John Graham tells a podcast that most leaders wait too long to get the right people in place
CPP Investments chief executive John Graham said an aligned senior team is one of the most important things a leader can build, and he admitted he moved too slowly to assemble his own.
Graham shared the lesson with Nicolai Tangen, chief executive of Norges Bank Investment Management (NBIM), on Tangen's podcast In Good Company.
Graham, who has led Canada's largest pension investment manager for more than five years, said most leaders make the same error.
"I think like most people, you end up being too slow," he told Tangen.
New chief executives, he added, should be able to look around the senior table at the one-year mark and see exactly the people they want beside them.
The payoff comes when that team pulls in one direction.
"Having a senior team that is aligned to where you want to go, that is as bought into the vision and the mandate of the organization, will truly act as team one," Graham said on the podcast.
He said he pushes decisions to the people closest to the information across geographies and asset classes, while keeping them aligned to the fund's mandate.
Graham took the top job in February 2021 after Mark Machin resigned, and he now oversees roughly $800bn on behalf of 22m Canadians.
He warned that bureaucracy rebuilds itself unless leaders intervene.
"It just kind of takes on a life of its own, like a little Frankenstein that grows over time and gets fed and becomes unmanageable at some point," Graham said.
Every few years he hits pause to clear it out, he added, because the drift runs only one way.
"You will not naturally de-bureaucratize," he told the podcast.
On strategy, Graham set a clear priority for a fund that carries pension liabilities: protect the downside, even at the cost of some gains.
"We are not always maximizing," he said, according to Top1000funds, describing a pension as something other than a "wealth-maximizing vehicle" and arguing that giving up some upside matters more for the liability stream.
He called diversification "an act of humility."
The fund also rules out some areas outright.
Graham said CPP Investments holds exposure to about 50 countries but stays active in only 12, and it has never invested directly in cryptocurrency.
It avoids blanket divestment, he said, and continues to back oil and gas.
Graham said the fund discloses more than the law requires.
"We have taken an approach to disclose at a level that is even beyond what is required under the CPPIB Act, with a view that Canadians should understand how their money is being invested and the cost base we have," he said.
According to Top1000funds, CPP Investments and NBIM have topped the Top1000funds.com and CEM Benchmarking Global Pension Transparency Benchmark since it began ranking individual funds in 2022, with the Norwegian fund holding the overall lead since 2023.
On private markets, Graham rejected the idea that internal teams and external managers compete.
"I think it's hard to say who does better, because your internal teams are benefiting from the origination and the asset management of the external teams," he said.
He described a hybrid approach in which the fund backs private equity managers it rates highly, then co-invests and co-underwrites alongside them.
Graham said CPP Investments has rolled out large language models to every employee but cannot yet say whether they improve investment decisions, calling the question "TBD."
He rejected any move to stop hiring juniors, saying today's recruits will become the organization's future leaders.
He closed on humility.
"Any investor who says they haven't been humbled is probably either taking a lot of risk or is not being overly truthful," Graham said.
More work rarely rescues a weak deal, he added: "You can't diligence a bad investment into a good investment."
