Mark Wiseman Named Chair of AIMCo's Board
Mark Wiseman has been named chair of the Alberta Investment Management Corp.Geoffrey Morgan of the National Post also reports that ex-CPPIB CEO Mark Wiseman to chair AIMCo as Alberta eyes pension fund overhaul:
The former chief executive of the Canada Pension Plan Investment Board was ousted from BlackRock in December for violating the company's workplace relationship policy.
His appointment will be effective July 1, AIMCo said in a press release on Friday evening.
"Mark's accomplishments in investment management, his strategic thinking and leadership make him an excellent choice to chair this board," said outgoing chair Richard Bird in the release.
Wiseman said in the release that he looks forward to working with his fellow directors, and AIMCo said Wiseman will be donating his compensation as chair to the United Way to assist communities across Alberta.
In 2016, Wiseman left the CPP for BlackRock. He had been touted as a potential successor for the global investment company's CEO.
But in December he left the firm after violating its relationships at work policy, according to an internal memo.
His wife heads BlackRock's Canadian operations but the relationship was reportedly with a different employee.
AIMCo has a portfolio of about $119 billion, which represents hundreds of thousands of Albertans' pensions and accounts like the province's Heritage Savings Trust Fund.
The Crown corporation has been under scrutiny recently after it lost $2.1 billion on a single investment strategy and for investing in oil and gas companies despite that sector's struggles.
BlackRock has said it will put climate and sustainability at the heart of its investment decisions, and prices carbon risk into its portfolios.
Alberta has tapped Mark Wiseman, the former head of the Canada Pension Plan Investment Board, to chair its pension fund at a time when the province is considering breaking away from the Canada Pension Plan and take control of its own pension assets.AIMCo put out a press release on the appointment of Mark Wiseman as Chair of AIMCo's Board of Directors:
On Friday, the Alberta government appointed Wiseman, who was most recently with New York-based investment management firm BlackRock Inc., to head the board of the Alberta Investment Management Corp., which manages $119 billion of the province’s public pension assets.
Alberta’s finance minister Travis Toews said Wiseman “brings deep experience in large fund management and, given his experience and background, we believe he’ll be a great fit as chair of AIMCo.”
The appointment comes as Alberta’s Fair Deal Panel released a report this week on how the province should take control of its affairs and reduce its contributions to Ottawa, as many Albertans believe they’ve paid far more into the country than they receive in return. Premier Jason Kenney created the panel last year to gauge the mood of Albertans and determine better ways the province could assert itself in the country.
That report recommended Alberta’s government manage its own residents’ pension investments, similar to the Caisse de dépôt et placement du Québec, rather than through the CPP.
Doing so would mean that Albertans would pay less in pension contributions as they reside in a province with one of the youngest populations in the country and have fewer current pensioners than other provinces.
In an interview with the Financial Post on Friday, Toews said the province did not appoint the former CEO of the CPPIB as a precursor to channeling its pension contributions to AIMCo.
“We haven’t appointed Mark specifically because we’re considering the merits of an Alberta pension plan. We brought Mark in because we have a very substantial fund in the province and we want it managed well,” Toews said.
“There’s no doubt as we look at the merit, opportunities and perhaps risks of an Alberta pension plan. Should the province go in that direction, we will certainly need strong leadership,” Toews said.
In recent months, AIMCo has come under increasing scrutiny for losing billions of dollars through its volatility-based investment program and for directly investing in a number of small and risky Alberta-based oil and gas companies, which have continued to struggle with persistently low oil prices and lack of access to markets.
Toews said the pension manager is operationally independent from the government of Alberta and Wiseman was not appointed to steer AIMCo towards or away from specific types of trading activity.
“AIMCo has had a challenging quarter as I would expect most asset management firms have had — it’s a rollercoaster of extreme volatility,” Toews said of the fund’s recent performance. AIMCo said it had recorded $2.1 billion in losses on volatility trades, in a letter dated April 21 and posted on its website.
Wiseman’s other previous roles include being responsible for the private equity fund at the Ontario Teachers’ Pension Plan. He was also an officer at Toronto-based merchant bank Harrowston Inc. before its purchase by TD Bank Group in 2001.
“I look forward to working with my fellow directors as AIMCo continues to serve its clients for the long-term,” Wiseman said in a statement.
Most recently, Wiseman was the global head of active equities at BlackRock, Inc., the world’s largest asset manager with US$7 trillion in assets under management.
Analysts believed he was on the short list of executives capable of succeeding Blackrock chairman and CEO Laurence Fink. But Wiseman left the firm abruptly last year for violating the company’s “relationship at work” policy.
Wiseman apologized to his colleagues in a memo in December and said that he did not disclose a consensual relationship with a colleague at the company. While Wiseman ran the equities business based in New York, his wife Marcia Moffatt ran the firm’s Canadian business from Toronto as country head.
Wiseman is taking over the chair role at AIMCo on July 1 from Richard Bird, a former chief financial officer at Enbridge Inc., who is finishing his second three-year term at the pension manager.
Alberta Investment Management Corporation (AIMCo) today announced the appointment and designation of Mark Wiseman as a Director and Chair of the Board of Directors effective July 1, 2020, upon the completion of current Chair Richard Bird’s second three-year term as a member of the AIMCo Board. This announcement follows the signing of the Order in Council, O.C. 186/2020, by the Lieutenant Governor of Alberta.Alright, it's Monday and I've been bombarded all weekend by people asking me: "Did you hear about Mark Wiseman?".
“On behalf of my fellow directors, I welcome Mark Wiseman to AIMCo’s Board. Mark’s accomplishments in investment management, his strategic thinking and leadership make him an excellent choice to Chair this Board,” said Mr. Bird. “I am honoured to have had the opportunity to serve on the Board and I thank everyone at AIMCo — and Albertans — for their support.”
“I look forward to working with my fellow directors as AIMCo continues to serve its clients for the long term,” said Mr. Wiseman. “I, along with members of the board and employees of AIMCo, would like to thank Richard for his service to the province during his two three-year terms. He has offered a steady and experienced hand in guiding the organization’s strong governance and investment decision-making.”
Mr. Bird has continued the tradition of exceptional chairs leading AIMCo. His efforts over the past six years as a member of AIMCo’s Board of Directors, the last three as Board Chair, have strengthened the independence of the organization, while fostering closer alignment to its clients.
At the request of the incoming Board Chair, in order to ensure a smooth transition, Mr. Bird will stay on as a consultant to the Board for the transition period at a salary of $1.00.
Mark Wiseman is a leading investment manager and experienced corporate executive. He was formerly President and CEO of Canadian Pension Plan Investment Board. He was Global Head of Active Equities for BlackRock, Inc. and Chairman of BlackRock Alternative Investors, and also served as Chair of the firm's Global Investment Committee and on its Global Executive Committee.
Previously, Mr. Wiseman was responsible for the private equity fund and co-investment program at the Ontario Teachers’ Pension Plan; was an officer with Harrowston Inc., a publicly traded Canadian merchant bank; and a lawyer with Sullivan & Cromwell, practicing in New York and Paris. He also served as a law clerk to Madam Justice Beverley McLachlin at the Supreme Court of Canada.
Mr. Wiseman was a member of the Advisory Council on Economic Growth, which advised the Canadian Finance Minister on economic policies to achieve long-term sustainable growth.
Mr. Wiseman holds a Bachelor of Arts from Queen’s University and a law degree and Masters in Business Administration from the University of Toronto. He was also a Fulbright Scholar at Yale University, where he obtained a Master of Laws. He is a certified member of the Canadian Institute of Corporate Directors.
He serves on the board of several non-profit organizations, including Alpine Canada, the United Way of Greater Toronto, Sinai Health Services, the Capital Markets Institute and the Dean’s Advisory Board at the Rotman School of Management, the University of Toronto's graduate business school.
As part of a demonstrated history of giving back to the communities in which he lives and works Mr. Wiseman will be donating his compensation as Chair of the Board to the United Way to assist communities across Alberta.
Of course I did, I'm Mr. Pension Pulse, my tentacles are everywhere, I even sometimes hear things before they hit the wire (just kidding).
In this case, I got alerted on Friday afternoon and immediately sent an email to Mark Wiseman congratulating him and wanting to get more on the record. More on that below.
Now, reactions to this appointment are understandably mixed.
One person lamented:
Despite living in a world of heightened ESG, I would have thought the 'failure to disclose' would have rendered Wiseman ineligible to make the short list. A former partner of mine lost his position with the wholesale division of the Bank for the same reason. It is not so much the extramarital affair but it's failing to follow protocols and rules; what else is not reported.A few women I know also expressed similar concerns about appointing Mark Wiseman and what message it sends to women working at AIMCo.
Others (all men) were much more positive about this appointment:
Good for Mark. Now he can put that misery at BlackRock behind him. Onward and upward! AIMCo needs him. With Barb there as well now, they have the best to clean it up.And this:
[...] it is not fair to be too critical of this appointment. Mark has excellent experience and although he made a mistake at Blackrock, it’s something people should be able to move on from in time. I have not heard the best things about Kevin Uebelein, so a new CEO could be in the cards. Let’s see.Now, what are my thoughts on the appointment of Mark Wiseman as the new Chair of AIMCo? Here I will be brutally honest and won't hold anything back:
- There's no question Mark made a huge mistake at BlackRock. A few CEOs told me personally "it's unfortunate, he really lacked judgment." Mark himself took responsibility and owned his mistakes.
- The world read BlackRock's version about why Mark left after failing to disclose a 'consensual relationship' with colleague. I agree with those who state "BlackRock had no choice but to bump Wiseman off. In the first place, he contravened the sacrosanct BlackRock code of conduct which says you have to report relationships with colleagues."
- However, Larry Fink didn't handle this affair quietly, he made an example of Mark Wiseman to send a clear message throughout his firm.
- In a sense, Mark was the sacrificial lamb at BlackRock, not that I feel sorry for him, but it left a bad taste north of the border and Larry Fink pissed off some very powerful people in Canada (not that Fink gives a damn!).
- Anyway, I've always maintained this was a sad state of affairs and it's a personal family matter and that people shouldn't judge without knowing all the details. My father, an 89-year-old psychiatrist and the man I respect the most in the world, wasn't fazed in the least: "If you only knew what I know about extramarital affairs from men and women, it's very common at workplaces, people love to judge others without knowing anything about them or their relationship. It's unfortunate but it happens a lot more often than you think."
- Mark made a mistake, he owns it, we don't need to keep referring to it because there are other people involved. I've met Marcia Moffatt and she is a very nice, smart and classy lady, they have kids together, so there's no point focusing on the past, what's done is done, if you are to judge a man (or woman) by things they've done in the past, nobody would run for public office!
- My concerns about Mark Wiseman being appointed Chair of AIMCo have nothing to do with what happened at BlackRock. It's time we all move past that. My concern is when we place a former CEO of a major Canadian pension fund as the new Chair of another major Canadian pension, they need to disclose their relationships with the current CEO and the senior staff there.
- More to the point, sure Mark Wiseman, Ron Mock, Jim Keohane, Michael Latimer, Henri-Paul Rousseau, and other former CEOs are all competent enough to be the Chair of any pension board, but this appointment is a little too close to home, and that raises red flags on potential conflicts of interests. That's why you typically don't see any former CEO of a major Canadian pension fund being appointed as Chair of any other of Canada's large pensions. Michael Sabia did return to be the Chair of the Canada Infrastructure Bank but that's not the same as being in charge of the board at a large Canadian pension.
- Let me give you a scenario. Mark Wiseman becomes acting Chair on July 1st. He decides to get rid of Kevin Uebelein based on the review of the vol blowup and replaces him with his buddy at BlackRock, André Bourbonnais, who is PSP's former CEO. You don't think people will be talking and rolling their eyes? Of course they will even if they believe André Bourbonnais is better qualified to run AIMCo than Kevin Uebelein.
- Or what if Mark Wiseman directs AIMCo's Private Equity to direct a substantial allocation to BlackRock's Long-Term Private Private Capital which is headed up by André Bourbonnais? Even if that investment has merits, there will be grumblings about a major conflict of interest.
- Truth be told, these are all speculation scenarios right now, but if I'm thinking it, others are also thinking it and some opportunists will try to use their relationship with Mark Wiseman to "score big" with AIMCo.
There's no way he didn't privately think about all these issues I raised above before accepting this nomination. He knows he will be under the microscope and if he does anything remotely shady, he's toast.
Look at the guy's credentials and experience, people like Mark Wiseman don't get to where they are without thinking ten steps ahead.
Moreover, if you ask me, there's no way this was an easy decision. I'm sure part of him said "no way do I want to touch this position with a ten foot pole."
In order to make this a bit more politically palatable, he decided to donate his compensation as Chair of the Board to the United Way to assist communities across Alberta.
Very nice gesture but if you ask me, he deserves every penny of the roughly $110,000 remuneration he will get as Chair of AIMCo (the board members at AIMCo should get compensated a lot better from their clients and the Government of Alberta!).
I'm tired of reading stories about Michael Sabia not being compensated during the early years at the Caisse or not accepting a severance package or Mark Wiseman "donating his compensation" to the United Way of Alberta.
Importantly, if you want to save the world, by all means go ahead, it's very noble of you but do it on your own private time, I don't want to read about it publicly!
And speaking of "donations", I'm tired of reminding the folks at AIMCo and elsewhere about their annual donation to Pension Pulse, it's the least they can do.
"Yeah but Leo, you've been on their backs on this blowup, writing several comments on it":
- AIMCo's $3 billion volatility blowup?
- AIMCo to conduct review of volatility blowup
- AIMCo CEO responds to volatility blowup
- Barb Zvan to Review AIMCo's Vol Blowup
- AIMCo's All Too Familiar Vol Blowup?
I by no means have a monopoly of wisdom on pensions and investments but the main reason why over 2,000 people read me every day is because I try to be as fair as possible in my opinions and often get feedback from senior pension executives and other experts.
Anyway, let me close by stating I did exchange brief emails with Mark Wiseman on this appointment and he shared this with me:
I don’t start until July 1st, so not much that I can say or even know until then.I pressed him on whether they came after him following the vol blowup or if he lobbied for the position but Mark didn't bite: "Let’s chat more when I am officially in the chair."
Busy times for me. Hillhouse & BCG (Senior Advisor x2), Interim CEO of Alpine Canada and now AIMCo. Full plate…. For now…
Fair enough, let Mark assume the role of Chair at AIMCo and then we can chat when he is better informed on all its operations.
The good thing is Mark knows Barb Zvan very well and he will definitely listen to her feedback on what went wrong. Who knows, he may even appoint her the next CEO (pure speculation on my part!).
What else? Mark Wiseman isn't just a private equity expert, he's also an ESG expert, and that's a huge positive for AIMCo. He really knows his stuff and will be an asset to the organization.
Lastly, in a recent comment on reversing Alberta's public pension changes, I emphatically stated the following:
The amalgamation of ATRF and AIMCo can be a win-win for all Albertans if done properly.Let me be crystal clear, I don't care if Mark Wiseman is the new Chair of AIMCo, I still firmly believe it's a totally bonehead move on the part of the Government of Alberta to contemplate opting out of the Canada Pension Plan to start an Alberta Pension Plan.
But let me clear on something, opting out of the Canada Pension Plan to start an Alberta Pension Plan is a bonehead move which will set Alberta back years, if not decades.
AIMCo and ATRF are great organizations but no match whatsoever for CPPIB and anyone who disagrees with me can take it up with me privately but make sure you know your stuff.
Alberta needs to get on with it already, stop spreading lies and misinformation, get the review of AIMCo's vol blowup behind them, make the findings public, and stop dithering on public pensions.
Enough is enough already, I'm tired of writing about Alberta's pension woes, get your act together already!
I suspect Mark Wiseman (privately) agrees with me, keep the Canada Pension Plan intact and let CPPIB manage the CPP assets of Albertans.
Once again, this blog is a collection of my opinions, feel free to email me your opinions whether or not you agree with me at LKolivakis@gmail.com. I'm speaking on my behalf, nobody else's.
Below, take the time to watch a recent panel discussion on pensions and the pandemic moderated by Mark Wiseman featuring Blake Hutcheson, Kevin Uebelein and Jane Rowe.
Like I stated above, as the new Chair of AIMCo, Mark has to remain impartial and make sure that organization runs on the very best governance principles. I'm sure he'll do a great job.
Update: A blog reader sent me this after reading this comment:
As expected, the blog about Mark Wiseman’s appointment is much more than that one can get from a press release.I referred him to AIMCo's website where they discuss Board governance here and more specifically to a document on Board recruitment and reappointment. Note the following: "The Minister and Cabinet shall decide whether to approve the reappointment of any individual recommended by the Nominating Committee."
One aspect I’m curious about is if you have insights – what’s the process of appointing the chair of the board for such an organization? The news releases touched upon the Government of Alberta announced it, without diving into details of the process. I’m sure many others in the industry would know it, yet it doesn’t hurt to remind all of us.
Lastly, a former pension fund manager shared this with me in regards to Mark Wiseman's appointment:
I am not sure what to make of it. Personally I don't think it is a good idea that someone so soon removed as a CEO at one pension plan should be Chairman at another pension plan as they may try to impose too much of their own way of doing this - for example, Mark pushing AIMCo to adopt things that CPPIB had done. But others may have a different point of view on that.I thank him for his insights and he raises good points.
I am also not so sure why Mark would want to take this position as in discussions with Leo de Bever it seems that there are major governance issues with having so many clients, and some of these clients are obviously unhappy to be forced to use AIMCo as an asset manager. And there have been more hints of government interference at AIMCo in the past, and some of Jason Kenney's biases seem to indicate that he is willing to more directly try to influence AIMCo. For example, supporting oil and gas companies. In my opinion AIMCo should invest zero in oil and gas since that is putting all of the eggs in one basket when you account for where the Alberta government gets its revenue.
The other interesting area is that Mark appeared to feel strongly about is ESG and sustainability and that is not something that the UCP or Jason Kenney are interested in, at least when it comes to oil and gas and coal. The final issue is that Mark is not from Alberta.