We spoke to Keri Pratt, an Independent Member of our Investment Committee to understand her perspective on strong governance:
At its core, what do you believe strong governance is?
For me, strong governance is as simple and powerful as the right people doing the right things for the right reasons (I am sure I am not the first person to use the phrase). It requires consideration of the needs of all key stakeholders and goes beyond legal and regulatory box ticking. It should embrace different perspectives and promotes transparency, efficiency, responsiveness and accountability.
You really value diversity of thought, not just age and gender. Can you expand on this?
This is my third year on the Investment Committee for CWSF. Over that time, I have come to appreciate the diversity of thought (and age and gender) amongst the committee members. The emphasis and lead from Talal and our Chair, Nick Whitlam, has always been respect for different perspectives and experience. Sometimes this means plenty of questions and much discussion as each Committee member satisfies themselves on all the facts from their perspective. Of course, the Committee’s common focus continues to be on delivering quality outcomes for members in line with Islamic investing principles.
How did COVID-19 impact the way the Investment Committee maintained strong governance and oversight?
COVID-19 has been a game-changer for all of us: forcing us all to find new ways to work and for some of us, robbing us of an income entirely. The Crescent Wealth Investment team needed to quickly pivot to deal with increased volatility in investment markets, and then the requirement to maintain additional liquidity in the Fund to meet redemption requests from members under the Government’s Superannuation Early Release Scheme.
The Investment Committee normally meets quarterly in person. As for many others, the Committee now meets virtually. Over this period of extreme volatility, a number of informal conversations took place with the Investment team, as Committee members shared their experience and insights.
In my view, strong governance provided the support framework the Investment team needed to navigate through a more challenging than usual period and emerge relatively unscathed. And as always, decisions are made with a long-term outlook.
Ethical investment principals are central to Crescent Wealth’s investment strategy. How do you balance investing for both ethical and financial performance?
Crescent Wealth has a set of well-articulated investment beliefs & ethical investment principles within which the Investment team operates when investing members’ money. It is certainly true to say that this assists in facilitating a common understanding of what member expectations are from the outset.
Whenever the Committee is discussing a potential addition or change to the investment portfolio or managers, the conversation always is able to draw on that ethical framework, along with other market and portfolio considerations. CWSF has been the first investor in a number of investment strategies in Australia that are customised based on Islamic investing principles, and it’s exciting to see these strategies play a part in delivering future retirement outcomes for members.
For example, this year we introduced Sukuk investments or Islamic bonds. The driver was to diversify the fund’s exposure to defensive assets classes. The Committee has driven the search for compliant assets – and works hand in hand with the investment team to execute. The roll-out of this asset was a significant milestone for the fund and a great step in both innovation and building long term foundations for the growth and success of the fund.
Even though my involvement with the organisation is primarily through the Investment Committee, my sense is that this applies across all aspects of the business – care for customer is at the centre in decision-making.
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Talal currently serves as a Non-Executive Director on the Whitlam Institute and Western Sydney University Foundation Council Board. He also serves as Chairman of First Quay Capital and Chairman of the Australian Arab Dialogue. Talal has also served on the Australia Post, Board of Sydney Ports, Macquarie University and the Western Sydney Area Health Service and the Chairman of the Department of Foreign Affairs and Trade; Council of Australia Arab Relations. In an executive capacity, Talal spent 10 years at PwC as a director and strategist, and at investment firm Babcock & Brown in the Corporate Finance Group and later in the Technical Real Estate Division. Later Talal held leadership positions in Better Place Australia, Platinum Hearing and Star Transport Australia.