It has been reported that on October 25, the North Dakota State Investment Board decided to drop several of its active equity mandates in favor of passive strategies, citing fees and performance issues.

The results are that State Street Global International Alpha and Clifton EAFE Index mandates have been switched to a Pure Passive MSCI World ex-US mandate. Also, UBS Emerging Market Equity and PanAgora Diversified Risk Emerging Markets Equity Plus mandates have been switched to passive mandates.

The Board, which manages the assets of the North Dakota Public Employees Retirement System, is not alone among large pension funds and other public investors that have moved their equity strategies to more passive mandates.

Notably, the Board decided to “transition the assets currently managed by Calamos [Investments] to the existing Epoch Global Choice mandate due to poor performance and organizational changes at Calamos,” according to minutes made available on the Board’s website. Darren Schulz, the then interim CIO, made the recommendations to the Board.

Calamos received its low-volatility global equity mandate in January 2012, when the Board decided to change from Calamos’s convertible bonds mandate.

The organizational changes the Board cited are most likely in reference to James Boyne’s announced departure from Calamos. James Boyne joined Calamos in 2008 and eventually became the firm’s President and COO. He left in September of 2013.

Another headline-making departure was that of Nick Calamos, nephew of Calamos founder John Calamos Sr., who resigned his post as co-CIO in 2012. He remained a member of the board until early December 2013, when he decided to officially leave the firm, sell his shares and engage in philanthropic pursuits.

Calamos in particular has posted some unpleasant net outflows in recent quarters: US$ 2.5 billion, US$ 2.3 billion and US$ 980 million in Q1, Q2 and Q3, respectively, according to an October earnings call: rather sizeable outflows for the US$ 27.5 billion asset manager.

The Board, which manages the assets of the North Dakota Public Employees Retirement System, is not alone among large pension funds and other public investors that have moved their equity strategies to more passive mandates.

The California Public Employees’ Retirement System (CalPERS), with US$ 270.5 billion in assets under management, as of September 30, 2013, is a leader in the press and among peers. Their returns since embracing passivity have been met with expectations and their codifying of this belief in passive strategies in a white paper titled “CalPERS Investment Beliefs” suggests they will continue moving more equity allocations toward indexing, and where they tread, surely more institutional investors will follow.