Many important people have played a role in helping institutional investors across Asia Pacific develop over the past 20 years, but far fewer can claim to have truly broken new ground.
Some are leaders of their organisations; others have played important roles within them, helping expand their institution’s capabilities into important new areas. Each has made a telling contribution to the evolution of institutional investment across Asia Pacific over the past two decades.
Our next two profiles focus on Taiwan, and two female leaders who have made a big difference. Liu Li-Ju has, as deputy director-general, helped guide the strategic direction of the Bureau of Labor Funds, which oversees the biggest state pension plans, as it has expanded its investing since formation. Sophia Cheng has helped Cathay Financial Holdings embrace a sustainable approach to investing.
Deputy director-general, Bureau of Labor Funds
The Bureau of Labor Funds (BLF) has had two director-generals since it was formed in 2014, but only one deputy director-general. Liu Li-ju has acted as the glue between the leaders, and it’s due to her willingness to help BLF expand its investing remit that the pension fund has often been something of a trailblazer.
She joined BLF after almost two decades devising policies at the Ministry of Labor. The switch was tough, but Liu told AsianInvestor it offered her a different perspective.
She has overseen BLF’s shift into several new asset areas over the years through its annual new external mandates. It was one of the first major asset owners in Asia to experiment with smart beta investing in equity and debt. It also handed out infrastructure and multi-asset mandates in 2015, and should renew them this year.
BLF, which incorporates several smaller pension funds, has also been an early stalwart of environmental, social and governance-focused (ESG) investing. Liu has said her understanding of labour affairs made her intimately familiar with the importance of corporate social responsibility.
Chief investment officer, Cathay Financial Holdings
Cathay Financial Holdings, and particularly its insurer Cathay Life, have become increasingly forward-looking with a focus on environmental, social and governance (ESG). Sophia Cheng lies behind much of that effort.
Cheng had been chairman for Taiwan at Merrill Lynch until 2009 and in 2012 was appointed chief investment officer of Cathay Financial. In the years since, she has overseen group asset growth from $176 billion in June 2012 to $335.5 billion at the end of 2019.
During this time Cheng has upgraded the group’s 200-strong investment team with offshore and hedging experts and expanded international investing from half its portfolio to 65% in 2018. To offset the extra risk, the group has become bottom-up focused.
Cathay Life has also become an ESG advocate, signing Taiwan’s stewardship principles for institutional investors in 2016 and following the UN Principles for Sustainable Insurance too. Cheng believes ESG requires more than box-ticking, telling AsianInvestor that many companies boast about ESG while only doing the basics.
Cathay Life has built out a dedicated team of ESG analysts and a database of companies into which the insurer invests. Over 80% of its external managers incorporate ESG into their investment practices.
These profiles were taken from AsianInvestor's 20th anniversary edition, which was originally published in late June.