There were many high-quality submissions for this year’s Industry Innovation Awards, which recognize outstanding leaders and innovators in the field of investments. CIO found a deserving recipient in Elizabeth Tulach, who was celebrated as CIO of the Year during the 2023 Asset Owner Innovation Awards Gala in New York on December 5. Tulach also won in the CIO category for corporate defined benefit plans greater than $20 billion.
Tulach, widely known as Liz, has spent much of her career at the Boeing Co., having joined in 2005 as a managing director of alternatives for the defined benefit plan. She became deputy CIO in 2019, moving up to vice president and CIO in 2021.
When Tulach was promoted to the captain’s chair, she recognized the company in general was facing issues that would have negative headwinds on the pension. The company was emerging weaker from the COVID-19 pandemic, when air travel declined significantly, and supply chains were disrupted. These challenges led to a drain of cash and ballooning debt, with little room for contribution to the company’s pension plan.
Tulach, based out of Chicago, and her team recognized it had to find a way to generate enough liquidity to meet its pension benefit payments, which total $4 billion annually, with significant additional sums owed in lump sum payments. The fund recognized there would be no assistance in the form of cash contributions from its plan sponsor, with a recovery that would be prolonged over years.
To solve this, the fund held liquidity meetings on a weekly basis to discuss potential actions. The fund developed a plan to refine its glide path to realign closer to its exposures, allowing the fund to expand its asset class exposure for more flexibility in implementing its strategic plan.
Each of the fund’s asset class teams developed implementation plans according to the fund’s liquidity needs. Within Boeings fixed-income holdings, the fund realigned its mandates to be 100% credit and consolidated its Treasury portfolio to serve as collateral for its interest rate hedging portfolio, resulting in more efficient collateral support and management of the fund’s treasurys.
In 2021, the fund begun to hit funded status triggers, which allowed it to raise $15 billion from return-seeking assets.
During Tulach’s tenure, the funding status of Boeing’s pension master trust grew to 93%, as of September 30, from 85.8% in 2020. The company’s one-, five- and 10-year returns were 0.4%, 4.1% and 5.8%, respectively. The fund has $49.1 billion in assets, as of September 30.
The plan was also one of the first to utilize a total-fund analytics platform that allowed it to run a risk analysis during periods of heightened volatility and crises.
Tulach’s recognition as CIO of the Year is a testament to her skills, foresight and impactful contributions made to Boeing and her team, as they successfully navigated a difficult period for the company, delivering strong returns and increasing funded status despite numerous challenges, doing so in a way that incorporated new ways of thinking and innovative approaches to asset allocation.
Jason Klein, CIO of the Memorial Sloan Kettering Cancer Center and the 2022 CIO of the Year, said of Tulach as he passed the torch, that she is “admired for independent thinking, being an advocate for team members’ learning and development across professional and personal lines, and representing her team, sponsor and community with grace and generosity.”
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Tags: Asset Owner Innovation Awards, Boeing, CIO of the Year, Elizabeth Tulach, Jason Klein