A board that has agreed to replace a chief investment officer in real assets usually has a date in mind. The date is usually wrong by six months or more. That gap says little about how well the search was run. It is what happens when a timetable gets set against the search alone, and four other things are left out of the plan.
Start with the incumbent. Real assets CIOs tend to have long tenures and deep personal relationships with the firm’s capital partners. Those relationships get handed over in person, over several quarters. Then there is the investment committee, which often turns out to have absorbed decisions the CIO no longer makes alone. A board hiring for the job as written discovers the job as practised, and the specification has to be redone. Third is the candidate’s own position. The strongest people here sit mid-way through fund cycles with carried interest attached. Moving them is a negotiation about timing before it is one about money. Fourth is the portfolio. A CIO arriving into assets bought in a different rate environment will ask for a mandate to reposition. A board that has not settled that question in advance will settle it in the final stage, with a candidate waiting.
One decision shortens all of this, and it comes before the search begins. A board that settles what the next five years are for can then say which of the incumbent’s responsibilities the successor inherits. That turns three of those four problems into questions with answers. It also changes who the right candidates are, which is why we would sooner run that conversation than a longlist. The successions we have seen run to time were not faster searches. They started later, after the firm had done the work of deciding what it was hiring somebody to do.
What the full report contains
The full report sets out patterns from recent transitions across the sector. It shows how the specification changed between a board’s first draft and the appointment, and which handover structures worked. It ends with the questions we put to a board before a succession search opens.