Achieving Investment Excellence

CHAPTER 2Developing Purpose, Mission, Vision, and Goals

Key Take Aways

This chapter focuses on the strategy development process for the pension fund on whose behalf investments are made. Defining a purpose and a mission, as well as explicating the values that matter are instrumental processes in shaping the investments that achieve the mission of the fund. What are the participants' needs, both in the short and the long run? How can the investments fulfil those needs? And if the participants' needs change, can the fund still provide added value, or is there a tendency to keep on going just because the organization exists? Is the mission broader than the purely financial interest of the beneficiaries? Does it include collective or societal goals? Trustees should have shared answers for these questions in the form of a mission statement before they move on to formulating strategic goals and using these to design the investment function.

A board that has taken the time to develop a strategic plan will be able to provide its pension fund and participants with direction and focus. A pension fund that does not have a clearly defined and implemented strategy will find that it is time and time again simply reacting in the face of financial, economic and regulatory developments; the organization will be trying to deal with unanticipated pressures as they arise, and will also be at a ...