Raleigh

At last glance, State Treasurer Janet Cowell was still on Facebook.

It would be understandable if she were not.

The social media giant and its recent initial public offering have caused a bit of a head-ache for the state treasurer.

One of the investment firms that Cowell and her staff used to invest a sliver of state pension fund dollars, Sands Capital Management, decided to play the Facebook IPO game. The results didn't pan out very well.

The pension fund lost $4.1 million on its $26 million investment.

To put those numbers in perspective, the $26 million investment represents not even one-tenth of 1 percent of the $75 billion state pension fund.

Nonetheless, revelations that the state pension fund and one of its outside managers had put any money into a risky and troubled IPO led to a fit of outrage from some retirees. Isn't this the kind of herdlike investment that a mature investor managing money for pensioners ought to avoid?

In response, the treasurer's office pointed to figures showing that the Sands Capital fund had gained 3 percent last year and 31 percent over the past three years.

The fund is a "large-cap growth" fund, meaning that it looks for high-risk, high-reward types of investments in larger companies. Theoretically, that investment ought to be offset by less risky investments within the pension fund portfolio.

While state retirees may have been irritated by the investment, they may have skipped over how all of this came to be fodder for a public chewing in the first place.

If so, they may have missed a more important point.

The investment became public knowledge because Cowell and her staff decided to join a class-action lawsuit over the losses and seek lead-plaintiff status. (As such, the pension fund could stand to recover the most money.) Another plaintiff and its lawyers argued that Cowell and the North Carolina pension fund shouldn't enjoy lead-plaintiff status, alleging a conflict of interest.

To her credit, Cowell has replaced a clunky state treasurer's website with one more easily navigated. The department's annual investment reports list all outside managers, and how much of those billions that each is overseeing. A quarterly report shows investment returns in each investment category.

It's not enough, though.

The California pension system broadcasts its investment committee meetings over the Internet.

The reason that this kind of transparency is needed is simple: Over the years, there have surely been some investments just as questionable as the Facebook IPO; the people to whom that money belongs ought to be able to find out when that occurs.

Scott Mooneyham writes for Capitol Press Association in Raleigh. Contact him at smooneyh @ncinsider.com.