The state of Michigan has pulled its $600 million pension fund from wealth management firm Fisher Investments after the company’s founder and chairman made crude and sexually explicit comments during a fireside chat at the Tiburon CEO Summit in San Francisco this week.
In a letter Thursday, Michigan Chief Investment Officer Jon Braeutigam informed the state’s investment board that its bureau of investments, housed under the state Treasury Department, had terminated its relationship with Fisher Investments of Camas because of CEO Ken Fisher’s “completely unacceptable comments.”
During a moderated keynote discussion Tuesday with Chip Roame, managing partner at Tiburon Strategic Advisors, Fisher compared his wealth management strategy to picking up women for sex, according to summit attendees who recounted what they heard in interviews with The Washington Post. Fisher spoke of doing acid and his belief that charities are immoral. He also made crude comments about genitalia, attendees said, and mentioned financier Jeffrey Epstein, who was indicted on federal sex-trafficking charges earlier this year before dying by suicide in prison.
Despite a Tiburon policy that requires summit attendees to keep private what they hear and discuss there, three CEOs publicly shared their accounts of what Fisher said in the interest of exposing his behavior and holding the self-proclaimed “self-made multibillionaire” accountable.
Alex Chalekian, founder and chief executive of Lake Avenue Financial in Pasadena, California, came forward first, posting a video to Twitter hours after Fisher’s remarks. Chalekian called the fireside chat a “true debacle” and said Fisher’s words were “absolutely horrifying.” Rachel Robasciotti, founder and chief executive of wealth management firm Robasciotti and Philipson in San Francisco, and Sonya Dreizler, a speaker and consultant to financial services firms, publicly confirmed Chalekian’s account online and in media reports.
They criticized the wealth management industry’s lack of diversity and cited incidents like Fisher’s Tiburon remarks as evidence of why women and people of color do not feel welcome.
“When you have power and you get onstage to share your worldview, and when your worldview includes women as sexual objects … That is irresponsible,” Robasciotti said in an interview with The Washington Post. “You’re peddling your worldview, and people are adopting it.”
Amid the backlash, Fisher was initially defiant in an interview with Bloomberg, defending his remarks by saying he had “given a lot of talks, a lot of times, in a lot of places and said stuff like this and never gotten that type of response.” He also claimed that attendees had mischaracterized what he said and were being unfair.
Fisher, 68, later issued a formal apology.
Roame denounced Fisher’s remarks, said he would never again be invited to speak at Tiburon. He praised Chalekian for speaking out.
Fisher had been previously honored at the Tiburon CEO Summit and has written 11 books, regularly writes newspaper columns on finance and has a net worth of $3.7 billion. He founded Fisher Investments in 1979, and it has grown into the world’s largest Registered Investment Adviser, managing $100 billion as of February, with $1 billion in revenue.
The firm manages both private, individual clients and institutions, like the state of Michigan’s pension fund.
Braeutigam said in his letter to the investment board that Michigan’s Bureau of Investment decided to fire Fisher Investments after learning of Fisher’s remarks from news reports.
“All were in unanimous agreement that prompt termination is the correct course of action,” the letter said. “There is no excuse to not treat everyone with dignity and respect. We have high expectations of our managers (and staff), not just with regards to returns but also in how they exhibit integrity and respect to all individuals.”
Fisher Investments had managed the state’s funds for 15 years, Braeutigam said in the letter, writing that the firm’s “performance has been good (beating the S&P 1500) in staff’s interactions we have not previously witnessed or been aware of any type of similar comments along the lines of the founder’s recent statements.”
“In our opinion, this history does not out-weigh the inappropriateness of the comments made by the founder,” Braeutigam wrote.
The state of Michigan’s in-house investment team will now manage the retirement funds for state employees and public school teachers, state officials said.
