BISMARCK, ND – The North Dakota State Investment Board (SIB) has selected Funston Advisory Services LLC (FAS) to conduct the first-ever comprehensive assessment of its governance model, the framework that defines how the board operates, makes decisions, and oversees the Retirement and Investment Office (RIO) to ensure accountability and resilience.
“Undertaking a governance review underscores the State Investment Board’s commitment to fiduciary excellence, transparency, and long-term operational success,” said Gov. Kelly Armstrong, SIB chair. “As our investment program grows in size and complexity, we are committed to managing it as efficiently and effectively as possible.”
FAS will evaluate the investment program’s governance framework to ensure it supports the SIB’s core goals. The review will focus on compliance with applicable laws, governance structure and oversight responsibilities, board culture, operational clarity, board–staff relations, risk oversight, and identifying opportunities for improved efficiency through streamlined documentation.
“Strong governance is foundational to managing public funds responsibly,” said Dr. Rob Lech, SIB vice chair and chair of the board’s Governance and Policy Review Committee. “The review will help clarify roles and responsibilities, enhance decision-making processes, strengthen our risk oversight, and ensure that the governance model we follow is not only effective today but is ready for the future.”
Guided by legal counsel, the SIB began developing a governance structure in 1995 to clarify fiduciary responsibilities within state law and trust principles. The board adopted a policy-based governance model known as the Carver Model that defined the roles and delegations between the SIB and RIO. At that time, the SIB oversaw $1 billion in assets. While the board’s foundational policies have been refined over the years, it has never undergone an independent governance assessment. The SIB now oversees more than $24 billion in assets, including the North Dakota Legacy Fund, Public Employees Retirement System, and Teachers’ Fund for Retirement. Its activities are administered by RIO.
“Acting now allows the State Investment Board to proactively shape its governance model while internal changes are being implemented, ensuring that any new structure is sustainable, strategic, and fully integrated,” said Jodi A. Smith, RIO executive director.
One recent program change is RIO’s launch of an Internal Investment Initiative in April, shifting the management of 15% of the SIB’s portfolio in-house. The initiative aims to strengthen oversight, reduce external management costs, and build internal investment capacity.
FAS is nationally recognized for advising public funds on governance, operations, and risk intelligence.