PROFILE: Editorials: Edition: July / September 2019

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Same dedication, another direction

The past few years have been tumultuous but ground-breaking

for 37-year old John Oliphant. He reflects on them.

TT: As principal executive officer of the Government Employees Pension Fund, to which you were appointed before age 30, you achieved significant impact particularly by having championed such public causes as stakeholder activism and the Code for Responsible Investing in SA. Is this a world you’ve abandoned?

Oliphant: I’m still actively involved with CRISA as its committee chairman. The main focus for CRISA has been internal, strengthening its governance structures and trying to improve its funding. My belief is that the CRISA initiative should be led by the asset owners such as pension funds. Hopefully, once this situation is reviewed, I’ll be able to step back for asset owners to take the lead. The GEPF, the largest asset owner, had helped to start CRISA. Since then, however, most signatories are asset managers.

Are you happy with CRISA’s acceptance and implementation by the retirement-fund industry? If more must be done, then by whom?

The preamble to Regulation 28 states: “Prudent investing should give appropriate consideration to any factor which may materially affect the sustainable long-term performance of a fund’s assets, including factors of an environmental, social and governance character.” This consideration has laid the foundation for responsible investment within the pension-fund regulatory framework.

Because what gets measured gets done, the Financial Sector Conduct Authority should consider requiring pension funds to submit reports on their active-ownership records; for example, as complementary to their investment policy statements, on their proxy-voting policies and implementation of these policies.

Perhaps the FSCA could also develop templates for funds to report in a cost-effective way on ownership responsibilities. Most pension funds, through investment mandates or agreements, have delegated these ownership responsibilities to their asset managers. It should be for the funds appropriately to monitor and report on this delegated responsibility themselves.

Since leaving the GEPF five years ago, you’ve launched a new business. What is it and what does it do? How does it relate to your previous experience?

I started an investment holding company. Called the Thirdway Investment Group (TWIG), it is aimed at making investments in asset-management businesses. The focus is on responsible and high-impact investing. We partner with entrepreneurs who share visions and values similar to my own.

Such as what?

Having been instrumental in getting responsible-investment policies into the mainstream, and creating developmental-investment policy frameworks in SA, I wanted to build a business that allowed me to express this passion. I could not achieve my broader vision without sustainable partnerships. So far we’ve built or repositioned:

• Third Way Investment Partners, a fund-of-funds investment platform. TWIP launched its flagship infrastructure debt fund, under founding partner Fulu Makwetla, with total commitments of R2,5bn. It assists smaller pension funds cost-effectively to gain exposure to infrastructure investments that have high social and economic impacts;

• Then we created RHBophelo, launched in 2017 as a public company, with founding partner RH Managers. We seek to play a transformative role by making healthcare affordable to the majority of South Africans while generating sustainable returns for our investors. This is still a fledgling entity. I’m the non-executive chair and RH serves as management;

• All Weather Capital is an emerging asset manager. As the holding entity we had an opportunity to buy into All Weather and to reposition it in line with our philosophy of responsible investing. I’m the executive chairman and founding partner Shane Watkins is chief investment officer;

• Boxwood Property Fund, emerging and unlisted, initially focuses on high-impact redevelopments in Cape Town’s inner city. We founded the business with experienced commercial property manager Rob Kane;

• South Point provides quality, affordable accommodation for students. I chair the investment committee. We intend to create opportunities for pension funds to invest alongside us in student accommodation.

Are you the sole TWIG shareholder or are there other investors?

Through family trusts, I’m the sole shareholder. Underlying investments and boutiques are co-owned with their founding partners.

During the five years that TWIG has been operative, by what measures would you say that the business has grown? How did you identify the opportunity for it and why did you call it Third Way?

I see myself as an accidental entrepreneur. My GEPF exit was not well managed and made it difficult for me to find a job, so I was forced into the route of entrepreneurship.

My contentious exit, where I and then GEPF chairman Arthur Moloto couldn’t find middle ground, proved a major lesson in leadership. When we reflect on it today, as friends, we both recognise this. It was his way or my way, not a third way. My company’s name is a constant reminder always to consider different angles and options in making decisions.

During your protracted scrap with the GEPF, how did you mainly use your time?

I attained an MSc in finance from London University.

Can you describe your business philosophy?

It’s anchored on partnerships. My strength is mostly big-picture but I fall short on detail. The partnerships combine vision with implementation capability. It’s virtually impossible to succeed alone.

Your biggest disappointments?

One was a JSE-listed entity that I helped create but had to leave. Another was losing a founding partner to an established listed company.

You’ve been something of a role model for younger blacks wanting to climb the ladder in asset management and related fields. Some advice for them?

There are no substitutes for hard work, passion and dedication.

In a tight marketplace, is the financial sector able to offer sufficient career opportunities? Any ideas how industry ‘transformation’ might be accelerated?

We need to see more young black investment professionals. They’d be advantaged by completing studies in problem-solving type courses such as accountancy, actuarial science, maths and engineering.

Also crucial is reaching out to players in the sector for mentorships. The student chapter at the Association of Black Securities & Investment Professionals could play an increasingly important role and we must ensure its continuous success. ν

Oliphant . . . pastures new