Stefano Pighini recently left Italian energy giant Ente Nazionale per l’energia Elettrica (Enel) where he had been head of Enel pensions funds from 2002-04.
He was also a finance manager and pension fund board member with responsibility for co-ordinating investment policy between the group’s two pension schemes; the manager and secretary to the board of Fondenel, with AUM of around €150m, and with AUM of over €500m the employee fund, Fopen, where he was the board director and member of the financial committee.
George Coats asked him about his career
What was your first full-time job - and do you remember what you were paid at the time?
My first job was some 30 years ago, with the actuarial accountant Ernst & Young, then known as Arthur Young, in Rome and I was paid the equivalent of €200 per month. After one month’s training I was sent out to companies to check the boardroom journal, make the inventory and check the balance sheet. But it was not simply routine, since I participated in acquisitions audit and the liquidation of companies.
What was the best piece of advice that anyone gave you career-wise and did you take it?
It was given to me when I was finishing my MBA at Columbia University [in the US] and it came from the professor of business policy. Just as I was sitting the last exams he told me that any problem was like a prism and advised that one should not jump to a conclusion until one knew all the facets of the prism. And of course I have taken that advice. It taught me that I should analyse all the issues of a problem before deciding on a course of action.
How did a nice person like you become involved in pensions?
It started in 1998 when I was at Enel and had been assigned to special projects. As a result I was appointed to help with a planned IPO. In the event the IPO was postponed but according to the terms of a new law Enel had already started a pension fund for managers, and I was assigned to develop it as one of the special projects. Since then I have done several other things, including co-ordinating the eventual Enel IPO that occurred one-and-a-half years later, and I remained on the board of the pension plan.
What was the most satisfying achievement during your career - and why?
In the field of the pension funds I was the first in Italy to offer a multi-line of investment. Through this process we offered members the choice of investment options, giving them the ability to design their own pension. For example, they could invest in a bond line, in an equity line or a monetary line. We were the first to implement these new funds.
And what was the worst moment in your career - and why?
In terms of the pension funds, the Enel big fund was the first to be examined by the Italian pension regulator, COVIP. Everything was found to be OK but when, nine months later, the result of the examination was released it said that formally everything was wrong.
This was purely for political reasons. The delay was due to the fact that the examination coincided with a shift in the presidency of the funds from a representative of the company to a representative from the trade union, the fund’s bylaw requiring that they alternate the presidency every three years, and so was not material to the report’s finding.
The report’s conclusion was due rather to the use of a formality, that we were employing certain working methods that had not been formally approved by the board and therefore, not having been formally approved by the board, were non-existent. So it taught me that one’s work had not only to be technical but also political.
How would you sell a career in pensions to a prospective newcomer to the industry?
In the next 10 years more and more money will be put into pension funds and so the sector will experience a boom. It is perhaps indicative that the only increases in expenditure included in the Italian government’s financial programme this year was for pensions. Everything else, ranging from the military to family issues, was cut.
What would you do differently?
Looking back, I would spend a lot more time on fostering political relations.
Do you have any unfulfilled ambitions?
Yes, to work professionally but not for a third party, rather for myself. I want to be self-employed.
Are you retiring or are you recycling yourself into some new role?
I am in the process of recycling myself, and indeed I am considering projects in the areas of renewable energy and the environment. I will know just what exactly I will recycle myself into within the next six months.
Your words of wisdom for those in the pensions industry?
Yes, you have to work for a very long time but you are only judged on the achievements of the last quarter. And you have to find your own way between these two opposites.