The man many considered a successor to Doug McTaggart as chief executive of Queensland Investment Corporation (QIC) has instead taken a permanent position as CIO of its largest client.
The $23 billion QSuper public sector fund has permanently appointed Brad Holzberger, formerly head of asset management at QIC, as its chief investment officer.
Holzberger began work as interim CIO at the fund last November, as part of QSuper’s plans to obtain an APRA licence.
To qualify for the license, the fund, whose investment policies have to date been determined by QIC and asset consultant Watson Wyatt, must have full control of its assets.
“Planned licensing has brought about the need to consider QSuper’s investment structure to ensure the trustee is fully in control of fund assets,” Rosemary Vilgan, chief executive officer of QSuper, said.
“Among this is the decision to appoint a new investment committee and internal investment resources.”
QSuper required the license so it could manage contributions from accumulation members who no longer worked for the Queensland Government, Vilgan said.
Holzberger began working at QIC in 1994, and was QSuper’s key investment adviser for more than a decade.
While the latest QIC annual report stated that Holzberger received an annual base salary of $540,000, the not-for-profit QSuper would not disclose whether the fund had matched this amount.
“I cannot comment on remuneration other than to say the board is aware of the need to reasonably remunerate to obtain the skills needed for a fund of our type,” Vilgan said.
It is understood that QIC investment staff also engage in a tiered bonus scheme, which links payments to the performance of the QSuper balanced fund and the defined benefit scheme run for both QSuper and the Queensland Treasury, and how well costs in these funds are contained. Other objectives used in this ‘scorecard approach’ are peer performance for the QSuper balanced fund, and the accrual of excess reserves in the defined benefit scheme.
The payments are calculated as percentages of annual salaries, and in good years can be up to 100 per cent of the relevant staff member’s base pay.
The appointment of Holzberger is the latest move by QSuper to strengthen its internal investment capabilities.
In February, three additions were made to the fund’s investment committee: Ian Macoun, chief executive of incubator Pinnacle Investment Management; Michael Rice, executive director with Rice Warner Actuaries; and Michael Drew, professor of finance at Giffith University and former head of investment services at QSuper.