To create the returns necessary to fulfill its mission, the Fund has chosen a management model that is divided into two stages. These are reflected in the Fund's organization.
In the first step, The Board of Directors decides on the Fund's long-term investment orientation, the strategic benchmark. The chosen composition of the strategic benchmark is the main driver for the Fund's long-term return. The Portfolio Strategy unit is responsible for providing the Board with decision data regarding changes in the strategic benchmark. This unit does not participate in active management.
In the next stage, the strategic benchmark decisions are executed and active investment decisions are made towards the goal of generating a return on net assets exceeding that for the strategic benchmark. Responsibility for producing this excess return has been delegated to six other investment units, whose task is also to ensure that the Fund's assets are invested in accordance with the chosen strategic benchmark.
The in-house management organization consists of Portfolio Strategy, Global Macro Allocation and Tactical Asset Allocation, as well as management of Swedish and European equities, fixed income assets and foreign exchange. For other investment areas, external managers are used.
The management organization also includes six units for business support and risk management, as well as staff functions for corporate governance, corporate communications and compliance. All performance measurement, risk management and IT activities are carried out by Första AP-fonden's own staff, since these tasks are considered central aspects of the Fund's management.
A service-oriented and high quality IT function is vital for the ability to conduct professional asset management. The Fund has therefore chosen to handle all IT operations with its own personnel.
The Board of Directors establishes the composition of the strategic benchmark and has delegated a risk mandate to the Managing Director for active management. This mandate provides scope for reallocation between and within various asset classes, position-taking in foreign currencies and allocation between internally and externally managed assets. The Managing Director then delegates the risk mandate to the portfolio, managers, both internal and external.
An attractive workplace
The Fund must be able to continuously attract, retain, develop and motivate qualified personnel in order to defend its position as one of the market's top asset managers. In an increasingly competitive market, employee turnover rose markedly in 2006 and 2007 after having been low for many years. To improve the Fund's ability to attract and retain competent staff, the Board has decided as of 2008 to implement a system of variable remuneration payable in a maximum amount of two monthly salaries.
The Fund's ambition is to be perceived as a stimulating and attractive workplace characterized by professionalism, openness, respect, cooperation and decisiveness. In a small organization like Första AP-fonden, the realization of operating objectives relies on the motivation and commitment of all employees. An employee survey is conducted every year, partly to measure these aspects. The results of the survey serve as a basis for discussion with all employees and aid in identifying possible areas for improvement.
Ongoing development and adaptation of the employees' aggregate expertise is of strategic importance for the Fund. The aim of the Första AP-fonden's education policy is to uphold the level of skill needed by the individual employees and the Fund as a whole.
All employees are therefore offered opportunities for development, but are also given responsibility for their own continuing education. Training related to the Fund's financial systems and instruments is carried out on an ongoing basis. Several of the Fund's employees have also participated in more comprehensive educational programs.
An internal leadership training program in which all managers participated was competed in 2007.
|Average number of employees in 2007:||63|
|Total number of employees on 31 Dec. 2007:||64|
|Average age women (years):||47|
|Average age men (years):||43|
|Average term of employment (years):||7.6|
- University degree 72%
- Other 28%
- Women 27%
- Men 73%
Gender distribution in management
- Women 29%
- Men 71%