Ahn Hyo-jun, Director of the National Pension Service Fund Management Headquarters
[Asia Economy Reporter So-yeon Park] Ahn Hyo-jun, Chief Investment Officer (CIO) of the National Pension Service (NPS) Fund Management Headquarters, expressed his determination to secure the independence and efficiency of the Fund Management Headquarters during his remaining term.
Ahn recently told Asia Economy, "I will do my best to create a better working environment for my juniors during the remaining period." Ahn's term will end on October 7, after a total of three years.
Ahn emphasized, "If a good working environment is created for the investment personnel, it will be reflected in the investment results and eventually return to the people. This is not simply about reforming incentives."
This statement by Ahn Hyo-jun is interpreted as his intention to establish an institutional foundation that allows the Fund Management Headquarters' investment personnel to operate the fund independently and confidently, free from external influence, before concluding his term.
Ahn has been recognized as a person with affection and a sense of mission toward the National Pension Service, having applied for the CIO position at the NPS Fund Management Headquarters despite receiving a lower salary than when he was president of a financial holding company.
Having built his asset management career through securities firms such as Seoul Securities, Daewoo Securities, Daiwa Securities, as well as ANZ Bank and Kyobo AXA Asset Management, Ahn was recruited to the NPS in 2010 as an international finance expert.
After serving as head of domestic and overseas equity divisions at the NPS Fund Management Headquarters, he moved to BNK Financial Group in 2017 as the Global Head (President). He was appointed CIO of the NPS Fund Management Headquarters in 2018 and has been serving since.
A senior official at the NPS said, "The most urgent issue within the Fund Management Headquarters is the clear distinction between the roles of CEO and CIO. In principle, management and investment should be separated, but in reality, there have been many difficulties."
The Fund Management Headquarters operates under the direction of the NPS Chairman, the Minister of Health and Welfare, and the Board of Directors. The CIO position is influenced by government input from the appointment process and has a short term of up to three years.
For years, there have been calls inside and outside the NPS for the independent operation of the Fund Management Headquarters. This is based on the need for political independence to allow the headquarters, which manages 870 trillion won of the public’s retirement assets, to establish long-term investment strategies confidently.
Recently, the Korea Financial Research Center proposed in its "Policy Recommendations on the Governance of the National Pension Service" that, in the long term, the Fund Management Committee with expertise and the Fund Oversight Committee with representativeness should be separated. Some suggest filling the 20 fund committee members with private experts and guaranteeing political independence comparable to that of the Bank of Korea’s Monetary Policy Committee members.
A senior official in the financial investment industry said, "The governance discussion of the National Pension Service has been a 'hot potato' that has been pondered for a long time. In fact, it is very delicate because it would be difficult to operate in the domestic capital market if excluded by the NPS and the Ministry of Health and Welfare."
Meanwhile, the National Pension Service recorded an annual return of 9.58% last year.
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