Wayne Wicker is the Senior VP and CIO of ICMA Retirement Corporation, an asset manager that oversees $50B across more than a million retirement accounts of City and County public sector employees throughout the country. Before joining ICMA-RC in 2004, Wayne had a distinguished career as an allocator and manager, starting as an allocator at the corporate pension fund of Dayton Hudson (now Target Corporation) in the 1980s and the Howard Hughes Medical Institute endowment in the mid-1990s, after which he moved to direct investing in large cap growth equities for seven years at Cadence Capital Management in 1998.
Our conversation covers Wayne’s career path, multi-asset investing, and the ins and outs of managing defined contribution plans as a fiduciary and as a business. We discuss asset allocation strategies, regulatory limitations, stable value products, retirement shortfall risks, active vs. passive on large pools of capital, and managing internal and external teams.
This episode took place at a recent Institutional Investor conference for Corporate Funds and Insurance Portfolios, with the core discussion about ICMA-RC occurring in front of a live audience.
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Show Notes
2:01 – How Wayne first got into the investment business
3:58 – What he did after getting his MBA
7:25 – How he learned about the pension business as a staff of one
9:18 – Key investment lessons from his early career
11:08 – Decision to move on from Target/Dayton Hudson
12:44 – Key differences between overseeing a corporate pension vs a hospital endowment structure
14:25 – How much did the difference in the investing strategy come from the mission of the funds vs the boards overseeing them
15:50 – What could Wayne do on the margin at Howard Hughes
17:28 – Transition to CIO
22:40 – Live Show Begins
23:00 – Defining ICMA-RC
23:32 – How does Wayne think about setting investment objectives with such a diverse group of clients
25:02 – Is it frustrating to have a more finite universe of investing options compared to previous work at Howard Hughes and Dayton Hudson
26:08 – Views on active vs passive
27:50 – The manager selection process
28:49 – Managing risks with external managers vs an internal team
30:34 – How does the team at ICMA-RC put their best ideas forward without governance getting in the way
31:34 – What constraints are imposed on investment decisions by the various regulatory bodies that ICMA-RC faces
32:40 – Their outlook on the market
34:08 – How does ICMA-RC’s constituents respond to market performance
35:32 – Closer examination using 2008 stock performance
36:23 – How does Wayne educate investors
38:00 – Next steps for ICMA-RC
38:51 – Most challenging aspect of Wayne’s work life
39:41 – Is there a looming pension crisis
40:53 – How do the Financial Planners help the employees if things don’t work out
42:10 – How do they think about financial planning for clients when there’s a chance defined benefit plans could come up short in the future
45:06 – How does Wayne address manager selection differently today given some of the constraints that he faces
47:19 – What has led Wayne to want to exit manager relationships
49:46 – Is there a point where Wayne would decide the optimal strategy is to go passive
51:28 – How does Wayne think about technology and the way it will be disrupt the industry
52:58 – Balancing the internal/external dynamic when hiring people
54:30 – Wayne’s greatest success and failure over the last 14 years
55:50 – Where will the move into emerging markets come from
56:27 – What does Wayne think of the new products that can help younger constituents meet their retirement objectives
57:41 – Live Show Ends/Closing questions