AustralianSuper | accessing global asset management expertise through the UK

AustralianSuper is Australia’s largest pension scheme, helping its members to achieve their best financial position in retirement by delivering robust long term investment returns.

We spoke to Damian Moloney, Head of Investments, International, about the fund’s plans for the future and the benefits of having an office in the UK.

What AustralianSuper does

AustralianSuper is an Australian superannuation (pension) fund headquartered in Melbourne. It manages £147 bn in assets on behalf of its 2.9m members – or roughly one in ten Australian workers. With pension contributions being mandatory in Australia – and increasing – the fund is expected to see considerable growth in the coming years and is already a top 20 pension fund globally.

UK and global operations

Headquartered in Melbourne, AustralianSuper established its European base in London in 2016. Its London office operations have since expanded over time and is rapidly heading towards 100 staff as they build and grow the investment capability of the UK team.

Acting as the hub for its activities in Europe, the role of the London office is to source and oversee private and public markets assets and investments in the UK and Europe, alongside oversighting manager relationships in the region. London is also one of two of AustralianSuper’s capital market hubs, handling around half of the portfolio’s global trading activity.

The main benefits of being based in the UK

When asked about the pull factors that drew AustraliaSuper to set up in London, Mr Moloney highlighted key points of overlap between Australia and the UK that would ensure a smooth set up and ease of ongoing operations – namely language, legal system, and wider cultural commonalities.

AustralianSuper actively invests globally, with more than half of the assets invested offshore. International connectivity and access to financial services talents are crucial to its operations. A London office location offers advantages that suit AustralianSuper’s needs – access to talent, access to investment opportunities, market depth, networks, and liquidity, as well as a strong and highly advanced regulatory environment. Further, London’s wider attractiveness as a destination means that secondees are quite happy to move to London over other locations.

While there was concern that UK financial markets might shrink relative to the EU at the time of setting up in 2016 after the results of the referendum on Brexit, the UK financial services industry has demonstrated its resilience. AustralianSuper is confident that the strengths of London as a location will continue.

The benefits of an on the ground presence in London have certainly been realised – access to talent, increased investment opportunities, and being part of a mature and substantial investment and financial ecosystem.

Mr Moloney also recognised the support AustralianSuper received from both public and private sectors in the UK, “an extra boost to the establishment of our office has been the support and encouragement we have received from Government, the City, and the finance sector here, both in terms of direct advice and assistance, but in also making AustralianSuper and our team feel welcome, valued, and connected. It has been a uniformly positive experience for AustralianSuper, and we appreciate the last six years, and look forward to the next decades in London.”

Future growth plans
As part of its upcoming global expansion plans, AustralianSuper is planning to invest £23bn in the UK and Europe over the next five years.

The fund’s offshore investments already include various major UK assets, including London Kings Cross development, Canada Water in south London and Heathrow Airport among others. Looking ahead, the fund sees continued strong private markets opportunities across real estate (including sustainable real estate), infrastructure (including digital), and private credit in the UK and Europe. The company’s existing UK presence provides ease of access to these opportunities and makes it an attractive market for ongoing investment.