Cultivation or Theft?

To view this article in digital magazine format,click here.

Some view investment funds as well-oiled machines, their flywheels and pistons whirling and pumping at predetermined intervals like clockwork (well, depending on the year)—but, in a persistently volatile market, these systems can be shaken. Fundamentally, a fund is only as strong as those manning the wheel. It’s about the people. 

Today, as always, asset owners of all types are clambering for talent. This is true of both poorly performing and best-in-class funds, and thus it is no surprise that the five Canadian behemoths—Canada Pension Plan (CPPIB), Ontario Teachers’, Quebec’s Caisse, Alberta Investment Management (AIMCo), and Ontario Municipal Employees (OMERS)—are locked in what some would call a zero-sum competition for the Best and Brightest. If the money and brainpower north of the border is immense, so is the competition. 

So how do these funds find talent? 

At the most basic level, these funds tap into university, industry, and association networks, personal referrals, as well as relying on their brand power to attract top hires. Although most funds have internal recruiters, some engage external search firms for executive-level searches where a specific skillset is required, such as with Teachers’ recent hire of a certified business valuator. 

More and more, these funds are looking internally for homegrown minds. ‘’If you look at the bios of our executives, many have had substantial experience within our firm,” says Frédérick Charette, Executive Vice President, Talent Management and Organizational Development at Caisse. “Studies have shown that this is a benefit.” Over at OMERS, Executive Vice President & Chief Human Resources Officer Warren Bell says that as they grow as an organization they plan to rely on internal talent development. Likewise, Teachers’ V.P. of Human Resources Marcia Mendes-d’Abreu says her team considers internal candidates before reviewing external applications. Social media has also become a key tool for funds like CPPIB and Teachers’. “In the past 18 months, we have increasingly been using LinkedIn to expand our network and promote open roles,” says Mendes-d’Abreu. 

But what separates them from every other fund using LinkedIn? Some insiders say it’s the major funds’ willingness to look to their peers for talent—although officially, there’s no active poaching. “Our strategy does not exclude recruitment from other Canadian pension funds, although we do not specifically target them in our recruitment efforts,” says OMERS’ Bell. Mendes-d’Abreu echoes this sentiment, stating that they “consider applications from candidates at other Canadian pension funds, but do not source those candidates directly.” 

Still, talent does circulate between these mega-funds. “I would say that there is a flow back and forth between Canadian plans, and we are part of that,” says AIMCo’s well-known and well-regarded leader, Leo de Bever. “In every organization, people eventually hit a narrowing job pyramid. We can often provide more responsibility at an earlier stage in life than the firms we draw from,” de Bever adds. (At Caisse, language requirements and a handful of other factors mean its main competition comes from the “Big Five” Canadian banks right across the street; Canadian pensions can pay more than their US counterparts, but salaries are relatively on par with Canadian financial institutions.) 

Despite tight competition for talent, it appears the major Canadian plans keep any rivalries cordial and poaching to a minimum. In decidedly Canadian fashion, it seems as though this quasi-gentlemen’s agreement may persist. Perhaps this is part of their strength. 

—Jordan Milne