Stephen Dunne, the former chief executive of AMP Capital, is to become chair of the investment committee for the $31 billion construction workers industry fund Cbus.
Dunne, who oversaw the development of AMP Capital to become a $156 billion funds management operation, will bring the expertise and know-how to help nurture the increasingly ambitious ideas of the 30-strong investment team at Cbus.
The appointment of Dunne aligns with the heightened legal expectations of boards to understand and to be accountable for their investment strategies.
Dunne will replace Peter Kennedy as chair of the investment committee in February 2016.
One of the potential enhancements being considered for the investment strategy is the centralisation of cash held by external fund managers, a task that has risen in importance due to the large cash positions held by equity managers this year. The aim is to get a better rate of return for this cash and by increasing exposures in cash-like investments. Cbus’ cash allocation currently stands at around 10 per cent and the fund has been building up its internal capabilities and systems to manage a proportion of this internally.
The super fund is also tailoring mandates with its fund managers, in contrast to the growing trend amongst other sizeable funds to bring investments in-house.
Kristian Fok, executive manager of investment strategy, said the fund was managing the portfolio in a smarter way, identifying where the biggest risk exposures and opportunities are and generally thinking about the portfolio more granularly.
Fok predicted more alternative beta type strategies will provide flexibility to overweight the fund to a particular sector or risk exposure during investment cycles.
Dunne spent 22 years at AMP and was succeeded by Adam Tindall, who was promoted from director and chief investment officer of property to become the chief executive of AMP Capital in October 2015.
Prior to this Dunne held a number of roles at National Mutual Funds Management. He is a Chartered Financial Analyst and a member of The Ethics Centre (formerly known as St James Ethics Centre) which aims to help businesses make ethical decisions.