Minutes and agendas show its consultants presenting the fund’s annual performance review, leading a “benchmark education” session, walking through asset‑allocation changes, and briefing the board on “active risk” at every regular meeting in the past year — including immediately before the March 27, 2026 closed session on CEO and CIO compensation.
On the private‑equity side, the dominant manager is Pathway Capital Management, which runs a dedicated fund‑of‑funds valued at about $7.3 billion — roughly 90 percent of IPERS’ private‑equity portfolio. Board packets credit Pathway as the source of IPERS’ private‑equity program summaries. Because private markets are benchmarked to their own returns inside the policy benchmark, Pathway’s performance is both the grade and the grader for that slice of the fund.
Pathway’s own biography of senior managing director and co‑founder James Reinhardt adds another layer: before starting Pathway, it says, he “cofounded the Special Investments Division of Wilshire Associates Inc., which focused exclusively on assisting institutions with investment in the private equity asset class.” Wilshire does not own Pathway, and nothing in the records reviewed suggests it does; each firm has private‑equity owners of its own.
The point is narrower than ownership. The consultant that helps design and explain IPERS’ private‑markets program, and the manager that runs most of it and supplies the numbers that feed the benchmark, grew out of the same firm — and there is no public record of any relationship map, conflict‑of‑interest disclosure, or independent validation of the Pathway‑sourced data the board receives.
IPERS has not responded to detailed questions seeking comment on these issues or on how, if at all, their reports and benchmarks are tied to the CIO’s “exceptional job performance” pay.
What the documents show, after three years of maximum performance bonuses, is a closed loop: the fund sets the benchmark that grades its own results, outside firms paid by the fund help construct and present it, and the only people who know how that loop translates into “exceptional” are the ones inside the room the public never sees.
The Missing Risk Officer
One of the safeguards meant to stand between the portfolio and the bonus is missing from the public record.
IPERS’ own policies assign risk oversight to two people: the chief investment officer, and a separate chief risk officer responsible for developing “systems, models, tools and reporting processes” to measure investment risk and for reporting any breach of limits to the board. Lakshminarayanan held that risk job himself for eight years before becoming CIO in 2022.
Minutes show the board meeting his successor, Rich Wiggins, in September 2022 and hearing risk reports from him that fall. After December 2022, Wiggins disappears from the minutes. There is no recorded discussion of his departure or of a search for a replacement. State payroll records show a termination vacation payout and a negative relocation entry by his name in 2023.
From March 2023 through at least December 2025, every fund‑level risk report to the board is presented by the CIO himself.
At all eleven regular meetings in that span, the man who runs the portfolio is the man who tells the board how risky it is.
Wiggins is now suing the state, claiming he was fired after raising concerns about IPERS’ risk reporting, benchmarks, and fee disclosures, and alleging that after his termination, executives “requested money in the form of bonuses” based on misleading information. The state denies every substantive allegation, and no court has found his claims true. The payroll records independently confirm only one narrow overlap: performance‑labeled payments to the CIO exist, begin the year he was terminated, and do not include the CEO also named in his suit.
What IPERS Still Owes the Public
IPERS is not in crisis. By national standards, the fund is large and comparatively healthy, and benefits are being paid. The issue this story surfaces is smaller and harder to see: a structure in which the benchmark that helps define “exceptional” is partly self-referential, the data that feed it come from firms whose relationship map does not appear in the public record, no replacement for the former risk officer appears in the minutes reviewed, and the criteria for the only documented performance bonuses remain behind a closed door.
Those are questions lawmakers, auditors and 424,000 members can answer without a subpoena. The documents that would settle them are specific and short: the incentive‑pay plan, the award scorecards and approvals, the closed‑session requests required by law, the current risk‑oversight chart, and any conflict‑of‑interest and validation records for the private‑markets program.
Until those are made public, “exceptional job performance” at Iowa’s $46 billion pension fund is a judgment taxpayers and workers are being asked to take on trust — from the only people who know what it means.
References
Court filings — Wiggins v. State of Iowa
Wiggins v. State of Iowa, No. LACL163118 (Iowa Dist. Ct., Polk County, petition filed July 14, 2025).
Wiggins v. State of Iowa, No. LACL163118 (Iowa Dist. Ct., Polk County, amended petition filed Jan. 30, 2026).
Wiggins v. State of Iowa, No. LACL163118 (Iowa Dist. Ct., Polk County, answer filed May 21, 2026).
Board minutes and agendas — IPERS Investment Board
Iowa Public Employees’ Retirement System. (2021, December 2). Investment Board meeting minutes.
Iowa Public Employees’ Retirement System. (2022). Investment Board meeting minutes, calendar year 2022
Iowa Public Employees’ Retirement System. (2022, September 22). Investment Board meeting minutes.
Iowa Public Employees’ Retirement System. (2022, September 22). Investment Board meeting materials [Board packet, p. 8].
Iowa Public Employees’ Retirement System. (2022, December 1). Investment Board meeting minutes.
Iowa Public Employees’ Retirement System. (2023, March 24). Investment Board meeting minutes.
Iowa Public Employees’ Retirement System. (2023, September 28). Investment Board meeting minutes [Board minutes, p. 2].
Iowa Public Employees’ Retirement System. (2023, December 7). Investment Board meeting minutes [Board minutes].
Iowa Public Employees’ Retirement System. (2024, March 22). Investment Board meeting minutes [Board minutes].
Iowa Public Employees’ Retirement System. (2024, December 6). Investment Board meeting minutes [Board minutes].
Iowa Public Employees’ Retirement System. (2025, March 28). Investment Board meeting minutes [Board minutes].
Iowa Public Employees’ Retirement System. (2025, September 25). Investment Board meeting minutes [Board minutes, p. 2].
Iowa Public Employees’ Retirement System. (2026, March 27). Investment Board meeting agenda [Board agenda].
Iowa Public Employees’ Retirement System. (2023–2025). Investment Board meeting minutes [Board minutes for the risk-report presenter series: 3/24/2023, 6/15/2023, 9/28/2023, 12/7/2023, 3/22/2024, 6/20/2024, 9/26/2024, 12/6/2024, 3/28/2025, 9/25/2025, 12/5/2025].
Benefits Advisory Committee / governance description
Iowa Public Employees’ Retirement System. (2022, January 24). Benefits Advisory Committee meeting minutes [BAC minutes, p. 2].
Iowa Public Employees’ Retirement System. (n.d.). Benefits Advisory Committee responsibilities [Governance description].
Annual financial report
Iowa Public Employees' Retirement System. (2025). Annual comprehensive financial report, fiscal year 2025 [PDF].
Policy documents
Iowa Public Employees’ Retirement System. (2022). Investment policy and goal statement (effective July 1, 2022) [Policy document].
Iowa Public Employees’ Retirement System. (2022). Private markets investment policy (effective Oct. 1, 2022) [Policy document, § I.C].
Iowa Public Employees’ Retirement System. (2024). Portfolio market value & investment returns.
Payroll and public-records materials
Iowa Department of Administrative Services. (2026). Executive compensation tables, Iowa Public Employees’ Retirement System, calendar years 2022–2026.
Restoring Democracy’s Promise. (2026). Iowa open records request: IPERS executive compensation, bonuses, and related payroll records.
Benchmarking report
CEM Benchmarking Inc. (2025, December 5). Iowa PERS: CEM investment benchmarking report DB – 2024 [Benchmarking report].
Statutes
Iowa Code § 21.5(1)(i) (2025). https://www.legis.iowa.gov/docs/code/21.5.pdf
Iowa Code ch. 97B (2025) [pdf].
Podcast
Calvello, A. (Host). (n.d.). Beyond fee savings: How IPERS uses co-investments to build investment talent (No. 13) [Audio podcast episode]. Angelo Calvello’s podcast.
News article
Yu, S. (2026, May 9). Iowa pension chief resigns amid concerns about performance figures. Financial Times.
Corporate / firm sources
Wilshire Advisors LLC. (2021, January 13). Wilshire announces new leadership team members and growth vision at the acquisition close.
Wilshire Advisors LLC. (2021, August 9). Wilshire retained as investment consultant for Iowa Public Employees’ Retirement System.
Pathway Capital Management. (n.d.). James H. Reinhardt [Firm biography]. Retrieved June 11, 2026.
Prior reporting (cited as in-text links)
Restoring Democracy’s Promise. (May 19, 2026). A resignation is not an audit: Why Iowa still owes IPERS members answers [Investigative report].
Restoring Democracy’s Promise. (April 6, 2026). Newly Obtained Amended IPERS Lawsuit Expands Allegations on Risk, Fees, and Benchmarking [Investigative report].
well done!