The Calpers CEO and the Controversy Over Her Education

In 2016, the California Public Employees’ Retirement System (Calpers) hired Marcie Frost, the former director of the Washington Department of Labor & Industries, as its new CEO. Since the time of her appointment, Calpers is about to have it third CFO and a series of top executives have left. Calpers has 77% of what it needs to provide for future retirement benefits.

In addition, what has emerged are questions about Ms. Frost’s educational background. When she was appointed, the press release said that she was pursuing a dual degree at Evergreen State College in Olympia. However, a blog contacted the college and she was not enrolled. Ms. Frost was confronted at a staff meeting about how she had presented he educational credentials.

Ms. Frost explained that she had been honest during the interview process and disclosed that she did not have a college degree. The search firm Heidrick & Struggles had prepared a document on her background and described her as being “currently matriculated in a dual degree program” at Evergreen. That document was used as the basis for the press release on her hiring.

In fairness to Ms. Frost, she has had an amazing 30-year career, including a successful tenure as director of the Washington fund, keeping funding at 86% and standing up to the governor on combining government benefit units. She was a teen mom who worked her way up through the ranks in state government and stands on those credentials.

However, the issue is candor. Saying you have a degree when you do not is a common hiring deception. Trying to de-emphasize the lack of a degree with current enrollment is a typical cover. Being confident enough in your work experience that the lack of a degree is overcome gives candidates the chance to explain the life story — and Ms. Frost has a compelling one.
Unfortunately, with Calpers’ hiring processes now under investigation and the taint of the press release, Ms. Frost is at the center of the resulting turmoil. And all because of the use of the words “enrolled” and “matriculated.” Being a public pension beneficiary, the Barometer prefers someone sans degree who is willing to reduce the assumed rate of return to 7% and aims for 86% funding as CEO. Enrollment at this point in a successful 30-year career is largely irrelevant — the problem is whether that point was made during her interviews and clear to the board members who hired her. That goes to Ms. Frost’s ethics and may be behind the struggle she faces with turnover and staff.

About mmjdiary

Professor Marianne Jennings is an emeritus professor of legal and ethical studies from the W.P. Carey School of Business at Arizona State University, retiring in 2011 after 35 years of teaching undergraduate and graduate courses in ethics and the legal environment of business. During her tenure at ASU, she served as director of the Joan and David Lincoln Center for Applied Ethics from 1995-1999. In 2006, she was appointed faculty director for the W.P. Carey Executive MBA Program. She has done consulting work for businesses and professional groups including AICPA, Boeing, Dial Corporation, Edward Jones, Mattel, Motorola, CFA Institute, Southern California Edison, the Institute of Internal Auditors, AIMR, DuPont, AES, Blue Cross Blue Shield, Motorola, Hy-Vee Foods, IBM, Bell Helicopter, Amgen, Raytheon, and VIAD. The sixth edition of her textbook, Case Studies in Business Ethics, was published in February 2011. The ninth edition of her textbook, Business: lts Legal, Ethical and Global Environment was published in January 2011. The 23rd edition of her book, Business Law: Principles and Cases, will be published in January 2013. The tenth edition of her book, Real Estate Law, will also be published in January 2013. Her book, A Business Tale: A Story of Ethics, Choices, Success, and a Very Large Rabbit, a fable about business ethics, was chosen by Library Journal in 2004 as its business book of the year. A Business Tale was also a finalist for two other literary awards for 2004. In 2000 her book on corporate governance was published by the New York Times MBA Pocket Series. Her book on long-term success, Building a Business Through Good Times and Bad: Lessons from Fifteen Companies, Each With a Century of Dividends, was published in October 2002 and has been used by Booz, Allen, Hamilton for its work on business longevity. Her latest book, The Seven Signs of Ethical Collapse was published by St. Martin’s Press in July 2006 and has been a finalist for two book awards. Her weekly columns are syndicated around the country, and her work has appeared in the Wall Street Journal, the Chicago Tribune, the New York Times, Washington Post, and the Reader's Digest. A collection of her essays, Nobody Fixes Real Carrot Sticks Anymore, first published in 1994 is still being published. She has been a commentator on business issues on All Things Considered for National Public Radio. She has served on four boards of directors, including Arizona Public Service (1987-2000), Zealous Capital Corporation, and the Center for Children with Chronic Illness and Disability at the University of Minnesota. She was appointed to the board of advisors for the Institute of Nuclear Power Operators in 2004 and served on the board of trustees for Think Arizona, a public policy think tank. She has appeared on CNBC, CBS This Morning, the Today Show, and CBS Evening News. In 2010 she was named one of the Top 100 Thought Leaders in Business Ethics by Trust Across America. Her books have been translated into four different languages. She received the British Emerald award for authoring one of their top 50 articles in management publications, chosen from over 15,000 articles. Personal: Married since 1976 to Terry H. Jennings, Maricopa County Attorney’s Office Deputy County Attorney; five children: Sarah, Sam, and John, and the late Claire and Hannah Jennings.
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