Organizational Changes, New Roles Created for Australian Future Fund

Changes made to simplify structure, focus on performance.

As it heads into its second decade, Australia’s A$138.9 billion ($107.8 billion) Future Fund sovereign wealth fund will be changing its organizational structure in terms of its investment team.

Dr. Raphael Arndt will stay on board as the Melbourne-based fund’s CIO, adding the investment duties of the chief investment strategist to his responsibilities as well as leading the asset class teams.  Stephen Gilmore, the current chief investment strategist, will aid in Arndt’s transition before his departure from the fund in late April.

The Future Fund will also seek to fill the newly created role of head of portfolio strategy.

Wendy Norris, the fund’s head of infrastructure and timberland, will become deputy CIO of the private equity markets, while David George, head of debt and alternatives, will become deputy CIO for public markets. Norris will oversee private equity, property, infrastructure, and timberland, while George will monitor listed equity, overlays, debt, and alternatives.

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The Future Fund has also created a chief technology officer position, which will be responsible for leading the IT area as well as investment solutions. The CTO will work with the investment team to “develop bespoke investment technology solutions to drive investment insights,” according to a news release. The fund will soon perform a global search process to fill the position.

In addition to his obligations as general counsel, Cameron Price will also become the fund’s chief risk officer.

According to a news release, the changes are “focused on simplifying the structure and reinforcing our focus on the performance of the portfolio as a whole.”

“Over the last decade, the Future Fund has exceeded its benchmark return and generated over $78bn in investment returns,” said CEO David Neal in a statement. “To sustain our success as our portfolio grows, we are refining our structure. This will strengthen our collaborative approach and help us to be more nimble and streamlined in the hunt for investment opportunities, the management of the investment portfolio, and the creation and use of technology and risk insights.

“Implementing these changes will help us stay sharply focused on our task of investing for the benefit of future generations of Australians,” Neal said.

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Diocese of La Crosse Cuts Pension Plan

More than 1,000 pensioners to lose benefits; Fund had been frozen since 2007.

A letter from Bishop William Patrick Callahan has informed members of the Wisconsin-based Diocese of La Crosse Lay Employees’ Retirement Plan that they will be losing their pension benefits.

“After much analysis, discussions and prayers, it has been determined that it is necessary to terminate the Diocese of La Crosse Lay Employees’ Retirement Plan at this time,” Callahan wrote in the Feb. 27 letter, received over the weekend by plan members.

The plan has been underfunded for years; the letter notes that it was frozen in 2007 and was replaced with a 403(b) retirement plan, leaving increases for members’ accrued benefits in the cold after Dec. 31, 2006.

More than 1,000 members will lose their benefits, and the full magnitude of the plan termination won’t be felt until late May, as reported by the Eau Claire Leader-Telegram, who broke the story.

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Catholic school teachers, custodians, secretaries, rectory workers, and other Diocese employees affected by the closing will see all lay funds distributed as a one-time, lump-sum payment based on the ratio of available assets divided by total liabilities. According to the letter, each eligible individual will be impacted differently by this payment method.

Until the final payment is made in the summer, monthly pension payments will continue.

“People are very, very apprehensive, to put it mildly,” retired Regis High School teacher Howard Campbell told the paper. “The main thing is the very tenuous uncertainty hanging over their heads. That’s the frightening thing for a lot of people.”

 

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