AsianInvestor's Top 10 sovereign wealth fund (SWF) executives in Asia list is aimed at recognising exceptional senior executives -- from CEOs and CIOs to alternatives and sustainability specialists -- responsible for leading the industry’s growth and development.
With the right governance structures in place, SWFs can be particularly valuable in preserving and growing a nation's savings.
We believe it is important to acknowledge the role key individuals play in boosting the influence of SWFs in the region, especially as these entities are set to grow in importance in coming years.
It's also important to recognise that not all SWFs are the same – they can have vastly different mandates and investment goals. AsianInvestor recognised those differences as we created our list.
You can find out more about the rationale for our Top 10 SWF executives in Asia list here.
Today, we feature two senior executives from Indonesia and South Korea.
Indonesia Investment Authority is one of the 'new kids on the block' in the Asian SWF landscape, making its debut on the international stage in early 2022.
Despite initial reservations from industry observers about the wealth fund and its ability to operate independently, INA has emerged as a strong institution, partnering with some of the world’s leading pension funds and sovereign wealth funds to make targeted investments.
One of the executives credited with driving INA's ambitions and actions is Deputy Chief Executive Arief Budiman. “We want to facilitate and create real change,” Budiman told AsianInvestor.
“In two years, together with INA’s co-investors, we have already deployed more than $3 billion, more than most other funds that are as young.”
The Wharton School MBA graduate has extensive experience in finance and dealing with interational investors, which have proved beneficial at INA – he was previously CEO of Danareksa, Indonesia’s first securities and brokerage company, and was also CFO at Pertamina, Indonesia’s only Fortune 500 company.
Budiman is also often the key executive representing INA when the fund has to explain the rationale behind investments to an international audience.
The wealth fund makes strategic bets on sectors that offer large growth opportunities, driven by the unique characteristics of Indonesia, such as a young population, rich resources, high technology adoption and urbanisation.
Currently, its four areas of investment are transport & logistics, healthcare, digitalisation and digital infra, and green energy and transformation.
It also has a dual mandate – to invest and create value for future generations while bringing in capital and capabilities that can help unleash Indonesia’s potential.
“To do both, we need to look at various factors, such as commercial viability, the sustainability of growth and where we can be genuinely competitive on the global scale and appetite of investors,” said Budiman.
Some of its high-profile partners include China’s Silk Road Fund, British International Investment, Denmark’s Investment Fund for Developing Countries, the Netherlands' APG and UAE’s Abu Dhabi Investment Authority.
Projects have ranged from pharmaceutical deals and toll road development to modern warehouse and data centre buildouts.
“We hope that we have demonstrated encouraging results with our investments and partnerships. From a qualitative perspective, we want to be one of the most credible investment institutions in Indonesia,” said Budiman.
INA is considered part of an emerging breed of catalytic SWFs that invest locally and promote foreign investors to invest in Indonesia as well.
Its success has spawned ambitions among other countries without trade surpluses to consider developing SWFs aimed primarily at developing the local economy and infrastructure while building sovereign wealth.
The fund also takes its sustainability responsibilities quite seriously.
“We want to follow global best practices, especially on ESG standards, and will continue to improve, because we want to be seen as high-quality investors,” added Budiman.
The fund plans to expand its collaboration network and investment opportunities in 2024.
“We want to continue to scale because that will help us do and accomplish more not just for ourselves but for Indonesia’s sustainable development,” said Budiman.
Chief investment officer, Korea Investment Corporation
Lee Hoon’s influence on Korea Investment Corporation (KIC) started long before he was appointed chief investment officer (CIO) in August 2022.
Stepping up from the role as head of investment strategy and innovation division at the fund, the internal hire of a new CIO – only the second time since KIC was founded – was seen as a safer choice at a time when global markets were quite turbulent.
“This CIO selection is quite different for KIC since the global markets have been in a state of emergency in the last few years compared to many previous years,” one Seoul-based advisor with insights into the recruitment process told AsianInvestor, on condition of not being named.
Lee Hoon, who joined KIC in 2014, has extensive experience as an analyst and has worked with some well-known local securities firms in the past.
Instead of merely continuing a “business as usual” approach, as CIO, Lee took charge of revamping KIC’s strategy to adjust to the changing macroeconomic landscape.
The sovereign fund has introduced a new “strategy asset” platform focused on achieving stable, absolute returns, Lee told delegates at AsianInvestor’s 15th Institutional Investment Forum Korea in Seoul in June 2023.
“Unpredictability is the new norm,” Lee said, explaining why KIC decided to introduce the new platform.
The core objective is to achieve annual returns of cash plus an additional 2-3% while reducing portfolio volatility.
KIC aims to accomplish this target by combining multiple assets with specific characteristics to maximise diversification and pursue stable returns, executing on a "so-called all-weather strategy," according to the CIO.
"This approach is designed to effectively manage risk and generate stable income regardless of prevailing market conditions,” Lee said.
The Korean wealth fund is also moving faster on plans to increase the share of alternatives in the portfolio. The target is to have alternatives account for 25% of total AUM by 2025, ahead of a previous plan to hit that target by 2027, Lee said.
Alternatives accounted for 22.7% of KIC's portfolio at the end of August 2023.
In current markets, KIC sees opportunities to invest in high-quality assets with attractive valuations despite liquidity tightening, especially within private debt and infrastructure.
To find such high-quality assets within alternatives, KIC continues to roll out a boots-on-the-ground strategy under Lee’s tutelage.
It has regional offices in Europe and US and the next step is opening an office in Mumbai, with a focus on finding the right alternative investments in the rapidly developing economy of the the world’s most populated country.