The NZ Superannuation Fund (NZS) will conduct a global search for the new chief executive, a spokesperson for the over $37 billion fund said, with capacity to operate under interim leadership if a suitable candidate is not found prior to the formal exit of Adrian Orr next March.
Orr officially ends his more than 10-year stint with NZS next year to become the governor of the Reserve Bank of NZ (RBNZ) on March 27.
According to the NZS spokesperson, the fund had already begun searching for his successor but was under no pressure to fill the vacancy – currently one of the highest-paid state services job in NZ – prior to Orr’s departure.
“We have strong internal leadership if we have to continue on a temporary basis until a new chief executive is appointed,” the spokesperson said.
In an interview published last week, Orr said, the strength of the NZS board of guardians had been instrumental in the fund’s ongoing success.
“The work that we do goes beyond time horizons of any one person’s career, or any board member’s reputation,” Orr said in the interview. “They have to be in the role for the best purpose of the fund, not for the prestige of their activity.
“And I think that’s absolutely critical. We would not be able to attract and retain the people we have here at the fund if we didn’t have the operational independence that we’ve got, and board commitment to continue to run these very long-term strategies.”
Orr’s return to the Reserve Bank (where he served as deputy governor before accepting the NZS job) was widely-rumoured over the last year and has been well-received by markets.
He will probably have to give up a couple of his other roles – chair of the International Forum of Sovereign Wealth Funds and chair of the Pacific Pension and Investment Institute, prior to his exit next March.
Orr took over the top job at NZS from Paul Costello, a Kiwi who had worked in the Australian super industry for about 15 years, including chief executive of STA, prior to its merger with ARF to form AustralianSuper.
Costello then became the first general manager of the Future Fund, explaining a lot of the similarities between the two sovereign funds and their co-operative working relationship.
Catherine Savage, chair of the Guardians of New Zealand Superannuation, the Crown entity that manages the NZS, said in a statement last week: “Over the last decade, Adrian’s strong leadership, commitment to responsible investment and exceptional communication skills have been instrumental to the success of the NZ Super Fund, which is acknowledged as a high-performing global leader. Adrian leaves the NZ Super Fund in good heart, with a strong team and with an enviable track record of world class performance.
“I know that in working for the NZ Super Fund Adrian has valued the opportunity to make a contribution to New Zealand highly. The role of Governor of the Reserve Bank will enable him to continue to do this. While we are naturally disappointed to lose Adrian, we congratulate him and the Reserve Bank on his appointment, and wish them both well,” she said
“The Board of the Guardians remains committed to the NZ Super Fund’s long-term, growth-oriented approach and investment strategies.”
Orr said in the statement: “I have been immensely privileged to be employed as the CEO of the NZ Super Fund. Likewise, I am honoured to assume the role of Governor of the RBNZ next year.
“The fund – meaning its people – has grown into a world class investment institution, sitting amongst the most globally respected sovereign wealth funds. Our achievements have been a collective effort from the board through to every member of the team. I am so proud of their efforts,” he said.
“The fund has a great future ahead. Capital contributions are restarting and investment relationships are strong and lasting. The operational independence of the fund’s mandate is a critical component of this ongoing success.”
Last week the government formally turned on the NZS contribution tap after eight years in the off position, dripping $71 million into the fund. The government has budgeted NZS top-ups of $7.7 billion in total over the period to June 2022 via regular monthly instalments.
in association with Greg Bright is publisher of Investor Strategy News (Australia)
