The powers that be at PGGM put on a brave face, saying the fund was “proud” Munsters’ next stop would be one of the world’s biggest pension funds, with assets of e150bn.
PGGM spokesman Alfred Kool told IPE then: “Yes, it was a surprise. We see it as a compliment. They looked for the best man, so it says something about our investment policy. What Roderick leaves is a very professional team.”
Kool stressed ABP was not a competitor for PGGM and that the two schemes cooperate in many areas. “We have to begin to think about his succession,” Kool added, saying it was too early to say whether the appointment would be internal or from outside. However, PGGM said in early January, it was in talks with “a number of candidates”, and hoped to present Munsters’ successor at the end of February, during his farewell reception. “We are looking for an investor who is also an inspirational manager, and who fits in with our board,” PGGM said.
At the age of 41, Roderick Munsters’ career has been somewhat of a roller coaster ride. He has been CIO at PGGM since 1997 and was previously at Interpolis. He graduated in Business Economics at the University of Tilburg and took his master’s degree in Finance at TIAS Business School.
Munsters is not only a top investment manager, he is also highly influential on policy issues through his chairmanship of the Dutch pension governance foundation SCGOP, and his seat on the executive committee of the International Corporate Governance Network.
When Munsters joins ABP at the end of February, he will have some pretty big shoes to fill at the civil service fund. He is, after all, succeeding no less a person than Jean Frijns as chairman of ABP Investments. Frijns has been around for a long time, and is highly respected in pensions land. He is leaving the civil service fund to head the government-appointed Corporate Governance Commission, which will monitor the implementation of Holland’s new governance code. This code, also known as ‘Tabaksblat’ was based on a number of SCGOP proposals.
It took ABP six months to find a successor for Frijns, and the fund was suitably pleased when it made the announcement: “We are delighted that we have found a fitting successor to Jean Frijns in Roderick Munsters,” said Elco Brinkman, chairman of ABP’s board of governors. “He is a prominent figure in the world of institutional asset management and is widely respected for his investment savvy.”

In a sense, the choice for Munsters as Frijns’ successor was highly logical. Both men know each other well, having worked closely together on a number of issues, including the acquisition and restructuring of NIB, not always smooth sailing. More recently, they worked together in the aftermath of a multi-million euro accounting scandal at troubled Dutch retailer Ahold.
Following a dramatic fall in its share price, Ahold shocked investors and shoppers when it announced in 2003 it would pay its new chief executive, Anders Moberg, a remuneration package of as much as e10m. The announcement led to investor outrage and a shoppers’ boycott in Ahold stores in the Netherlands.
Both funds made headlines when they wrote a joint open letter to Ahold’s supervisory board chairman. In it, Munsters and Frijns demanded that the retailer amend Moberg’s package, saying Ahold did not “take its shareholders
seriously”.
Two weeks after the letter, Ahold conceded defeat. It announced the departure of the controversial chairman of the group’s supervisory board. Moberg also bowed under pressure from the country’s largest institutional investors by offering to reduce his much-debated pay package.
Oil giant Shell has also felt the pressure from Holland’s biggest institutional investors. Partly as a result of shareholder pressure, Royal Dutch decided to look into, and later amend, the company’s highly complex dual Anglo-Dutch structure following the shock announcement on its reserves.
Munsters has been outspoken on a number of subjects in the past, and no doubt will continue to do so at ABP. For example, when he took over as chairman of the SCGOP, he challenged fund managers and insurers to match the shareholder voting records of pension funds. SCGOP was founded in 1998 by eight Dutch pension funds, including ABP and PGGM.
Accepting the foundation’s chairmanship at Erasmus University in Rotterdam, Munsters said “some institutional shareholders” had neglected the issue of pension fund governance. “Dutch pension_funds have been spending a lot of brain power on the subject and have a certain tradition, although we do lag behind the UK in this respect. Insurance companies and the like are lagging,” he said.
So, it is probably safe to say ABP’s previous dedication to shareholder engagement is in the right hands with Munsters at the helm. Frijns, one of the founding members of SCGOP, in particular has been very outspoken on this subject.
In a joint interview with Munsters with Holland’s Financieele Dagblad in September last year, Frijns said 2005 would be “the year of the truth” for publicly-quoted companies. “The Tabaksblat corporate code enables us to check on companies’ accountability,” he said. Frijns issued a warning for companies lagging behind with the implementation of the code. “From 2005, we will take a good look at who is falling behind. They can expect questions from us during shareholder meetings.”

But do not expect Anglo-American-style shareholder activism – including ‘black lists’ of companies whose corporate governance is not up to scratch – from the funds. “Such a thing does not fit in to Dutch culture, we are not a country of naming and shaming,” Munsters told the newspaper.
Instead, Munsters said he wanted to focus on improving the quality of shareholder meetings. “A number of meetings have not exactly made us very happy. They need to be run more effectively.”
Back to PGGM, where Munsters leaves an impeccable track record. In the last 10 years, of which the last seven Munsters was in charge, PGGM yielded 8.6% on average. No mean feat, particularly compared with the performance of investment funds such as Postbank Aandelenfonds (6.5%) or Rorento (5.8%).
PGGM, one of the first Dutch funds to invest in hedge funds and commodities, is also doing well on the cost side. Over the past decade its management costs came in at 0.3%, compared with 1.1% at investment fund Robeco. But Munsters is the first to admit he has had a certain degree of luck with his investment decisions.
Talking to Holland’s Pensioen Bestuur & Management magazine at the beginning of this year, he said PGGM’s decision to fully hedge its currency exposure in 2000 when the US dollar was trading at 0.92 eurocents turned out to be rather fortunate. Let’s hope for ABP that Munsters’ luck will continue in the future.

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