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“Being powerful is like being a lady. If you have to tell people you are, you aren’t.” These words, spoken by Margaret Thatcher, made me smile. They also caused me to contemplate this concept of power, loosely defined as the ability to influence—an ability that human beings, by nature, aim to attain, often without knowing how to navigate the risks involved or their particular circumstances. This issue you are about to read is a reflection of how power is attained and maintained through the eyes of those whom we perceive as the 100 most influential asset owners worldwide. The list was created from our research, along with dozens of conversations with asset owners, managers, and peers. It fittingly coincides with our upcoming Industry Innovation Awards, held December 4 in New York City, a dinner celebrating strides—among both asset owners and the asset managers/servicers they employ—to advance the status quo in an industry that is often begrudging to change.
On the asset manager/servicing side, take Blackstone winning the private equity category for its pioneering work on strategic partnerships with the largest public pensions in the United States. The asset manager’s partnership with New Jersey’s state scheme is an example of note. Or look at Prudential, a winner for pension risk transfers (their landmark deal with General Motors showcases this). The winner in liability-driven investing (LDI)? Legal & General Investment Management snagged that award for the firm’s rapid growth in, and commitment to, the American LDI market following the establishment of a leading UK-based business, and for its thought leadership in the use of swaptions within LDI portfolios. All have one thing in common: they aim to innovate and push the status quo forward.
Of course, not all innovation will be successful. Collateralized debt obligations were very innovative, after all—they just helped cause the world economy to collapse. But as Notre Dame endowment chief Scott Malpass recently told me, mistakes are a necessary part of growth. So what we’re looking for, with lists such as this and awards such as these, are investors whom we perceive to be pushing forward with the right goals in mind—namely, meeting whatever liabilities are demanded of the capital pool in question.
The end result is world-class money management. The asset owners highlighted within these pages, and those in the industry receiving much-deserved awards at our December dinner, are rightly celebrated.
Of course, that doesn’t mean that they all want to speak with us. As Thatcher would point out, if they had to tell people they were powerful, they wouldn’t be. Margaret: Note my “love letter” to Harvard University’s Jane Mendillo. Hopefully next time, Jane. Hopefully next time…