A key to Jeff Lewis’ success as the retirement program chief at FedEx is that he knows the value of keeping things compact and comprehensible. FedEx invests in fewer assets than its peers, has several long-term relationships with asset managers that have flexible mandates, and strives to keep “the investment portfolio as straightforward and understandable as possible,” he explained. Another boon is that Lewis has strong and engaged governance: an investment committee whose members have long tenure and give him leeway.

When he took over, holdings were $12 billion—and now they have grown to over $30 billion. Through October, the FedEx fund is up 5.5% for the year, with the fixed-income portfolio down modestly and return-seeking assets up strongly. This comes after an 18.5% return in 2020. The fund weathered early 2020 in fine shape. “We did not have a hole to dig out of,” he said. At the market bottom last year, the plan had spare cash to invest in bargain equities.

Lewis credits the success to “the balanced investment strategy we’ve designed over the years.”

Travel restrictions didn’t stop the FedEx program from adding fresh talent: Lewis brought aboard seven new managers to enhance his base of 40. “Throughout the last two years, the team didn’t miss a beat and stayed very engaged,” he explained.

Helping was his decision to shed some liabilities. In 2018, FedEx did a $6 billion pension risk transfer, which he said was the third largest on record. “Unusually, we perform an asset-liability study every year to fully understand the key risks in our portfolio,” he added.

One FedEx innovation he engineered was to seed a private credit fund, which allows FedEx to keep more of its capital working. He said he tired of having to re-up with managers and at times leave some of the fund’s capital undeployed. At the same time, he set up two structures: one to handle various alternative investments such as real estate and infrastructure, and another for private equity. <<<<RIGHT? He also implemented a state-of-the-art in-house risk management system.

Lewis has certain methods of operation that have served him well: read everything, stay curious, hire good staffers unafraid to challenge him, and “act as an analyst and do the grunt work.” The goal is to execute well and on time, he said, all the while knowing “what you are good at and what you aren’t.”

With a bachelor’s degree in history and economics from Dartmouth and an MBA from the University of North Carolina, Lewis had a number of finance jobs, at Cazenove (now part of JPMorgan), Bolton Investment Group, and Goldman Sachs before he joined FedEx.

He realized that he was best suited an investment analysis, rather than salesmanship. He signed on with FedEx as an adviser in 2006, rose to staff director in 2009, and then took his current position in 2018.

“I enjoy dealing with deal complexity and strategy,” he said. “What I do is not magic.” But the canny operation he runs seems as if it is.

—Larry Light