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NICE RETURNS
Buyout firm New Mountain Capital is looking to try a kinder, gentler approach in dealing with its institutional investors.
Last month the New Yorkbased private equity firm hired Michael Flaherman, former chairman of CalPERS's investment committee, with a mandate to reach out to investors in the $770 million New Mountain fund. Flaherman was once one of the firm's customers: In January 2000 CalPERS put $100 million into the fund as a founding investor.
New Mountain execs think that investors these days have concerns beyond returns -- for example, the willingness of private equity firms to disclose their performance. In bull market days, of course, those issues mostly got ignored. Flaherman may help to change that. For starters, he'll run an annual meeting where New Mountain investors can vent about any and all issues. "There's an attitudinal shift of treating investors with greater respect," says New Mountain CEO Steve Klinsky. "Flaherman brings a lot of experience and judgment on questions that are important to investors."
New Mountain execs think that investors these days have concerns beyond returns -- for example, the willingness of private equity firms to disclose their performance. In bull market days, of course, those issues mostly got ignored. Flaherman may help to change that. For starters, he'll run an annual meeting where New Mountain investors can vent about any and all issues. "There's an attitudinal shift of treating investors with greater respect," says New Mountain CEO Steve Klinsky. "Flaherman brings a lot of experience and judgment on questions that are important to investors."