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SWIB Reports 5-Year Performance Adds $3.1 Billion Above Benchmarks, Awards Incentive Compensation

State of Wisconsin Investment Board (SWIB) Trustees awarded incentive compensation based on more than $3.1 billion of net outperformance generated by SWIB staff over the last five years for the fully funded Wisconsin Retirement System (WRS). Due to SWIB’s strong investment performance, WRS retirees will see a Core Trust Fund annuity adjustment of 3.6% and Variable Trust Fund annuity adjustment of 15%.


In recognition of staff outperformance, the Trustees awarded incentive compensation payments totaling approximately $30 million. Cost-effective internal management that generated strong investment returns has helped the WRS remain among the best-funded public pension plans in the country. Over the last 20 years, SWIB’s active management and its diversified holdings generated $29.5 billion for the Core Trust Fund above what it would have earned by simply investing in a passive portfolio consisting of 60% global equities and 40% domestic bonds.


In 2023, SWIB beat its one-, five- and ten-year benchmarks for the Core Trust Fund. The one-year net return for the Core Trust Fund, the larger of the two WRS trust funds, was 11.4%. The five-year net return was 9.3%, and the ten-year return net of external manager fees was 7.1%. By exceeding the WRS actuarial target return for all periods, including the five- and ten-year periods, SWIB also helps provide continued stability in employer and employee contribution rates.


“The WRS trust funds had a strong performance year. Despite numerous challenges, we remained committed to our long-term investment strategy that aims to keep annuity adjustments and contribution rates stable and meet the benefits promised to over 677,000 WRS participants,” SWIB Executive Director/Chief Investment Officer Edwin Denson said. “WRS retirees have seen positive annuity adjustments in nine of the last ten years, and contribution rates have hovered between 6.5 and 6.9 percent. That highlights not only the thoughtful design of the WRS, but also the efforts of SWIB staff to protect participants from large swings in annuities and contributions.”


“SWIB’s market-based compensation plan is designed to attract and retain highly qualified staff to manage a sophisticated long-term investment strategy at a competitive cost to WRS participants,” SWIB Board of Trustees Chair Clyde Tinnen said. “Performance-based compensation supports lower-cost in-house investing, prudent use of active management, greater investment diversification, and innovation to keep up with constantly changing markets.”


Incentive compensation, the pay-for-performance part of employee compensation, was awarded to 263 employees and is based on an employee’s contributions to the overall success of the organization and trust fund performance after deduction of all costs. The incentives equate to less than 5% of all costs for managing the WRS. Incentives are based on delivering value above industry benchmarks set by the Trustees with the advice of an outside independent consultant, a practice used throughout the industry. The plan sets total compensation targets using peer group data and primarily focuses on five-year returns, a longer-term measure that aligns with SWIB’s long-term investment strategy and the period used to calculate annuity adjustments. Compensation to SWIB employees provides a considerable cost savings advantage for the WRS over the fees charged by external investment managers.

SWIB Trustees also granted long-term incentive units to senior employees, who constitute less than one-third of staff, that will be eligible for payment in 2027. Long-term incentives are a common component of industry compensation that promote the recruitment and retention of critical staff and further align employees with the interests of WRS beneficiaries, as the value of the units is determined upon vesting based on the long-term performance of the Core Fund.


About SWIB

The State of Wisconsin Investment Board (SWIB), created in 1951, is an independent state agency responsible for managing the assets of the Wisconsin Retirement System (WRS), the State Investment Fund (SIF), and other state trust funds. As of December 31, 2023, SWIB managed more than $155 billion of total assets, approximately 85% representing WRS assets. SWIB’s management of the WRS trust funds aims to provide a fully funded public pension for over 677,000 current and former employees of state agencies, the university system, school districts, and most local governments. The WRS consistently ranks among the 10 largest public pension funds in the U.S.  For more information about SWIB, visit


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