David Neal, the head of Watson Wyatt’s investment consulting practice, will become chief investment officer of the Future Fund on July 16.

Confirming rumours that have been circulating for over six months, Neal will leave Watson Wyatt on June 22 and will relocate his family to Melbourne from Sydney before starting at the Future Fund’s offices next month. Watson Wyatt’s asset consulting contract with the Future Fund is unaffected. Neal said the initial rumours of his departure from Watson Wyatt late last year were “totally unsubstantiated”, and that he only began talking with Paul Costello, Future Fund general manager, in March. “Even then it was still an informal discussion,” he said. Concrete discussions began about eight weeks ago and Neal informed Watson Wyatt two weeks ago. Neal said he decided to take the position since getting to know the fund and its board after Watson Wyatt was appointed as asset consultant to the fund in November last year. “This fund has the capacity to do best practice investment. It can take advantage of some of the best investing opportunities in the market,” Neal said. Neal also cited the fund’s extremely strong governance structure and its “clear single focus” as reasons for taking up the position but would not comment on whether it could be hostage to government policy. “I’m obviously not concerned otherwise I wouldn’t have taken the position,” he said. Another reason for taking the “once in a lifetime opportunity” was the chance to build an investment team from the ground up. “That’s something I’ve really enjoyed doing at Watson Wyatt,” he said. Neal would not reveal details of the fund’s investment policy. “It’s not like the board has been sitting on their hands. We’ll be working to get a robust strategy in place,” he said. Graeme Miller will take over as head of Watson Wyatt’s investment consulting practice and the consultant is currently looking at employing at least two senior consultants in Sydney to replace the gaps left by Neal and principal Andrew Spence (who will join Hyperion Asset Management). “The structure of the team will be different under my leadership but to a large extent that will depend on the people we bring in,” Miller said. David Neal has long been identified as the ‘face’ of Watson Wyatt but Miller said the company has made a concerted effort over the last twelve months to promote other senior members of its well-resourced 26-member consultant team. “It has been strategic but not in the sense of preparing for David’s departure,” Miller said. The Future Fund currently oversees $51 billion and is forecast to grow to around $150 billion by 2020.

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