When Jeff Wendling became president and chief executive officer of the Healthcare of Ontario Pension Plan, Toronto, in April 2020, the COVID-19 pandemic had just turned the whole world upside down. He was forced to take on greater responsibilities, and find a way to work with staff members he could not meet with in person.
“It was a very strange time,” he said. “I became CEO two weeks after our office had to shut down for the pandemic, so I didn’t even go into the office. Technology was a huge savior because we were able to work together very effectively. We didn’t miss a beat.”
The fallout from the pandemic is still extant, he noted, considering that most employees at the pension fund, including the investment staff, still work a hybrid schedule.
Wendling will retire from HOOPP in 2025 after 26 years at the pension fund. A successor has not yet been named.
Starting in 1998 as a senior portfolio manager, he became vice president of public equities in 2003. In 2012, he reached the position of co-chief investment officer, and became the sole CIO in 2018, before securing the top job in 2020.
Over the span of his career – which commenced in the late 1980s – Wendling has witnessed several cataclysmic geopolitical and economic events that dramatically impacted global markets.
“The fall of the Berlin Wall in the late 80s opened up a whole new part of the world that had been really closed off, opening it up to the global capitalist economy,” he said. “The other massive thing was the rise of China and their economy, which is now the second biggest in the world.”
Wendling also witnessed a lot of changes at HOOPP, which serves Ontario's hospital and healthcare-sector workers, during his tenure. For one thing, the pension fund’s asset size has mushroomed to C$112.6 billion ($84.9 billion) at the end of 2023 from approximately C$15 billion in 1998.
Asset Growth, LDI
Another big change has to do with the nature of HOOPP’s assets.
“We are more international now than when I joined,” he said. About 55% of the current portfolio is invested in Canada.
Another major change: most of HOOPP's assets are managed in-house by a team of about 80 investment professionals in Toronto. “The cost of external management can be very high, and as we got larger, we had the resources and the scale to build internal teams. It really just is more cost-effective,” Wendling said.
Wendling also witnessed the emergence of alternative assets over his tenure at HOOPP – the pension fund now has sizable allocations to real estate, private equity and infrastructure.
“There are great opportunities in the private markets but I also think there are great opportunities in the public markets,” he said. “For us, one of the things we are very careful of with the private market is that you have to manage your liquidity well.”
Another major development at HOOPP was the use of lability-driven investing, which Wendling and his predecessor Jim Keohane implemented in 2007.
That strategy – which involves hedging inflation and interest rate risk - led HOOPP to allocate more to bonds, a move that Wendling said played a key role in helping the pension fund to sustain itself during the global financial crisis of 2008-2009.
Wendling's longevity at HOOPP (extending nearly three decades) is “not normal,” especially now when asset management and pension fund firms witness high turnover in the C-suite.
“But the culture and the purpose we have, everybody feels really good about working for the retirement security of healthcare workers,” he said.
As for retirement, Wendling pointed out that will not occur until sometime next year when the board finds a successor.
“The first thing for me will be to step back and take a break, probably do quite a bit of traveling with my wife and my adult children,” he said. “Eventually, I will want to think about how I might re-engage with the industry in some way and help somehow, but that’s down the road.”
HOOPP returned a net 9.38% in 2023, below the benchmark return of 10.36%.
