In summary
CalPERS Chief Executive Marcie Frost earned $387,000 in 2017. She’ll take home at least $1.7 million this year after being awarded a record bonus.
CalPERS Chief Executive Marcie Frost snared her first seven-figure bonus, a milestone that follows a period of leadership stability and high investment returns at the nation’s largest state pension fund.
The California Public Employees’ Retirement System board awarded a $1.15 million performance incentive to Frost, who has led CalPERS since 2016. Last year, her bonus was $766,000.
The money is in addition to her base salary of $601,000. The board gave her a raise, too, bringing her salary to $641,000.
Frost joined the pension fund at a low point, when its assets were worth 65% of what it owed to members following its losses in the Great Recession. Since then, CalPERS began requiring employers to pay more toward their workers’ retirement plans, and it recently hit a three-year run of beating its investment earnings target.
The fund last year notched a 14.8% investment return, more than doubling its goal. Its portfolio, valued on June 30 at $637.1 billion, now is worth 85% of what it owes over time to members.
“Marcie Frost is a CEO on top of her game and delivering excellent results for CalPERS members,” CalPERS board President Theresa Taylor said in a statement.
Two of the board’s 13 members voted against Frost’s bonus, Mulissa Willette and a representative for State Controller Malia Cohen.
Board members met Tuesday in a closed session to discuss Frost’s performance and her incentive. Cohen’s delegate, Deborah Gallegos, read a statement before the final vote Wednesday that said the controller believed the compensation package did not reflect the full spectrum of views on Frost.
“The views of the board members with dissenting views were dismissed,” Gallegos said on behalf of Cohen. “I cannot stand behind a motion which does not equitably take into consideration all relevant factors, particularly in light of the current structural deficit in California.”
Several retirees also spoke against Frost’s bonus. They were affiliated with the group Retired Public Employees Association, which is led by former CalPERS board member Margaret Brown.
“There is something fundamentally wrong when public service compensation begins looking like Wall Street compensation,” Brown told the board.
Frost is not the highest paid official at California’s largest pension plans, CalPERS and the California State Teachers’ Retirement System. The funds’ chief investments officers, Stephen Gilmore at CalPERS and Scott Chan at CalSTRS, earn more in pay and incentives than the chief executives.
But by the quirks of the pension board meeting calendars, Frost is the first of the four to have her bonus disclosed each year. CalSTRS does not disclose its incentive pay until November.
Gilmore earned a total of $2.2 million in total compensation last year while Chan earned $1.4 million, according to records at the State Controller’s Office.
In some ways the rockiest period in Frost’s tenure was a five-year window when CalPERS had three chief investment officers. That position sets CalPERS’ overall investment strategy, aiming for an annual 6.8% return. Gilmore joined CalPERS in 2024 and ended the turnover at the top of the fund.
