Canada's second-largest pension fund, Caisse de depot et placement du Quebec (CDPQ), on Wednesday said former investment banker Charles Émond will become chief executive, taking over as it navigates an uncertain global economy and some challenging investments.
Émond, who will replace Michael Sabia on Feb. 1, follows a leader who navigated through the financial crisis, when Caisse had billions in losses, reducing its exposure to risky assets and returning it to firmer footing. Annualized returns have been 9.9% over the past decade.
"How do you follow Sabia's track record, which is excellent?" said Karl Moore, a management professor at McGill University.
Émond will have to contend with some challenging holdings, including a C$6.3 billion ($4.79 billion) light-rail rapid transit system in Montreal facing delays and cost overruns; the troubled SNC-Lavalin Group, of which Caisse is the biggest shareholder; and Bombardier, whose transportation division is facing performance problems with its contracts in New York and Switzerland.
He will also have to navigate an uncertain world economy, the ongoing coronavirus challenge and its fallout, and, with several investments in the U.K., Brexit, Moore said.
"He's an insider at the senior level but with a lot of relevant outside experience..." Moore added. "I think we'll see a continuation of their existing strategies."
Émond, at Caisse since February 2019, has served as the pension fund's executive vice-president for Quebec and private equity and strategic planning since November, overseeing the fund's portfolio in its home province as well as global private equity investments.
He was at Bank of Nova Scotia for nearly 20 years, most recently as its global head of investment banking and capital markets and head of Canadian corporate banking. He led Scotia Capital's Quebec activities, as well as overseeing teams around the world, Caisse said in a statement.
CDPQ, which held C$326.7 billion of assets as of June, said in November that Sabia, who had been the pension fund's first non-Francophone CEO for 11 years, would leave in February, earlier than planned. The University of Toronto said he would become the director of its Munk School of Global Affairs & Public Policy.
