AsianInvestor’s annual institutional excellence awards are designed to identify, recognise and celebrate the asset owners of the region that are either best-in-class in their institutional areas or geographies, or are fast strengthening their capabilities and worthy of notice.
Asset owners across the region are operating at an increasingly high standard in many areas of their operations. In addition, market conditions have been turbulent, making for tougher investing.
While that has made choosing the final winners more difficult, it is also pleasing to see a growing crop of impressive institutions across the region.
This year's winners by country and region combined continued improvements in their processes and internal resources with an astuteness to create increasingly complex investment portfolios amid tougher and less predictable markets.
The fund has dedicated itself to ensuring its assets are ESG-compliant, arguing that doing so is the best means to ensure the long-term stability of its returns and also to ensure it's doing its part preventing environmental catastrophes in the future.
These are not mere words; as of February 2018 its then-chief executive Wan Kamaruzaman Wan Ahmad said up to 60% of its assets under management did comply with ESG, while noting that KWAP was the first institutional investor in Malaysia to head a dedicated investment team to focus on shareholder activism, including investigating the level of carbon footprint exhibited by local companies into which it invests. It is an active signatory to UN PRI too, and the agency has commended it for acting as a role model in its willingness to implement ESG into its investment standards.
And KWAP is not finished yet. In June, the pension fund said it intended to extend its ESG mandate into alternative asset classes as well, including private equity and real estate mandates. It also said it would invest MYR800 million ($196 million) into new global ESG initiatives, via two external fund managers. That funding was part of MYR3.8 billion it has set aside for exclusively ESG investments.
The deputy director-general of Taiwan’s Bureau of Labor Funds has been at the organisation for 11 years now, after almost two decades at the Ministry of Labor. And during her time there Liu has helped the organisation form a reputation for embracing investing ideas and offering mandates that often break ground, particularly when compared to other regional pension operators.
Liu has told AsianInvestor that she considers her ministry background to offer her a perspective on BLF’s role as an investor and institution, not least on worker rights and corporate social responsibility. She can take credit for helping influence BLF’s interest in extolling ESG in Taiwan, most particularly via the creation of a domestic ESG index that it assigned funds to in 2018.
BLF has broken ground in several investment areas, including bringing smart beta-style mandates in 2011 when it was not mainstream, adding alternative mandates, and more recently bringing in ESG investment contracts, as well as absolute returns and active emerging market mandates, as the pension fund seeks to adapt to more volatile market conditions.
But while Liu – who fund salespeople and consultants consider to be an effective spokeswoman for BLF’s strategy and plans – has helped give the pension fund room to experiment, she is also focused on risk. BLF keeps new mandates contained and assesses them before expanding.
That focus on experimentation but a firm eye on risk control stands BLF in good stead, and is a testament to effective leaders such as Liu.