exhibits of art, local artists, school projects. i would like to see a lot of that. this is a tech city in the tech part of the world. we need to make the best of that in my opinion. i like the simplicity. i think you've done a wonderful job on creating the maintenance and the kit parts or whatever it's called. i have the same concerns about the landscaping. i had not thought about looking at it from above. so i respect that concept. i think the landscaping is the least important part of these. the kiosks and the toilets themselves are the most

important. what will matter tremendously here, the materials. and i'm very worried about the scratch-resistance because i think that's the form of graffiti that will be the hardest to maintain. without seeing a materials board, it's hard to comment on that, but it will be critical. one final comment. i'm sure there's an historic district reason for this, but on the kiosks, i prefer the rounded corners. i think they're superior, if you can make that work. >> commissioner wolfram: thank you. >> i just wanted to note that part of the old, historic -- the old design of the kiosks, one of the generous contributions that

jcdecaux had partnered with the arts commission has been providing resources to support the display of the related exhibition materials or promotional materials, i should say, so we've had the benefit of being able to showcase art organizations and artists and we're in conversation to see how we can continue that in this arrangement. >> commissioner wolfram: thank you. >> commissioner hyland: i have a couple of questions and then some comments. i don't know who would best be to respond to them, but where will the double toilets go? i'm assuming that the historic districts, which is the areas that we'd be most concerned, or the higher traffic areas and would need the double toilets? >> beth rubenstein, san francisco public works. actually want to respond to the

interactivity, but first about the double toilets. we're looking at up to 12 sites. and -- but it has a lot to do with the negotiation of the contract. complexity of the design influences the contract. the sites of interest to you would be civic center plaza, the port is interested in the double toilets, twin peaks is also interested in the double toilets. there are other ones. u.n. plaza. so u.n. plaza and civic center plaza that would be under your jurisdiction. i don't think any of the others. >> commissioner hyland: not coit tower or washington park? >> no, definitely not.

>> commissioner hyland: and on twin peaks, how would access be? >> right now, there are two toilets up there. >> commissioner hyland: there are? >> yes. two single-stall toilets. so there's an idea to put two double toilets up there. likewise, two adjacent toilets on jefferson near fisherman's wharf. it's just the number of flushes. it's incredible. there are 800,000 flushes, so tows are in high-traffic youras. and just to respond to the question about interactivity, which we believe is important. of the 114 kiosks, i believe that 69 of them are newsstand kiosks. when the contract was written, it was written in a way that only media outlets could activate those. so we've activated them -- there's an artist that has

activated down at the embarcadero plaza and she can do that because she's kind of a media outlet. otherwise, we've had to keep them closed, except for pop-up events. with the new contract, of the 114, we'll replace 20 with micro business kiosks that function kind of like the newsstand, but the contract is written that it could have multiple things. for cast rove -- castro and market, they would want a tourist information stand. there could be a coffee stand. we had bike repair. so something like that. and then to director keehn's point, the architect talked about the three-sidedness of it. two of the three panels are general advertising and those

are the panels that face market street. it's been programmed by the arts commission, which our intention is that that would continue and that's the side -- that's really important to us and that's an important benefit and that faces the sidewalk, too. >> commissioner keehn: on the foundations, it was mentioned that the round foundations would have a rectangular piece over them. what about the foundations for the toilets? will they be replaced? what will happen with the scar where the old foundation is? that will be a visible remnant. >> francois, jcdecaux. for the public toilets, the foundation is 18 inches below grade. when you remove the toilet and put on the new one, you will not

see it. >> commissioner keehn: they're not the same footprint, though? >> no. once we have the final design, we know that we will have to do some seismic analysis to get it approved, but they're larger. >> commissioner keehn: maybe there is something that could be addressed at the base that would not make it look like a -- something that wasn't thoughtful. the scars. that's something to think about. i do have some comments. what's interesting is over the years, the interpretation of standard 9 kind of swings back and forth and the notion of historic settings keeping awe yet differentiated. i've never personally liked the

current toilets. i think they're very parisian or whatever i consider are parisian. and when i think about paris, i think of all the evolution of design and the metro stations and how they're different. our toilets are art deco, kind of fake parisian something. i don't know. that's my personal opinion. i do think that having a sculptural element can be very successful and we may be in a period of time when we're swinging more into the contemporary design than in the more keeping, in keeping with the historic. i think of the pyramid at the louvre. and when it was first built, is with there when we were building it for school, but i didn't like it, not that i didn't like the form or the solution, but the fact that the designer said it would be transparent and we knew it would not. it was a glass box that

reflected everything. so on this, i think one of the challenges -- i'm on the architectural review committee as well. and one of the concerns that i had when we had the initial toasters, buses, whatever, linear forms, is that they would be more massive than what is current. this is addresses that in a good way. i think the design that we have allows it to be everywhere. there's a cohesion and it will fit within the historic districts, so they don't necessarily different. the other comments that have been made, i can run through and agree with. i do prefer on the kiosk, the pillowed version. i think if we can get a more

pronounced web in here, i would -- it seems like it was more pronounced. and i agree with commissioner wolfram, with the view from above. if we don't have green roofs, especially on market street, that surface needs to be treated so it doesn't look like a mechanical skylight well. so that would be important. and lastly, keeping it simple, keeping it to a sculptural form. and not mucking it up with amenities around ground floor benches. i think you are complicating the solution. good job. >> commissioner wolfram: thank you. any comments on this side? okay. so -- any comments on this side? >> commissioner johnck: i want

to add to the discussion about the standard 9 and the relationship to our mission here and i do think that the design and, of course, our photo here, when i first saw it without thinking about anything else i did like it, i said, this works for our standard 9 interpretation. and being more modern in contrast. so i generally like that approach. i did want to say to echo more about the public interpretation or interactivity of the toilets and the kiosk. i see there is staff from the port here. when we get to one of the kiosks and the toilets and there are

maps there and i point out historic sites and point out to where we're standing. and i think i would like to see how a new form, new shape looks like with the panels on them. for the sponsorship of cultural events or add ver use itting information. but the historic interpretation, whether it's a map or a marker or something, talked a lot about doing more with our plaque program for historic landmarks. so how these amenities, furnishings fit into the public interpretation with the panels on the side. i would like to see more pictures of that. it could work and i would like

some more details about how our two commissions work together on the programming for that. >> commissioner hylan >> commissioner hyland: i do but -- >> commissioner pearlman: i thought it was interesting to hear about the different plants on the different kiosks and i started to imagine like boston the freedom trail. we have the toilet trail, going from one to another. [laughter] that bothered me. the idea of looking down on these, there's another something that could be paid attention to. the idea that you walk in there and it's lit, but not viewed, something could solve that.

i want to echo what commissioner johnck said. the way-finding in our city is not very good in general. having been to many european cities, as well as american cities that do it better than we do. in terms of having description of the area where you are or other signs that describe historical events that might have happened in that location, etc. this is a great opportunity that offers, in place where's it's not right up against the curb, where you might be on the embarcadero where you could have the operation manual next to the door but on the opposite side, also something that then has the map and information and something about that location. i think would be really, really beneficial and a great amenity to add to that.

if you are 18 inches away from the curb, you don't want to put it there. otherwise, i think it would be a great addition to these. >> commissioner wolfram: yeah. where you are on the toilet trail. [laughter] >> commissioner pearlman: right. and is that grass or lavender on the roof? >> commissioner hyland: real quick as a follow-up to commissioner johnck and commissioner pearlman, on the interactive displays. we've been talking to project sponsors, ocean wide, is it? they will have some interactive interpretive kiosks based on what was lost in that area. we've also talked to the various departments with the cultural heritage assets committee and having an ability to tie in and i think the cultural center is under the commission's purview,

right? a lot of the oral histories and a lot of the cultural, intangible, cultural assets, that were expanded by the cultural centers, having access to the information. i don't want to expand the scope of their contract, but it's the archivist at the library. there's an immense amount of information that's digitally available and having that as somehow incorporated into wherever we can get it incorporated so they can be connected and accessed would be good. >> beth rubenstein, public works. i forgot to mention, thank you, that there are three types of kiosks. one is a standard advertising kiosks with three panels. the second is micro-business. and the third is interactivity one. that would have an awning and have a panel for interactivity.

it's exactly to your point. it would probably be digital, map, way-finding, history of the site. and we're really excited period tha -- about that. and i've been talking to community groups about seeing the kiosk as an amenity. it's good to know that you have the partners and we've reach out when it's time to figure out who is doing that. >> commissioner wolfram: when thing i've been thinking about that is an interesting precedent for us on this commission is the b.r.t. and the fact that in that location at civic center location, theres with a light standard that we approved and the city wanted to do a historic fixture, but one that looks

quasi-historic. when you get out of the district, you go to the fake historic ones. so it's a little piece of architecture in the historic center. >> commissioner hyland: we came up with a cleaner, elegant, modern station, in the midst of the civic station and worked with d.p.w. >> commissioner wolfram: interesting, would we approve the toilets on the streets today? probably not. i want to congratulate the team on all the work they've done, impressive materials. i personally have plants that

are an interesting idea and i can understand the concerns that others have expressed. i like the development of the toilet. i think the kiosks themselves still need further development. i want to be sure they have a relationship to the toilets as well. that there is continuity between those. that they don't diverge too much. i want to congratulate you on your great work to date. >> commissioner hyland: i don't know if staff is here to answer this, but as it progresses and the c of a is applied for, the locations within the historic district will come back before us. >> correct. >> commissioner wolfram: because it's a prototype toilet, a sippingle toilet will be approved. my understanding is that

jcdecaux doesn't want to do different toilet structures for historic and other locations. >> correct. we'll come back for certificate of appropriateness for the locations in landmark districts and then individual landmarks. that's coit tower, washington square park. and then come back as a permit to alter for the conversation districts, but one hearing tentatively scheduled for august 15. >> commissioner wolfram: great. that's soon. a lot of work it do. are there any other comments from any of the commissioners? >> chairman stryker: i would like to say to everyone how important it is and how grateful i am that we're meeting together. i think it's helpful to us to learn from each other and to hear each other's comments and what our concerns are and i think that's very useful not only for us, but for the public

and certainly for the designers and helping them expedite their projects, which is always thankful for that and look forward to doing it again. >> commissioner wolfram: and with all the work planned for the civic center, we'll be doing that. [laughter] yes, i want to thank the arts commission members for being here as well. i think it's a really great process for us to be here at the same time, not batting teams back and forth, but being able to have consensus here as well. with that, the hearing is adjourned. not quite adjourned. >> to summarize, in regards to relationship with the surroundings, we find the designs to be compatible due to the differentiation from the historic districts.

there way-finding, keeping in mind that it doesn't take away from the sculptural of the structures. you encourage the project sponsor to work a little further on a rounded form, whether it's the pronounced form and the kiosk. you sway away from the vegetation on the roof, but would like the roof to be a treated surface because of visibility from other structures. in regards to the material and colors, you would like to see a material sample and like the project sponsor to keep in mind the reflective quality and the shininess of the materials. and then based on a timely response to the comments, i wanted to go over the project is tentatively scheduled it come

back august 15. you will hear for the certificate of appropriateness. the comments we provided to the arts commission. on august 20, the project will be presented to the civic design committee. and that's for phase 2 and phase 3. staff requests that any design review commit question and arts commission comments be forwarded to planning staff for informational purposes. >> one correction. full arts commission is not meeting in september. so the next meeting after august will be october 1. >> thank you. >> commissioner wolfram: everybody concur? >> i would say the green roof --

there's a mixed response. not quite half and half. >> thank you, commissioners. >> commissioner wolfram: with that, our hearing is adjourned.

. >> as a matter of -- could we push the pledge of allegiance until later, or as a matter of protocol, do we have to start with the pledge? [inaudible] >> okay. why don't we wait until we have everyone here, and then we'll do that. roll call. [roll call] >> clerk: we have a quorum. >> president stansbury: great. we're going to be going into closed session, but before we do that, we'll be going into public comment before closed session. but seeing no

>> president stansbury: why don't we call the meeting back to order. we are just coming out of closed session, and my apologies to the public for making you guys wait so long. it was a very long day. is there a motion not to disclose? [inaudible] >> president stansbury: there's a motion. is there a second? i will second it. >> for which issue? >> president stansbury: a motion not to disclose what was coming out of closed session. there's a motion and a second. seeing no -- what's that, robert? [inaudible] >> president stansbury: i'm sorry. oh, just take the vote. okay. can we take this item without objection, then? >> yes. >> president stansbury: great. item passes. now we're going back into -- why don't we start with the pledge of allegiance. everyone here, if you'd please rise and join us for the pledge of allegiance. [pledge of allegiance]

>> president stansbury: great. thank you so much. why don't we call general public comment. any members of the public that would like to address the commission under general public comment? seeing none, we will close general public comment. next item, please. >> clerk: item number 5 is an action item, approval of the minutes of june 13, 2018 meeting. >> president stansbury: okay. great. i think we can take those as submitted. we'll calltor public comment. are there any members of the public wishing to address the commission on the minutes? seeing none, we'll close public comment. there's a move -- there's a motion and there's a second. any discussion? great. can we take this item without objection? item passes. next item, please. >> clerk: item number 6, action item on the consent

calendar. >> president stansbury: great. why don't we open it up to public comment. are there any members of the public that would like to address the commission regarding the consent calendar? seeing none, we will close public comment. is there a motion? i'll make the motion. is there a second? >> second. >> president stansbury: there is a second. any discussion? seeing none, can we take this item without objection? [inaudible] >> president stansbury: great. item passes. why don't we go ahead and call -- we'll move right onto item number 7, please. >> clerk: item number 7, discussion item, the investment committee report. >> no action's taken at this committee meeting, but there's education on three subjects -- actually, two. actually, director franzel discussed his plan for an absolute return portfolio. the key points he tried to stress to us was the average wait for the various strategies

that we're planning to invest in, even though they are very wide ranges, but focusing on what the average wait might be helps understand exactly where -- how the money will be allocated. we talked about leverage, remember to explain. remember to focus in the net areas, the leverage that we'll be exposed to, which is significantly less than the actual long dollar amount. we did not discuss any other invetment strategies. part two, our new management director, mr. colins, very impressive, the document he showed to the board, in this part of the meeting. those of you who had not read it, i suggest you get it and keep it. you will start to appreciate how complicated the subject of e.s.g. is that we are going to try incorporate in all of our

investments, let alone have all our managers incorporate formally in their investment process. so you'll just start to see how broad the task is and how much detail work must be done to incorporate this new -- how do i use the word? process, and how we're going to incorporate this e.s.g. into all of our investing. one person from cambridge was there discussing her involvement as well. the key thing to walk we away with during the presentations, we may have voted to do something, we are now starting to see how much work will be involved and how difficulty tricky assist -- it is in chiefing expects rate of return and still doing it with real good social, governmental and environmental policies. it's looking at the difficulty and how it may affect our rate of return. so that's what the committee was all about -- committee

meeting. >> president stansbury: thank you for the report. we'll open it up for public comment. are there any members of the public that would like to address the commission regarding this item? seeing none, we'll close public comment. any discussion or question from the board? great. thank you, commissioner driscoll. why don't we move onto item number 8. >> clerk: item number 8, action item, recommendation to commit up to $300 million to cartica's emergency fund. >> great. thank you. cart and others have -- cart and others have provided the board with some additional data and analysises as well as other data. this strategy is also led and formed by two women, and they're recently joined by a

third woman who's recently joined as their coc.i.o. so kurt, thank you very much for the additional material. >> you're welcome. you'll recall at the april 11th abort immediating. investment -- board meeting, investment recommended 300 million to the cartica investment tremendous gee. cartica was the result of an investment strategy that's announced about a year ago. however when we presented cartica to the board, the board expressed several concerns primarily based on their results -- historical results and some concern in growth and assets. in addition, they questioned the firm's relationship with calpers, and the sizing of cartica with fers portfolio. staff feels that cartica is a great solution for us, a great

fit, and we weren't successful in getting you guys to see the same thing was a failure on our part. so today, we want to address the board's concerns, and time permitting, we want to go through an example of a security, one of their top positions. following the meeting, we did have andrew write a separate report which is included in the material where he assesses cartica's e.s.g. practices in both the way they've managed their firm and the way they've managed their assets. what we'll do is a little bit more of a visual presentation as opposed to what we historically do in a memo driven way. but before we get into this, i want to remind the board of a couple of attributes we got into in our april meeting. first, we look for managers that have a differentiated, innovative, investment process that we think is sustainable over time. we look for managers that have strong business platforms

marked by long-term institutional investors like sfers, firms that focus on one strategy, not multidisciplines. we look for certain shared values or alignments with their investors. we don't want to own every security, otherwise we'll look like an index. we look for concentrated portfolios, and if we can find firms that have these attributes, we then look at the historical returns that we want them to be correlated or have low correlation with the other indices. that's exactly what we found with cartica. with that said, i'll give you a brief overview or background of cartica. it was a a washington d.c.

invest 789 firm founded in 2008 by former employees of the w.s.c., which aa branch of the world bank. the firm employs 35 people today and manages $3.1 billion for a select group of institutional investors including some prominent california based institutions, calpers, calstrs among them. they combine top down country selection and bottom up security selection. cartica is an activist manager, not a saber rattling that we may see on the front page among certain firms. they engage with companies to help them improve their businesses in terms of reporting, capital market structure, and more specifically governance practices. they tend to be a top shareholder in every company that they own.

this is important as we go through this. they typically own four to 7% of any one firm's outstanding shares so that they can get the firm's attention, you have to own a big portion of that company. so within our portfolio -- so a couple things, this was an r.f.p. what we were trying to do was see if we could upgrade the capablities of our emerging market managers. if approved, we're not going to add exposure to emerging markets, they will be funded by some of our existing managers. that said, we have a diverse identified group of emerging markets managers, but we also have three dedicated china managers, and this is why cartica's so important to sfers. because of our concentration among -- of china managers, over 50% of our emerging market exposure today is in china.

cartica's highest exposure is in india, brazil, and mexico. cartica's focused at the moment on industrial and consumer discretionary stocks, so by sector, by country, they're complementary to our portfolio. let's focus on their performance. there's a lot of data shown on page 12 of our memo. and here we just compared cartica's results relative to all the others that we have in the diversified emerging market space. i'm not going to go through all of these numbers, i'm just going to have you focus on the charts on the far right where we plot cartica's peers and their returns, and we show them

in two time frames, since cartica's inception, and down below we removed their first year. you'll recall they were up 89% of the first year. so we're moving it. what is telling about cartica's performance is regardless of period, they have produced higher risk-adjusted returns. page 13, we consider cartica relative to the others in our portfolio on a variety of measures, and this is important. they have the highest tracking error relative to their index. that's what we show on top. they have the lowest correlation relative to the indexes, which is important. and on the far bottom right, we show their correlation relative to all the other managers in our portfolio. cartica has the lowest correlation relative to their peers and relative to the indices. they're an important piece of our portfolio construction.

addressing the board's concerns about cartica's performance relative to their index, they're quite different relative to their index. cartica tends to focus on small and midcap companies. 75% of their portfolio is invested in such companies, while 80% of their benchmark are in large cap companies. the notice, cartica has not invested as much if any in i.t. companies, yes 30% of our benchmark is in -- yet 30% of our benchmark is in i.t. companies. as i noted before, this is true relative to the index, cartica has not invested at the moment in china. china has been, at least up until recently, one of the best performing e.m. indexes, e.m. markets. they haven't invested in south korea, which represents 16% of

the index. and it's not because there aren't good investment opportunities. remember cartica is an active investor, and the ability to apply activism or the ability to apply engagement with management in china or korea has been limited. cartica is starting to do some things here, but their exposure's relative to their benchmarks are quite different. small cap companies, no i.t., no china. i think we made these points pretty well to the board last time, so you asked that how have they done, how has their security selection been in the various countries that they invest? . what we show, this is a little bit of a complicated chart, the gray bars here show the expected return, cartica's expected return in each of the countries, and that's simply cartica's weight multiplied by the term of the benchmark. in the blue however it's cartica's actual results in

those companies. cartica's selection, if you will, across these seven markets is about 14.5% -- has added 14.5% percountry. questions about india specifically, which we show at the bottom of this page, and on page 18, in all times frames, cartica's got stock percentage in india, cartica's added significant value, over 8% annually since their inception. and you asked these questions, whether their historical selections have been disbursed. here we show the short drivers over the last several years, there's not one particular driver year over year that has driven their returns. the returns have been over each calendar year. which leads us then to how they perform relative to the

indices. what we did is we compared their results, again, the same time periods against the mcsi, emerging markets benchmark, but we also compared them to an mcsi benchmark without china, we chaired them to an mcsi without technology, we compared them to an msci, small and midindex. against all of them, cartica has superioror adjusted risk returns. >> say that again. >> what we didn't do them was show them against a variety of emerging market indexes. what we did here, and we've done on subsequent pages is we compared the results against that index, but we also included several others, the msci emerging market, ex-china,

msci emerging markets ex-i.t., msci emerging markets, small mid-cap. >> are there any other indexes that represent the emerging markets small mid-cap space? >> no. what cartica does is very special. it's concentrated, etcetera, small and mid-cap focus. there isn't a perfect proxy of what they do. but the point of this is to give them their fair shake and have you gain some perspective of what their performance looks like against a more comparable index. and against all of these indices, they produced higher risk adjusted returns. >> how we compared in those markets where we don't have an emerging markets exposure, have we looked at some -- maybe what some of our other managers are doing as a basis of comparison? >> most of our managers in the

e.m. space look a lot like the index, and that's part of what we're seeking to achieve by getting differentiated exposure. we won't go through the list of the names, but they tend to have benchmark like exposures in terms of market coop, in terms of countries, in terms of -- cap, in terms of countries, in terms of sectors. >> i don't mean to hold you up, but did we see -- i think willington was one -- we will wellington was one of the names on the chart. did you provide anything that we can see what they're doing in the same markets? >> we do. we didn't think it was important relative to the examination of cartica. cartica is different than what we're doing with wellington. wellington has a large and

midcap bias. cartica represents something very different. >> okay. thank you. if you'd like to keep going, please. >> wellington's exposures would be much more benchmark like, like country, company, active share, tracking error, etcetera. >> i've moved us to page 24, just in the interest of time. bottom right hand graph, and again, apologies for a lot of data here. what's important, again, here is this context, rolling three year periods, cartica has much lower correlation -- has low correlation relative to all of these indices. >> here on the lower right is cartica's correlation is very different than the market as a whole. they have much more stock specific risk rather than

market risk, and on the lower left, what we also like, is that cartica has meaningfully less volatility of returns than the benchmark as a whole. >> okay. i'm going to move us to page 25. i think we've demonstrated that cartica is different than the benchmark index. they provide substantial downside protection relative to the indices. their drawdowns, which are often losses from peaked trough tend to be less than that of the index, and their recovery from those drawdowns tends to be faster. and the hall mark of a good manager ultimately, and the way to compound good results over long periods of time is to lose less and recover faster. and these are the types of textured analysis that i don't think we -- we didn't provide

last time when we just look at three-year or five-year comparisons. so we talk about cartica, they manage a concentrated strategy, which we like, high, active share, unique process with high barriers to entry. there's an e.s.g. relative to what they do, and that's what staff sees in cartica. i'll pause here because we're going to go on and talk a little bit about their gross assets under managers, calpers, and i want to first address questions on their performance. >> commissioner driscoll. >> captain driscoll: i'm going to go to page 22 and page 23.

you had a couple months of performance were added from what we saw two months ago, correct? because you can see the inform 4.2 for the four months that would show sort of an uptick in the chart on the right on page 23. the point, though, i want to focus on -- [inaudible] >> absolutely. >> captain driscoll: which maybe that's why you added it this way. we figured it out last time it's not as compelling as a case looking at their since inception numbers, particularly since it was with $200 million. if their goal is to have 47% ownership in a -- 4 to 7% ownership in a company with $200 million, they weren't going to get very far, but

which is the better indicator of who they are? going back to 22, you've highlighted the three and five-year numbers. not a particularly compelling case. certain places in the footnotes indicate net numbers -- numbers, but i can't tell if they're net or gross numbers. >> they're net. >> captain driscoll: okay. we're going to pay over 1% plus a carry. to me, not wonderfully compelling. but to me, diverse identifying across managers to achieve what we want to do everywhere, actually, so i can see the case for that. but the certain things that are not very compelling, if you look at just -- when you look at just certain years, they didn't do very well. granted, we want longer holding period. would this type of manager be prepared to hold longer? do you happen to know what their average turnover is? >> yeah.

it's -- i believe it's 20% annual turnover. >> okay. it's a very high for hold. that contributes to less volatility or not, but believe it or not, that's part of their strategy, whether it shows up in the numbers or not. that's one of my observations as opposed to q&a. i'll come back to part two after you finish. >> the comments you made about three-year and five-year numbers are irrefutable. what's more important to us is how these guys look like over rolling periods, and again, what we're trying to seek is high incomes, low adjusted returns, but recall we're considering them in a portfolio context. >> not bad, just not really

good. let's move to -- >> you know what, maybe i'll just offer some comments real fast. you don't have to answer them. maybe you're going to touch base on them. i'm just curious about what happened in the first four months of 2018, right? you know, the welling numbers are interesting but not compelling. there's been a couple of blips in the six, seven, eight-year time frame, but we haven't seen a lot of replication of that. and then, i'm just trying to get a better understanding of who else is in these markets, india, mexico, fellowshphilippo else is doing well.

>> so the response to that question in particular is we just show how well they have done relative to the indices, not relative to the active managers in those markets. >> and that's one of my other questions, is there a good indice? you said you're going to compare the markets to a good indice? what's a good indice. >> over the long-term, it is a good idea. when you have a manager that looks so different, that's what we're seeking are managers that look different than the index. >> okay. >> 99% active share here. >> please continue, unless any

other board members -- >> when you put all the managers here with their different specialties, then you aggregate those and put them together and see if they beat the index. but that was the plan, right? >> this specific manager fits well in our portfolio. >> yes. >> that's the distinguishing -- if we're going to pick this manager, that that's the aspect you like the most? >> well, that's one. but their experience is pretty special, too. >> mm-hmm. yeah. >> yeah. >> the investment process and experience of these -- this group makes them compelling. >> mm-hmm. >> the fact that it fits well and it's complementary makes it more -- makes it intriguing, but if it weren't for the

differentiated process, the collective process with the i.f.c., we wouldn't have been interested. >> and so what we're trying to figure out is can we see that in the results? i think that this -- that's our job right now, is can we see that. >> right. >> and is there anybody else -- because i think what you're saying is there's nobody else who fits in -- i mean, the process is only as good as your results long-term, right? >> and we should -- maybe this is a place for us to talk about that process. this was an r.f.p. that we've issued may of 2017, when we were seeking managers in emerging markets, global, and developed international. dan has some of the statistics, but my recollection is it's something like 130, 125 responses? >> yeah. we started by evaluating on the order of i think it was 136 different strategies, but we drastically determined that only 36 of them qualified for

what we were looking for. and again, we were specifically looking for managers that were very different than the current managers that were concentrated, high tracking error managers. and so we focused on those 36. we came to you with a list of 30 semi finalists that we then had phone conversations with and trips and in-place meetings, both san francisco staff as well as nepc. >> and those five are still the lists. >> of the 30 semi finalists, these are the ones we're bringing forward. >> it looks like b.f.a. >> b.f.a. didn't qualify for the very concentrated, very high tracking error. >> we're trying to complement -- >> yeah. there's several others of those