Attracting, Motivating and Retaining SWF Talent

Ashby Monk

As public agencies tasked with investing in private markets, SWFs have to find creative ways of filling public sector jobs with individuals that can compete in and with the private sector. In short, SWFs have to be able to attract, motivate, and retain talented individuals with the necessary skills and competencies for managing a modern financial institution. While this would be a challenge in any location, it is made all the more difficult by the fact that many SWFs are located far from the world’s financial hubs. From Abu Dhabi, Alaska and Alberta to New Zealand, Nigeria and even Norway, SWFs are searching for creative ways to staff their SWFs with talented individuals. Even the China Investment Corporation, which receives 1,000 applications for every job advertised, appears to be grappling with how it can attract talented employees:

“…some CIC officials have raised doubts about following the Norwegian model. For one thing, one official said, the Chinese government agency may have trouble finding international investment professionals to join the team…Staffing has long been a problem for CIC, although over the past four years it has “reached a relatively mature position,” said an executive at Central Huijin Investment Ltd., an arm of CIC…Yet questions remain. The executive asked: “How much time do other organizations need, and what costs will be involved for them to reach maturity? Is there adequate talent?” was a question posed by a CIC official. “Where do we find these professionals? Can an incentive mechanism be created to match the task?”

The CIC is not alone in struggling with these challenges; I’ve heard these same questions repeated by funds the world over. It’s hard to find savvy financiers willing to work for public salaries in bureaucratic work environments (which is why it can be quite useful to set SWFs up as special purpose vehicles outside typical government pay scales and structures).

Anyway, since the ‘unnamed CIC source’ mentioned the “Norwegian model” above, let’s take a look at the NBIM’s talent management. After all, Oslo is not what I would call a global financial center. So how has the NBIM attracted its investment staff?

The NBIM has roughly 280 employees from 25 nations spread over five global offices (Oslo, London, New York, Shanghai and Singapore). So, the first thing to note is that the NBIM is not trying to attract all the talent to Oslo. Instead, the SWF has moved itself closer to the talent, which seems a smart move for attracting foreign professionals. In addition, the NBIM has developed a four year (!) internal training program to develop home-grown professionals called the “International Talent Program.” Here’s a blurb from NBIM CEO, Yngve Slyngstad:

“Our candidates will learn and excel over a four-year period, through internal rotation periods within NBIM, exchange programs with international investment banking institutions and an MBA degree from a top business school. It is our aim that by the end of the ITP you will become one of our high-potential specialists who we count on to achieve our goals. The fast-track training offered by the ITP equips people for success in the investment industry.”

It’s an interesting approach to developing internal capabilities: one year at NBIM; one year in London, New York or Asia; one year back at NBIM; one year at international MBA; and, finally, a job as a “high potential specialist” back at NBIM. By the way, if you think that’s a long-term approach, recall that ADIA spots talent while they’re still in high school and begins nurturing them for positions of importance at the Abu Dhabi SWF. Now that’s long term.

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This website is a project of Professor Gordon L. Clark and Dr. Ashby Monk of the School of Geography and the Environment at the University of Oxford. Their research on sovereign wealth funds is funded by the Leverhulme Trust and The Rotman International Centre for Pension Management.

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