2018 NextGen

“Brett is a highly intelligent investor with a great range of experience, having worked within the asset owner, funds management, and asset consulting space. One of his biggest strengths is his capacity to build diverse and experienced teams. Brett has played a critical role in helping to develop and implement our new investment model.”

— Kristian Fok, CIO of Cbus

After reaping the rewards of the Super Fund’s internal team and alpha-building strategies, the public markets head’s eyes are on finalizing the restructure of the emerging markets portfolio and the buildout of the opportunistic growth portfolio while preserving the fund’s culture and navigating allocations in the coming years.

With around 18 years of industry experience, Brett Chatfield has helped the fund’s internalization process stay the course. The $33 billion fund is planning to expand its team and manage more than 30% of the fund’s assets internally. Chatfield previously served as a senior consultant at Frontier Investment Consulting and in senior analyst roles at large Australian superannuation fund UniSuper and research house Lonsec. He is a previous CIO Forty Under Forty winner and is working on his second master’s degree (Applied Statistics).


CIO: What are the accomplishments you are most happy to have achieved recently, and why?

Chatfield: Over the last two years, we have significantly expanded the investment capability within the fund and have commenced internalizing several strategies. Our fund currently manages US$33 billion and we are targeting to manage over 30% internally in the next three to five years.

I have been heavily involved in the internalization of equity and debt strategies and have been very pleased with the success that we have had in building high-caliber internal teams with strategies that should deliver strong long-term results. While still in early stage, we are seeing the strategy bearing fruit in terms of both strong performance and cost savings.

I have also been very pleased with the returns the fund has delivered to members, and specifically within public markets we have been able to generate substantial alpha. This has assisted in us being able to deliver good returns that are also highly competitive versus peers.


CIO: What would you be most excited to accomplish in the year ahead, and why?

Chatfield: As our internalization program is a multi-year rollout, I am very keen to ensure that it remains on track and continues to deliver the desired benefits. In the coming year, we have several strategies expected to be launched.

Outside of the internalization efforts, I am also keen to finalize the restructure of our emerging market equity portfolio, and to complete the buildout of our opportunistic growth portfolio, which will have an enhanced risk/return profile compared to its current structure.


CIO: What’s the most rewarding aspect of being an asset owner?

Chatfield: Ultimately the most rewarding aspect is generating strong returns for members so that they can have a better retirement. As an all-profits-to-members superannuation fund in Australia, everything we do is about maximizing risk-adjusted returns for members and we see managing their money as a privilege that we take very seriously.


CIO: What’s the most challenging?

Chatfield: The most challenging aspect is really time management as there is so much we want to do and thus it is important to work hard and to prioritize well.


CIO: What are you most hopeful about in the future of the industry?

Chatfield: I am currently involved in a sponsorship initiative that supports the development of emerging female leaders in the funds management industry. I hope that over time, the industry becomes more diverse, both in terms of gender, but also a range of other dimensions such as academic background and experience, as I believe that this will lead to a more effective and successful industry.


CIO: What are you most cautious about?

Chatfield: From an internal perspective, I am very focused on ensuring we preserve the strong culture in the team as we undergo significant expansion in size. Looking outwards, I am cautious about the medium-term outlook for returns given debt levels, valuations, and demographics, and believe that careful asset allocation navigation over the coming years will be critical.


CIO: As a leader, what are the most important aspects of the industry you hope to change over your career?

Chatfield: Beyond the greater diversity discussed above, I aim to influence greater focus in the industry on the importance of ESG (environment, social, and governance) factors from a long-term return perspective. The industry can often be very short-term focused. This can place insufficient emphasis on such issues that in my view can have a material impact on long-term expected returns and risk.


CIO: If you had one piece of advice for your peers, what would it be?

Chatfield: Constantly learning and evolving is critical, and aim to read as much and as widely as you can.


CIO: What are the biggest current trends you are seeing that have surprised you?

Chatfield: There is a clear trend in the greater use of passive strategies, including ETFs. I personally think it isn’t the right time to be going passive just to reduce costs. In my view, many investors will look back and question why they have foregone better returns in the pursuit solely of lowering costs.