Contributions by employers and employees are invested by VRS in order to generate additional revenue to fund the cost of current and future retirement benefits. Moreover, the majority of a retiree's lifetime benefit will be funded through earnings generated by the VRS investment program. Finally, strong investment earnings enable the Board to keep employer contribution rates stable as well as improve VRS' overall funding status. Therefore, the investment program is a vital component of VRS' ongoing operations.

As discussed in the Administration section, the VRS Board of Trustees (the Board) is required by the Code of Virginia (§51.1-124.30) to invest the assets of the retirement system in accordance with the prudent person standard. In order to assist the Board in fulfilling this responsibility, the Code requires that an Investment Advisory Committee (IAC) be established. The Chief Investment Officer (CIO) directs and manages the investment department at VRS. The CIO and professional investment staff operate and monitor the investment program on a day-to-day basis in conformance with policies and guidelines established by the Board. The CIO and staff also receive advice and feedback from the IAC.