Managing director and president of Australia’s Future Fund, Mark Burgess leads a dynamic sovereign wealth fund with A$82.4 billion ($85.1 billion) in assets and a reputation for savvy risk management. Launched in May 2006 with just A$18 billion, Future Fund — which kept most of its assets in cash during the financial crisis — went on to build a highly integrated, risk-weighted portfolio of investments. Under the guidance of founding CIO David Neal, it also broke with SWF tradition by challenging its staff to look beyond their particular areas of expertise and think about risk and return across the total portfolio. The result: an innovative organization known for its flexible investment style and its ability to deploy assets throughout diverse sectors and geographies.

That flexibility drew Burgess, previously CEO of Sydney-based investment firm  Treasury Group (and a former vice chairman and CEO for Europe and the Middle East for Credit Suisse Asset Management in London), to join the fund in 2011. Over the past three years, Future Fund has posted an annualized return of 7.9 percent. Burgess, 50, recently spoke to London Bureau Chief Loch Adamson about the fund’s commitment to long-term investing, the challenge of working to an ambitious absolute-return benchmark and the hazards that remain in still-volatile but slowly recovering global markets.

Future Fund Managing Director Mark Burgess What is your top priority as Future Fund’s chief executive?

I’m focused on the Future Fund’s next phase of evolution, which represents a natural, normal progression for the organization. In our first phase we were just a buyer of assets; now we buy, monitor and sell. Selling is a very different discipline psychologically than buying. In the Future Fund’s first five years, we didn’t sell that many assets; we just went around acquiring things. We’ve sharpened this up now, and we have methods to review and refresh the portfolio because we need to make sure that it’s kept fresh and alive at all times. We don’t want it collecting any barnacles.

How does the investment team source new ideas?

We do our own work. We want to be known as original thinkers — and I feel strongly that for a fund of this size, developing our own view is critical. We don’t rely on consultants. We expect our people to add value and to use our managers to help them do this. Although we do use consultants on occasion for targeted assignments, we’ve made a conscious choice to be accountable for our own investment decisions. Relying on external consultants only clouds the issue of accountability. If we’re going to run a portfolio that is as well diversified as the Future Fund’s, we need to make our own choices. If you are accountable, you will be a better investor.