Shaun Manuell, recently appointed Chief Investment Officer at AustralianSuper, faces the significant task of rectifying underperformance in the super fund’s substantial real assets portfolio. AustralianSuper, which manages $430 billion in savings for one in seven Australian workers, saw Manuell promoted after his remarkable success leading its Australian equities team. Under his previous stewardship, the $100 billion Australian stocks portfolio delivered returns 2.6 percentage points above the S&P/ASX 300 index, generating an estimated $8 billion in value. This impressive track record earned him the top investment role.
However, Manuell has shifted his focus from public market triumphs to considerable challenges within the private market. The fund’s $70 billion real asset allocation, primarily in property and infrastructure, has significantly lagged, returning an estimated 5 per cent a year below its benchmark for the past five years. This underperformance has been exacerbated by several poor investments, including a substantial write-down in a $2.5 billion European data centre venture, Vantage EMEA, and issues with North American clean energy investments like Pine Gate Renewables. These setbacks have reportedly negated much of the value Manuell’s equities team previously created, impacting AustralianSuper’s overall fund-level returns.
The contrasting fortunes of AustralianSuper’s internalised investment units — successful in Australian equities but struggling in real assets — highlight critical questions about the fund’s internalisation strategy. Manuell has indicated a need to “reset and reconsider” this approach, stating the fund is now “agnostic” about who manages its assets. The new strategy for offshore capital deployment will increasingly rely on partnerships with large investment firms rather than direct investments. Compounding these investment challenges are internal staffing and culture issues, with recent survey results revealing low confidence among team members in openly sharing opinions or engaging in honest two-way conversations, adding another layer of complexity to Manuell’s turnaround efforts.
