NZ Super exec wins plum role at CalPERS

NZ Super's investment chief has quit the sovereign wealth fund to take up the same job with CalPERS, the US$494 billion pension plan.

Interestingly, the news of Stephen Gilmore's exit comes exactly one week after NZ Super named former Funds SA head Jo Townsend its new chief executive.

Gilmore - a one-time chief investment strategist for the Australian Future - was reportedly a candidate for the top job.

The outgoing executive will take up the CIO role at the California Public Employees' Retirement System in July, ending a seven-month vacancy.

NZ Super said Gilmore is not leaving until the end of the current financial year and the process to appoint a replacement will be led by Townsend.

Acting chief executive Paula Steed noted the "significant contribution" to the sophistication of NZ Super since he joined in early 2019, during which the fund has nearly doubled in size.

"He has championed the role of new technology in enabling better investment decision-making and brought innovative and disciplined thinking to our investment processes. And, as chair of our responsible investment strategy refresh, has been key to our shift towards a sustainable investment approach."

CalPERS chief executive Marcie Frost pointed out that Gilmore has overseen the world's best-performing sovereign fund with annual investment returns of more than 12 per cent over the past decade.

"He brings not only a wealth of investing knowledge to the job, but he also has the temperament to understand the needs of our members and public sector employers who depend on Calpers to be a steady, long-term partner."

For his part, Gilmore expressed gratitude to CalPERS' leaders for trusting him to help shape the pension plan's next chapter.

"There are high expectations, and rightly so, when it comes to fulfilling the promises made in serving those who serve California," he said.

Before joining the NZ Super, Gilmore was chief investment strategist at the Future Fund and held senior roles at AIG Financial Products, Morgan Stanley and the IMF.

The base annual salary for the CIO role at is US $718,750.

The job is not without its challenges.

The outgoing executive succeeds Nicole Musicco, who left CalPERS last September after just 18 months, citing family reasons.

Her predecessor, Ben Meng, stepped down within two years of becoming CIO.

CalPERS reported an annual return of 5.8 per cent in the 12 months ending June 2023, following a negative 6.1 per cent in the previous year.

That fell well below the 6.8 per cent target.

As for his time with NZ Super,  Gilmore said it has been a great "privilege and pleasure" to have been able to work with such a talented and dedicated team over the past five years.

"The Guardians of NZ Superannuation has an inspirational purpose and is, in many respects, world-leading. I look forward to celebrating its future successes."