# Westrock Procedural Asymmetry In May and June 2025, Mark White made two contemporaneous statements about how ATRS makes investment decisions. The two statements describe two procedural standards. One applies to the Westrock Coffee position ATRS already held; the other applies to the Israel Bonds position ATRS was about to acquire. The standards differ on the most basic procedural question: whether outside investment consultants make written recommendations to the Board. This is not the same evidentiary point as [[independent-credit-analysis-gap]]. The independent-credit-analysis-gap concept describes the absence of analysis on Israel Bonds. The present concept describes the presence of a more rigorous standard applied by the same person at almost the same time to a different investment, demonstrating that ATRS knows how to do consultant-recommendation-driven investment governance and chose not to apply that standard to Israel Bonds. ## The Westrock standard (5/20/2025) ATRS retiree John Rollans pressed White on 5/19/2025 about ATRS's 2.5 million shares of Westrock Coffee, citing four years of Westrock losses totaling approximately $200 million and asking how ATRS would divest. White's 5/20/2025 reply, captured in the production at Communication with John Rollans - 9 june 2025.pdf p.2, describes the procedure that governs the Westrock holding: > [!evidence] White to Rollans, Communication with John Rollans - 9 june 2025.pdf p.2, 5/20/2025 > "At ATRS our investment decisions are based on recommendations from our outside professional investment consultants. They are monitoring and stay in regular communication with Westrock, and if they determine it is in the System's interest to sell our stake, they will make that recommendation to the Board." White also cited external validation from third-party analysts independent of ATRS: > [!evidence] White to Rollans, Communication with John Rollans - 9 june 2025.pdf p.2, 5/20/2025 > "I'd add that there are 5 analysts on Wall Street who are tracking and making recommendations on Westrock, and all 5 of them have the stock rated as 'buy', meaning they are recommending that their clients purchase Westrock stock. I say that only to illustrate that the optimistic view of Westrock's future is not just our consultants, that optimistic view is shared by other professional analysts who have no connection to ATRS." The Westrock framing thus has three procedural elements: (1) ATRS investment decisions are consultant-recommendation-driven; (2) consultants monitor and recommend buy/sell to the Board; (3) external analyst consensus provides independent validation. ## The Israel Bonds standard (5/8/2025) Twelve days before the Westrock reply, White directed Rod Graves to prepare the Israel Bonds proposal for the June Board meeting. The 5/8/2025 directive (captured in the ATRS Staff Emails batch at Emails3.pdf p.6) describes a different procedure: > [!evidence] White to Graves, Emails3.pdf p.6, 5/8/2025 > "Let's go ahead and plan to move forward with a proposal to the Board in June. Please talk with Aon and/or State Street to see what they can present to the Board. I know they will not be making a formal recommendation, but I would like to have some information from them as to the characteristics, performance, and risk profile of these bonds, and to the extent they will do so, some assurance that this is a worthwhile investment." The Israel Bonds framing has different procedural elements: (1) Aon, the investment consultant, "will not be making a formal recommendation"; (2) the executive director writes the recommendation memo for the Board packet himself; (3) no external analyst validation is cited or sought. ## The asymmetry Same executive director. Same investment-decision frame ("our investment decisions"). Two procedural standards. For Westrock (a held position): consultants recommend to the Board; external analysts provide independent validation; the executive director defers to that process. For Israel Bonds (a new acquisition): consultants explicitly do not recommend; the executive director writes the recommendation himself; no external analyst validation is documented. The asymmetry is not that ATRS lacks procedures for consultant-recommendation-driven decision-making. ATRS clearly has those procedures, and White invokes them when defending Westrock to a member who proposes divesting. The asymmetry is that those procedures were not used for Israel Bonds. White's own description of how ATRS investment decisions get made, given to a member outside the institution, does not match what he asked his investment officer to set up for the Israel Bonds proposal. The procedural standard White described to Rollans is also closer to the standard required by ATRS's own Investment Policy. Board Policy 4 Section A.5 requires "written advice or a written recommendation from a third-party investment consultant" for material direct investment changes. The Westrock framing ("consultants make recommendations to the Board") conforms to this requirement. The Israel Bonds framing ("they will not be making a formal recommendation") sits in tension with it. See [[written-recommendation-requirement]] for the policy provision. ## The April 7 procedural baseline The 7/3/25 supplemental ATRS FOIA production sharpens the asymmetry from a Westrock-vs-Israel-Bonds comparison to a routine-Board-practice-vs-Israel-Bonds comparison. The April 7, 2025 Board meeting (the meeting immediately preceding the June 2, 2025 Israel Bonds vote) approved seven major manager commitments totaling approximately $463 million plus 40 million euros, every one of which cited an Aon Hewitt or Franklin Park consultant recommendation in the resolution preamble or executive summary: | Resolution | Investment | Amount | Recommendation Source | |---|---|---|---| | 2025-14 | Ares Industrial Real Estate Fund, LP | up to $100M | Aon Hewitt; ATRS staff concurs | | 2025-15 | Carlyle Property Investors, LP | up to $100M | Aon Hewitt; ATRS staff concurs | | 2025-16 | AxInfra NA II, LP (supplemental) | up to $50M | Aon Hewitt | | 2025-17 | KKR Diversified Core Infrastructure Fund, LP (supplemental) | up to $50M | Aon Hewitt | | 2025-18 | MML Capital Partnership VIII, SCSp (Imminent Need) | up to 40M EUR | Franklin Park | | 2025-19 | Franklin Park Venture Capital Fund XV, L.P. (Imminent Need) | up to $40M | Franklin Park | | 2025-20 | Franklin Park Venture Capital Opportunity Fund II, L.P. (Imminent Need) | up to $40M | Franklin Park | All seven April 7 resolutions passed unanimously. The same investment consultant (Aon Hewitt, with PJ Kelly and Katie Comstock leading) that ATRS retained at the June 2 meeting for the Israel Bonds proposal advised the Board at the April 7 meeting on four of these seven decisions. The other three were advised by Franklin Park as private equity consultant. The procedural pattern at April 7 is the standard ATRS manager-selection procedure: a consultant recommendation, an Investment Committee recommendation, a Board vote. At the June 2 meeting, the Board considered three major manager commitments: Resolution 2025-22 (Israel Bonds via Reams, up to $50M), Resolution 2025-23 (Arlington Capital Partners VII, up to $40M), and Resolution 2025-24 (Great Hill Equity Partners IX, up to $40M). Resolutions 2025-23 and 2025-24 are presented in the 6/2 packet with substantive Franklin Park investment recommendation memos describing the funds, the firms' histories, the principal investors, the investment thesis, and the consultant's recommendation. Resolution 2025-22 is presented with the Kelly + Comstock memo described at [[atrs-resolution-2025-22]]: two pages containing only a header and an empty appendix heading. See also [[independent-credit-analysis-gap]]. The procedural asymmetry is therefore documented at three nested levels. At the level of contemporaneous-statement comparison (the original framing of this concept page): White's Westrock framing on 5/20/2025 ("our investment decisions are based on recommendations from our outside professional investment consultants") versus White's Israel Bonds framing on 5/8/2025 ("they will not be making a formal recommendation"). Twelve days apart, same author, two procedural standards. At the level of meeting-pair comparison: the April 7 meeting (seven manager decisions, all with substantive consultant recommendations attached) versus the June 2 meeting (three manager decisions, two with substantive recommendations and one with the header-only Kelly + Comstock memo). Eight weeks apart, same Board, same consultants, two procedural standards. At the level of within-meeting comparison: the June 2 meeting itself contains the within-meeting asymmetry. Resolutions 2025-23 and 2025-24 have substantive Franklin Park recommendation memos attached. Resolution 2025-22 has the Kelly + Comstock memo of pp.149-150. Same Board, same meeting, same consultant infrastructure, two procedural standards applied to different agenda items in the same packet. ## Why the asymmetry matters A defense of the Israel Bonds procedure that says "Aon doesn't make formal recommendations on this kind of investment" or "consultant recommendations are advisory, not required" is undercut by the contemporaneous Westrock framing, in which White himself tells a pension member that ATRS investment decisions are consultant-recommendation-driven. Either the procedural standard White described to Rollans is the actual ATRS standard (in which case the Israel Bonds procedure deviated from it), or the procedural standard White described to Rollans is rhetorical reassurance to a concerned member (in which case it is materially misleading to a person to whom White owes a fiduciary duty). The asymmetry also bears on the question of whether the BP4 Section A.5 requirement was satisfied for the Israel Bonds action. If the Israel Bonds procedure is substantively identical to the procedure described to Rollans for Westrock, then either both satisfy Section A.5 or neither does. If the procedures differ as the documents indicate, then the Section A.5 question is sharper for Israel Bonds than for Westrock. ## Westrock context This concept page does not address the merits of the Westrock investment itself. ATRS owns 2.5 million Westrock Coffee shares per White's 5/19/2025 reply to Rollans. Per the same reply, Westrock reported a Q1 2025 gross profit of $29.1 million and a net loss of $27.2 million. Rollans's 5/19 follow-up cited approximately $200 million in cumulative Westrock losses across 3-4 years. Whether the consultant-recommendation procedure White described actually produced the Westrock holding decision, or whether the Westrock holding pre-dates the procedural framework, is not established by the materials in this batch. The Westrock evidence here is procedural-comparison evidence, not investment-merit evidence. ## What this batch does not establish Whether Aon ultimately did produce a written recommendation for the Israel Bonds action is not in this batch. The BoardDocuments PDF transmitted to Jennifer Lenow on 6/4/2025 is the most likely location for any such document. The companion concept pages [[written-recommendation-requirement]] and [[independent-credit-analysis-gap]] track this open question. Whether White's framing of ATRS investment decisions as consultant-recommendation-driven was the historical norm or the current state at the time of the Westrock reply is not established by this batch. The standard described to Rollans appears in a single defensive context. ## Evidence > "At ATRS our investment decisions are based on recommendations from our outside professional investment consultants. They are monitoring and stay in regular communication with Westrock, and if they determine it is in the System's interest to sell our stake, they will make that recommendation to the Board." > Mark White to John Rollans, Communication with John Rollans - 9 june 2025.pdf p.2, 5/20/2025 > "I'd add that there are 5 analysts on Wall Street who are tracking and making recommendations on Westrock, and all 5 of them have the stock rated as 'buy', meaning they are recommending that their clients purchase Westrock stock. I say that only to illustrate that the optimistic view of Westrock's future is not just our consultants, that optimistic view is shared by other professional analysts who have no connection to ATRS." > Mark White to John Rollans, Communication with John Rollans - 9 june 2025.pdf p.2, 5/20/2025 > "Let's go ahead and plan to move forward with a proposal to the Board in June. Please talk with Aon and/or State Street to see what they can present to the Board. I know they will not be making a formal recommendation, but I would like to have some information from them as to the characteristics, performance, and risk profile of these bonds, and to the extent they will do so, some assurance that this is a worthwhile investment." > Mark White to Rod Graves, Emails3.pdf p.6, 5/8/2025 > "I will do a memo for the packet that outlines our recommendation, and then we can attach whatever the consultants/managers provide, and also see what information the underwriter can give us to provide the Board." > Mark White to Rod Graves, Emails3.pdf p.6, 5/8/2025 ## Cross-References [[mark-white]] author of both contemporaneous statements [[john-rollans]] retiree whose Westrock dissent prompted the procedural disclosure [[independent-credit-analysis-gap]] companion concept page on the substantive analysis absence [[written-recommendation-requirement]] companion concept page on the BP4 Section A.5 procedural requirement [[atrs-investment-policy-bp4]] concept page on Board Policy 4 [[atrs-resolution-2025-22]] concept page on the action whose procedure is at issue [[atrs-foia-r1-staff-emails]] [[auditor-foia-r1-milligan]] [[atrs-bot-packets-7-3-25]] [[apers-foia-r1-7-7-25]] source pages ## APERS-side parallel: Borromeo's IFSC agenda framing (7/7/25 production) The 7/7/25 APERS R1 production documents an APERS-side parallel of the Westrock-Israel Bonds procedural asymmetry. Carlos Borromeo's 5/8/2025 IFSC agenda email to Amy Fecher contemporaneously framed the Israel Bonds presentation as Brady alone, distinct from the Private Credit and Secondary Infrastructure presentations the same IFSC was holding at the same meeting. Borromeo's parenthetical justification for bringing Stephens, HarbourVest, and Neuberger Berman to the Private Credit discussion: "I didn't feel that we had the 'ok' to go ahead with P/C, so we are bringing in the firms with the knowledge." The asymmetry within the APERS instance: Secondary Infrastructure had three competing managers under Callan's procured-search analytical framework (32 pages of consultant analysis), Private Credit had firms "with the knowledge" presenting (26 pages of firm-level analytical material from Stephens, HarbourVest, and Neuberger Berman), and Israel Bonds had Brady alone presenting (zero pages of analytical material from any source). The same IFSC, the same packet, the same meeting. Borromeo as APERS CIO is therefore documented in contemporaneous writing acknowledging the analytical-attention asymmetry at the moment he set the agenda. Borromeo's same-day 5/14/2025 12:24 PM "Bo I will need your fixed income eyes please" email to Stephens (Bo Brister) is the APERS analog to Mark White's "they will not be making a formal recommendation" framing for ATRS Aon. Both frame the day-before-the-vote outside-firm consultation as informal-and-quick rather than substantive-and-recommended. Both produced no documented analytical product before the authorization vote. The combined evidence at both pension systems — Mark White at ATRS framing Aon as not making a "formal recommendation" while contemporaneously framing ATRS investment decisions to a member as consultant-recommendation-driven; Carlos Borromeo at APERS framing Israel Bonds as Brady-presenter-only while contemporaneously bringing Stephens/HarbourVest/Neuberger Berman as "firms with the knowledge" for Private Credit — establishes the procedural asymmetry as a multi-system pattern. Both pension systems' CIOs/EDs documentarily knew how to procure substantial firm-level analytical attention for non-Israel-Bonds investments and did not procure it for Israel Bonds. ## Auditor R3 3-3-26 production: Mark White's 7/2/2025 post-vote process defense to Lenow The Auditor R3 production at [[auditor-foia-r3-3-3-26]] captures Mark White's 7/2/2025 4:44 PM substantive response to Jennifer Lenow's Arkansas Times inquiry — White's most extensive post-vote articulation of the procedural framing. White's process defense: > *"Last month, the Board selected an investment manager to increase our stake in investment strategies that include bonds issued by the Government of Israel. The Board made this decision with the advice of its general investment consultant and their recommendation of an investment manager. This process — the selection of an investment manager based upon the advice and recommendation of our general investment consultant — is the same way the Board always chooses fixed income investment managers. This is what the Board's policies require."* > > *"Even though this request started with a Trustee, we still followed our usual process. Nothing prohibits a Trustee from suggesting an investment. What state law requires for ATRS (but not for other systems like APERS) is for our Board to seek the 'advice' of its consultant before making an investment decision. That's exactly what the Board did in this case."* > > *"The Board's decision was based on the materials that staff presented to them. This included the consultant's advice on an investment manager, as well as proposed fees and sample rates and terms. These are all pecuniary factors under Arkansas law."* White's response defends the procedural-asymmetry framing as follows: the ATRS process for the Israel Bonds investment was investment-manager-selection-driven (Reams) on consultant advice (Aon Hewitt), not direct-investment-decision-driven. The same procedural pathway applies to Westrock and other manager-selection decisions. The substantive analytical question Lenow surfaced — whether the consultant's "caveat... about not recommending a purchase" diminishes the consultant-recommendation argument — White rejects with a narrowing of the consultant's stated role: > *"You mention the caveat in the consultant's memo about not recommending a purchase, but this is no different from any of their other recommendations. It is not unique to this investment decision. Our general investment consultant's role is to review and make recommendations about investment managers. They never make recommendations about the purchase of individual stocks or bonds. That is not their job, and they would be exceeding the scope of their securities licensure if they were to do so."* The "exceeding the scope of their securities licensure" framing redefines the consultant role narrowly post-hoc: Aon Hewitt's role is manager selection only, not specific instrument purchase recommendation. The framing is consistent with [[written-recommendation-requirement]] in [[atrs-investment-policy-bp4]] Section A.5 (which requires "written recommendation from the investment consultant" but says nothing about purchase-of-individual-instrument recommendations) and is the most thorough post-vote White-side articulation of the procedural pathway. The substantive critique the asymmetry preserves: White's contemporaneous 5/20/2025 framing of the Westrock investment to Rollans cited *"5 analysts on Wall Street who are tracking and making recommendations on Westrock, and all 5 of them have the stock rated as 'buy'"* — independent Wall Street analyst validation, plural and named-rating. The Israel Bonds investment had no documented equivalent independent analyst validation in the 6/2 Board packet (the empty Kelly + Comstock memo) or in White's 7/2 response. White's 7/2 framing re-defines the consultant role as not-individual-instrument; the Westrock framing centered individual-instrument-level analyst validation. The asymmetry holds. ## Tensions This concept page's analytical question is the asymmetry itself; the contested mechanism is filed as a tension page per the Hegelion layer. - [[T003 - Westrock-vs-Israel-Bonds Procedural Standard]] — Same author, same investment-decision frame, twelve-day window, two procedural standards. Statement A: role-appropriate consultant engagement across differently-shaped decisions; the procedural standard is single and consistent under the licensure-scope framing. Statement B: ATRS applies inconsistent procedural standards; the licensure-scope rationalization is post-hoc reconstruction. *Attribution tension. Status: open.*