2011 U.S. Investment Management Award Winner for Small Corporate Pension Plan

Ralph Egizi has done it his way. After taking over Eastman Chemical Co.’s pension fund in 1999, the former Ameritech Corp. assistant CIO crafted an alternatives portfolio that would outperform the equity markets in a downturn. But unlike many pension fund managers, Egizi created an alternatives plan without hedge funds. He felt that his staff at Kingsport, Tennessee–based Eastman Chemical — which had been spun off from photography giant Eastman Kodak Co. in 1994 — was too lean to provide the kind of oversight that hedge funds require, and he shunned the expensive fund-of-funds or consultant-led route.

He also believed that a 30 percent allocation to alternatives that included private equity, commodities, timberland and energy would serve the fund well. He was right: In 2008, when the Standard & Poor’s 500 index plummeted 37 percent, Eastman’s alternatives portfolio rose 3 percent, helping to cushion the blow for the pension fund, which had a –25 percent return. Through March the fund had an annualized return of 12 percent since inception. Active in industry affairs, Egizi, 63, currently serves as chairman of the Association for Financial Professionals’ Committee on Investment of Employee Benefit Assets, an advocate for employee-benefit-plan asset management and investment issues, representing more than 115 of the U.S.’s largest pension funds.

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