Report from
the CEO

Hi. I'm Raff Arndt and I'm the CEO of the Future Fund Management Agency. 

When I think about my reflections of the last year it was a very busy year and there was quite a lot of change actually, starting with we had a pretty new Chair. He’d been in the seat about a month before the beginning of the year.

We had such an important and busy year in terms of our three-year business plan. To get ready for that we made some changes in our Senior Executive Team. So, we've got a new General Counsel this year. We've got a new Head of People, Culture and Inclusion and we've got a new CFO and Chief Risk Officer. And so those new people join the existing team and we’ve got a great mix of people who've been here for a while, who've been promoted, fresh eyes and ideas and people who've been around. And together we're going to come together, keep innovating but also challenge each other and make sure that we're making the best decisions going forward.

We had a very strong year, well over 12% return that added over $27 billion to the Future Fund. We made over $1 billion available for distribution across the other funds and that's making a real contribution to the Government's balance sheet in the future of the country.

So in November the Government changed the Investment Mandate to introduce three national priority areas that the Board should have regard to. They are strengthening Australia's critical infrastructure, assisting the net zero transformation of the economy and assisting with the building out of Australian residential housing. And actually the clarity that that gives us, combined with the decision to defer drawdowns to 2032–33 allows us to invest in our resources to apply more attention to these areas. We're already investing in most of them but we can now go deeper, look further and find better opportunities.

For example, during the year we've hired a new person responsible for energy transition and we're going to have a dedicated team looking at that. We've done some deep research in residential housing here in Australia and we've got a new strategy in place. We already have been investing in student housing and in certain parts of the aged care sector but we've got some ideas around the rest of residential housing and we've also got some insights into what is and isn't working that we've been able to pass back to the Government. And on the infrastructure side of course, we've got a lot of capital at work. There's a lot of CapEx investment requirements across the airports, the energy companies, the data centres and so we just continue to do that really well.

There are plenty of challenges ahead for the investment industry and of course for the Future Fund. As we've kept on saying the world is changing, we're not through all of that change yet. In fact, in many ways we're still towards the beginning. If you look back at previous periods of disruption in history and we're doing our very best to get ready for that new world. We expect more inflation, changing societal attitudes, perhaps different rules around trade, capital flows and the like. And so, we're trying to be really open-eyed and ready for those type of changes and invest that way. That flows through to our organisation, we needed a culture and a governance model that allows us to adapt to change but we're also spending a lot of time talking to other participants in our industry. Both to learn from them and their views but also to share our insights with them.

There's so many challenges in the investment world. Again we delivered strong returns but when I think about why that was, it was because we had a team that was focused on understanding the changes in the world and adapting to them and a whole organisation that supported that change with its culture, with the technology we delivered, with all the other enabling ways that we support our investment activity.

And to see the team come together, work together and deliver all the things we did, just makes me very proud.