The president of the board of administration of the Californian Employees' Pension Retirement System (Calpers), Dr William Crist, was in Thailand last week, effectively patting the country on the head for its improvements in corporate governance. But the good doctor said that more work must be done if Calpers' stringent demands for transparency were to be met. A lot has been written about Calpers and its work in Asia since it decided in February that certain swathes of the region - notably Thailand, the Philippines, Malaysia and Indonesia - were deemed off-limits by their watchdogs, for shoddy corporate governance. This was followed, just a few weeks later, by an embarrassing U-turn after it was discovered that some of the information used to condemn these markets was, well, just plain wrong. All this would be amusing but for two unavoidable facts. One, that Calpers is the largest pension fund in the United States, with US$143.3 billion under management and so, by sheer bulk alone, carries significant weight in global markets. And two, that the Pecksniffs in charge of this fund are responsible for the nest eggs of nearly 1.3 million people. Only last week the fund announced that it had fired Goldman Sachs Asset Management, and placed three more managers on a 'watch' list, for underperforming in their management of their US equity holdings. In the past fiscal year, Calpers' portfolio shrank 5.9 per cent. The underperformance cannot be blamed on the withdrawal from the Asian markets as this policy was only announced in February. The losses of the past four years were more likely due to the fund's investments in US corporates. Calpers likes to present itself as a corporate watchdog, using its sheer bulk to get companies to shape up. This clearly did not happen in the cases of Enron Corp and WorldCom. The fund has been forced to come clean about its involvement with the two companies. It released a statement saying that it had realised and unrealised losses of about $235 million due to exposure to WorldCom stock. The fund also held Enron and WorldCom debt to the tune of $388 million. These losses are mitigated somewhat by the $132.5 million that the fund made in 1997 from the sale of its half of a partnership formed with Enron called Joint Energy Development Investments, or JEDI. JEDI was one of many off-balance sheet partnerships that Enron created to squirrel away liabilities and deceive investors. Although Calpers walked away from involvement in subsequent partnerships with Enron, the fund remained invested in Enron equity and debt. Having lost hundreds of millions of dollars in employee pensions, the fund has been fairly unrepentant in public. US litigiousness surely plays a part - any admission of culpability would have the lawyers sharpening their knives. But we cannot help but feel that Calpers sincerely believes that it has been entirely blameless in the boardroom debacles which merged in the late 1990s. 'The WorldCom situation underscores the need for greater ethics, transparency and accountability in the world's financial markets,' said Calpers, in a press release shortly after the report about Bernie Ebbers and Co broke. Calpers spokeswoman Patricia Macht had this to say about the Enron mess: 'Had we known then what we know now, obviously we would not have made any investments in Enron. No one can turn back the clocks, however.' Thanks for the words of comfort. This is not to say that we in Asia do not have any problems with corporate governance - we do, and they need to be addressed. But, much like Keith Richards lecturing your children not to do drugs, a Calpers official flying into the region to lecture on corporate governance leaves a bad taste in the mouth.