PSP's CIO Eduard van Gelderen Set to Depart After Six Years
Public Sector Pension Investment Board chief investment officer Eduard van Gelderen is leaving the $265-billion fund after six years in the job.
PSP said Wednesday that it has “mutually agreed” with Mr. van Gelderen on his departure, which takes effect on Oct. 1. He will give up his day-to-day duties immediately, and the pension fund has named Alexandre Roy, a senior managing director in charge of total fund management, as interim CIO.
Mr. van Gelderen joined PSP as CIO in 2018, coming from the University of California, where he was a senior managing director in the CIO’s office. The Dutch-educated executive also held senior roles at APG Asset Management and at ING Investment Management.
PSP also announced internally on Wednesday that Patrick Samson, global head of real assets investments, will be leaving on Jan. 1. He will continue in his role until then, and a successor has not yet been announced.
Earlier this month, PSP announced that chief financial and risk officer Jean-François Bureau will retire on Dec. 31, then stay on for three months as a senior adviser to the CEO.
“PSP is proud of the remarkable progress we have achieved, notably navigating complex markets and delivering strong results for our beneficiaries. In order to continue our remarkable journey, we are embarking on the next phase of our evolution,” said chief executive officer Deborah Orida in an e-mailed statement.
“We are confident in the depth of our talent throughout the organization as we evolve and adapt to best serve our beneficiaries,” she added.
The latest departures are among the most significant changes to PSP’s senior management team since Ms. Orida took over as chief executive officer in 2022. She has spent much of the past year crafting a three-year plan that aims to sharpen PSP’s investment focus, emphasizing a disciplined approach in markets that she expects will be volatile.
Four of Canada’s seven largest pension funds have now changed CIOs since the start of 2023, after new appointments at Ontario Teachers’ Pension Plan, Ontario Municipal Employees Retirement System (OMERS) and Alberta Investment Management Corp. (AIMCo).
Over Mr. van Gelderen’s tenure, PSP beat the internal benchmark it uses to measure its investment performance: Its average annual return over the past five years was 7.9 per cent, compared with a benchmark gain of 5.3 per cent.
PSP, which manages pensions for the federal public service, the Canadian Armed Forces and the RCMP, earned a 7.2-per-cent return on its investments in the fiscal year that ended March 31.
In a June statement accompanying the release of those results, Mr. van Gelderen highlighted the fund’s positive returns “against a backdrop of the volatility of the last few years dominated by geopolitical uncertainty, inflation and rising interest rates.”
Last year, PSP also expanded its mandate after Ottawa chose it to manage the $15-billion Canada Growth Fund as a tool to attract a larger share of private capital being invested in the global clean economy.
Early in 2023, the pension fund’s global head of credit and private equity investments, David Scudellari, left to be the head of international investment at Edmonton-based AIMCo, and to build its credit business from a New York office.
Matt Toledo of aiCIO also reports PSP Investments CIO van Gelderen set to depart:
Eduard van Gelderen, senior vice president and CIO of the Public Sector Pension Investment Board, will depart the fund after six years, the Canadian pension fund announced Wednesday.
van Gelderen’s official departure from PSP Investments will come on October 1, although he will step aside immediately from his day-to-day duties.In the interim, Alexandre Roy, the senior managing director of PSP’s total fund management team, will take over van Gelderen’s responsibilities at the C$264.9 billion ($194.78 billion) pension fund.
In a letter to colleagues seen by CIO, van Gelderen told PSP staff that over the next few weeks he would be supporting his wife with a newborn child, as well as finishing his PhD thesis.Van Gelderen joined PSP Investments in 2018. Previously, he was a senior managing director at the University of California’s investment office between 2017 and 2018. From 2014 to 2017, he was CEO of APG Asset Management, the asset management arm of Dutch pension fund ABP. He was previously CIO of capital markets at APG.
Van Gelderen is also chair of the Alternative Investment Management Association’s Global Investor Board. He was a member of CIO’s Power 100 List in 2016.
“I want to express my sincere gratitude to Eduard for his significant contributions to PSP over the years,” said Deborah K. Orida, president and CEO of PSP Investments, in a statement. “Eduard’s commitment to building diverse and inclusive teams has made us a stronger organization. His sponsorship and support of PSP’s anti-racism, culture, and religion affinity group will leave a lasting legacy. His contributions have been instrumental in our growth, and we wish him the very best in his future endeavors.”
PSP Investments, one of the largest pension funds in Canada, manages the investments for federal public service employees in Canada, as well as members of the Canadian armed forces, the Royal Canadian Mounted Police and the Reserve Force. The fund has one- and five-year net annualized returns of 7.2% and 7.9%, respectively.
The fund has seen other recent high-profile departures. Earlier this month, Jean-François Bureau, chief financial and risk officer at PSP Investments, announced his retirement from the fund, effective December 31.
And Freschia Gonzales of Benefits and Pensions Monitor also reports PSP Investments' CIO to depart after six years:
Eduard van Gelderen will leave the Public Sector Pension Investment Board (PSP Investments) on October 1, after serving six years as senior vice president and chief investment officer.
With van Gelderen's departure, Alexandre Roy, senior managing director of Total Fund Management, will immediately assume the responsibilities of the CIO Office on an interim basis.
Deborah Orida, president, and chief executive officer of PSP Investments expressed gratitude for van Gelderen’s significant impact.
She highlighted his dedication to fostering diverse and inclusive teams, which strengthened the organization. His active support for PSP's Anti-racism, culture, and religion affinity group will leave a lasting legacy.
Orida noted, “His contributions have been instrumental in our growth, and we wish him the very best in his future endeavours.”
Van Gelderen, who joined PSP Investments in 2018, oversaw the total fund portfolio and long-term investment strategy. He also led the organization’s sustainable investment, public policy, global government affairs, and strategic communications efforts.
Although van Gelderen will step away from daily operations, the decision for his departure was mutually agreed upon.
On Wednesday, PSP issued a press release to announce the CIO's departure:
Montréal, Québec (August 21, 2024) – The Public Sector Pension Investment Board (PSP Investments) today announced that after six years as Senior Vice President and Chief Investment Officer, it has been mutually agreed that Eduard van Gelderen, will leave the organization on October 1, 2024, but will be stepping away from day-to-day operations.
“I want to express my sincere gratitude to Eduard for his significant contributions to PSP over the years,” said Deborah K. Orida, President and Chief Executive Officer, PSP Investments. “Eduard’s commitment to building diverse and inclusive teams has made us a stronger organization. His sponsorship and support of PSP’s Anti-racism, culture, and religion affinity group will leave a lasting legacy. His contributions have been instrumental in our growth, and we wish him the very best in his future endeavors.”
Eduard joined PSP Investments in 2018 and was responsible for PSP Investments total fund portfolio and long-term investment strategy. He also headed the sustainable investment, public policy, global government affairs, and strategic communications functions of PSP Investments.
Effective immediately, Alexandre Roy, Senior Managing Director, Total Fund Management, will take on the CIO Office responsibilities on an interim basis.
About PSP Investments
The Public Sector Pension Investment Board (PSP Investments) is one of Canada’s largest pension investors with $264.9 billion of net assets under management as of March 31, 2024. It manages a diversified global portfolio composed of investments in capital markets, private equity, real estate, infrastructure, natural resources, and credit investments. Established in 1999, PSP Investments manages and invests amounts transferred to it by the Government of Canada for the pension plans of the federal public service, the Canadian Forces, the Royal Canadian Mounted Police and the Reserve Force. Headquartered in Ottawa, PSP Investments has its principal business office in Montréal and offices in New York, London and Hong Kong. For more information, visit investpsp.com or follow us on LinkedIn.
And earlier this month, PSP announced their Chief Financial and Risk Officer plans to retire:
Montréal, Québec (August 7, 2024) – The Public Sector Pension Investment Board (PSP Investments) today announced that Senior Vice President and Chief Financial and Risk Officer, Jean-François Bureau, has announced his intention to retire. Mr. Bureau will remain Chief Financial and Risk Officer of PSP Investments until December 31, 2024. From January 1 until March 31, 2025, he will act as Senior Advisor to the President and CEO and continue to serve as Chief Financial Officer of Canada Growth Fund Investment Management Inc. (CGFIM) until the approval of the financial statements for the Canada Growth Fund Inc. for its fiscal year ending December 31, 2024. PSP Investments will announce details on succession ahead of Mr. Bureau’s departure to allow for a seamless transition of reporting activities.
“I wish to express our gratitude to Jean-François for his tireless commitment to PSP Investments’ success over the last 14 years,” said Deborah K. Orida, President and Chief Executive Officer, PSP Investments. “Jean-François can take pride in his contribution to PSP’s delivery of our important mandate as demonstrated by our track record of stability and strong risk-adjusted returns over the long term. PSP’s 10-year net annualized return of 8.3% has outperformed our Reference Portfolio over the last five and 10 years. Jean-François has been a tremendous asset to our Executive Committee, and a key leader of our financial and risk teams.”
Jean-François joined PSP Investments in 2010 as Chief Risk Officer and took on the added responsibility of Chief Financial Officer in 2020. In addition, Jean-François has also been involved with the CFA Institute and has served as the Chair of its Standards of Practice Council.
"I’m very proud of the contributions that my team and I have made during my time at PSP Investments. PSP is in a position of financial strength with a talented team ready to take our organization to the next level,” said Mr. Bureau. “After nearly four decades in the financial industry, I'm looking forward to spending more time with family and pursuing new passion projects.”
Never a dull moment at Canada's Maple 8, that's for sure!!
Before I give you my thoughts, please remember to visit Institutional Investor's website here and use this link to vote for Eduard van Gelderen as CIO of the year.
The deadline is today so please take a moment to cast your vote.
Alright, let me get to PSP and what seems to be a major reorganization going on there, not just at the senior management level but at other levels too.
First, my thoughts on Eduard van Gelderen.
I've met Eduard twice -- once at McGill where he discussed the Canadian model with Barb Zvan and Sebastien Betermier and once for lunch -- and I can tell you he's extremely nice and polished and an outstanding leader who possesses a high IQ and a high EQ.
It's extremely rare for leaders to have both but Eduard has this which is why he excelled at PSP and progressively took on more responsibilities there.
He's someone who thinks strategically and has a very good understanding of macroeconomic, financial and political underpinnings and it comes across when you speak with him.
But above that, he also understands the importance of setting the right culture which is what he did at PSP and unified all the teams to make sure information was flowing freely and that they were capitalizing on opportunities across and in between asset classes (complementary portfolio which his group was in charge of).
He is diplomatic but not scared to express his opinions bluntly and I personally like that (whether at work or on LinkedIn where he has been active defending Israel and calling out antisemitism).
In short, I don't know the man very well but he left a very good impression on me and he's European mindset is one I can identify with and appreciate.
For far too many people at the Maple 8, especially in senior roles, it's all about titles and money, that's literally all they care about.
Not Eduard, he relishes on thinking strategically, getting the right culture, delivering outstanding long-term results and imparting his knowledge on pensions with colleagues, peers and members.
I am saddened to see him leave PSP and did reach out to him earlier where he shared this with me:
Although I wanted to finish my professional career at PSP, you need an alignment of mindset to make it work. Clearly, that was no longer the case. I am grateful that Neil hired me and we've done a lot of great things; all in the best interest of PSP and its beneficiaries. I am leaving PSP with my head up high.It has been a remarkable six years and I am very proud of the results and the achievements over that period. Many of you were part and/or contributed to this journey: a big thank you!The next few weeks I will be supporting my wife with our newborn and finally finish my PhD thesis with the title "The impact of artificial intelligence on the Canadian model". We'll see what comes after.
Yes, like me, he has a newborn to take care of and his is younger than mine and I remember all too well the craziness of the first three to six months (gets better after six month mark, once they start eating and sleeping longer; nothing prepares you for those first three months, but this is Eduard's fourth child I believe so they know the ropes).
Anyway, in that diplomatic reply, Eduard is telling us there was no longer "alignment of mindset,” and once that happens, it's very hard to stay on in a senior role because senior executives have to share strategic alignment.
I'll share something else with you, when PSP was looking to replace Neil Cunningham, both Eduard who was formerly CEO at APG and Michelle Ostermann were in the running for the CEO position as internal candidates.
It didn't work out for either of them but Eduard stayed on as CIO and had 100% backing from PSP's board of directors who thought and still think very highly of him (as does Deb Orida which she expressed in the press release).
Ms. Ostermann left PSP in 2023 and earlier this year, was appointed CEO of the UK's Pension Protection Fund.
I hardly knew her but a few people told me she was "way out of her league" as Head of Capital Markets at PSP. Perhaps being CEO of the PPF suits her better.
With Eduard, there's no question he's more than highly qualified to be CIO at PSP but if he sees a different vision for the organization than his boss, well, it's only a matter of time before he departs.
More worrisome is the departure of Jean-François Bureau, the CFO and CRO who was there 14 years and Patrick Samson, Head of Real Assets who has been at PSP almost 20 years (arrived in 2006).
That's a lot of experience leaving the organization at a time when they’ll need experience as we enter a global economic slowdown.
Along with Eduard, both men are still featured on PSP's website as part of the senior management but they are leaving soon.
Now, don't get me wrong, unlike yours truly who got the royal shaft after being wrongfully dismissed from PSP back in October 2006 (in hindsight, it was the best thing that ever happened to me), all these senior executives will be very well taken care of and will never need to work ever again unless they want to.
But when you see senior executives with a lot of experience leaving and learn that a number of managing directors with tons of experience have also left the organization, it's natural to ask what hell is going on at PSP.
I can tell you that's what the public sector unions who represent PSP members were asking me in emails earlier today and I understand their concern.
[Note: Unions have fought for and will soon get two seats on PSP's board of directors.]
It's natural after an executive shakeup and reorganization that members ask a lot of questions but let me be crystal clear: this isn't necessarily a bad thing (only time will tell) and no matter what, PSP will survive this senior executive shakeup and reorganization as it has done plenty of times in the past.
PSP has excellent bench strength and Deb Orida is undoubtedly already working on replacing these three senior executives. I wouldn't be surprised if she has already found her candidates (she will choose capable men and women and I'm betting more women to fill these positions to introduce more gender diversity on the senior executive team).
I've seen so many executives come and go at the Maple 8, it's all part of the industry, which is why at the senior executive level, their compensation and severance packages are very hefty (at lower levels, you're given the standard by law after signing an NDA but it's peanuts, nowhere near the level of a senior executive).
Why do senior management shakeups occur? Only the CEOs really know but they are the people in charge and the buck ultimately stops with them so they need to have leeway when undertaking these decisions (not easy by any stretch).
Alright, let me wrap this up and once again remind all of you to visit Institutional Investor's website here and use this link to vote for Eduard van Gelderen as CIO of the year.
If you have anything to add, feel free to reach out to me at LKolivakis@gmail.com.
Lastly, make sure you visit PSP's news hub here and read more news like the sale of Budapest airport here and more like the appointment of Maryse Bertrand as the new Chair of the Board of Directors of PSP Investments (read more here).
Below, a discussion that took place in November 2021 on "Designing Sustainable Retirement Systems in the Current Environment of Ultra-Low Yields" between Eduard van Gelderen, Barb Zvan and Sebastien Betermier at McGill University. You can see me wearing a mask at the beginning of the video but I'm pretty sure I took it off soon after it commenced (and yes, took a selfie with the mask, lol).
To Eduard's credit, he correctly foresaw back then that rates would normalize over the next couple of years.
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