RECRUITMENT
Currently, the large superannuation funds are reporting a long queue of fund managers eager to join their internal teams. This would not be so surprising, but for the fact that many are taking pay cuts or losing out on generous bonus schemes to leave their jobs.
Part of the appeal is that the fund managers can stay at their desks all day and analyse and trade, rather than having to woo new clients or hold the hands of existing ones. Of course, there are internal stakeholders to be kept happy at superannuation funds, but it is a single body, a single portfolio and a single purpose without profits to shareholders diluting returns.
As John Pearce, chief investment officer of UniSuper, and a former fund manager at Colonial First State puts it: “I did not appreciate how liberating working for a profit-for-members business would be.”
It is worth noting, that while super funds are in vogue for the recruitment of fund managers, this situation could be easily switched as rising stars on internal teams are tempted away by salaries from external fund managers. Indeed, the not-for-profit super funds have found some of their culture being changed by the recruitment of ex-fund managers.
Pearce is famous within the industry for earning the largest bonus of any investment team member at a super fund. In 2015, he earnt a AU$653,586 bonus on top of a total base pay and super package of $701,693. This was awarded for hitting performance targets – the balanced fund at UniSuper returned 11% for 2014/15. It also acknowledges that his oversight of $25bn of internally-run assets, has contributed to a lowering of fund management costs.
