In the early 90s, years before heading up the only nationally operating super fund for regional Australians, Prime Super CEO Lachlan Baird was fresh out of university and carefully weighing up his career options. Should he utilise his degree in chemical engineering and pursue a career in the mining sector — or would he follow his interest in finance and business and apply the learning from his commerce degree?
With the resources sector suffering a downturn at the time, a career in finance seemed the best route, and Lachlan soon got his break working with KPMG as an auditor of superannuation funds.
A super industry
“I had the maths and science background, but I wanted to get more experience in business, so after completing the engineering degree, I followed up with a commerce degree. My first job was an auditor for KPMG, and I just happened to be the person left carrying the can at KPMG doing superannuation audits back in the early 90s,” says Lachlan. “It opened up the door to a growing industry that interested me.
“Looking back, getting into the mining sector might’ve been pretty great,” he laughs. “But the super industry is fantastic. An engineering degree is always useful to establish a good problem-solving mindset and to consider multiple ways of approaching things, so even though I never practised as an engineer, I still find that training valuable.”
After his time at KPMG, Lachlan moved into a back-office function with Superpartners, overseeing the company’s external accounting function. Following a stint as CFO with Grant Thornton where he flexed his executive muscle, he joined Host Plus, a sport and hospitality super fund, where he served as operations officer and second in command to the CEO, before finally moving to become the boss of Prime Super. “We were originally just a farmer’s fund, but we quickly became a service for all people outside the capital cities. When I came onboard, I wanted to make sure we were focused on where we wanted to be in the long term — a strong, long-term provider of super,” explains Lachlan.
Strategic partnerships
Since first speaking with The CEO Magazine in 2014, Lachlan has also led Prime Super in a strategic merger with HIP Super, a specialist super fund catering to employees of the health sectors. “One of the biggest growth areas, and one of the biggest employers in rural and regional Australia, is health, aged care and community services, so partnering with HIP was a huge marketing and growth opportunity for us.”
The new combined fund now operates under the Prime Super brand, with a health division for members. National Australia Bank (NAB) remains the custodian for the new fund, with administration by Link Super, whom it partnered with in 2014, as well as working with CommInsure after the firm won a tender earlier this year.
“These partnerships have helped us to evolve so we can deliver new and better services and solutions to members well into the future,” says Lachlan. “We’re all working together to deliver a great superannuation product to our members, so it’s important for us to have service providers and partners that have the same mindset as us; we’re all reading from the same book. With this new capability and reach, we’ll continue to provide members and employers with the stability and service that they have come to expect, and we’ll also have the capacity for new and improved member benefits and services.”
New investments
The merger delivered further economies of scale for both businesses through the creation of a fund worth more than $2.4 billion in assets, up from $1.2 billion before the merger. The fund has subsequently grown to have 120,000 members and assets of $3.2 billion, while also receiving contributions from more than 30,000 employers. The strong cashflow generated has led to having to find new places to invest — a nice problem to have. Prime Super works with investment advice partner Whitehelm Capital and continues to further diversify its investment portfolio to deliver long-term and stable returns for members while remaining fluid enough to move with the markets.
While we deliver the right short-term return, we’re also not going to miss out on the benefits of long-term investing. – Lachlan Baird
“We now do a lot of direct investment into alternative avenues like infrastructure, credit facilities, and green projects to diversify away from stock markets. There can be better places to get a good return without all of the volatility.”
Simplifying super
Despite its growth through the merger, Prime Super still maintains a smaller operation capable of investing in smaller-scale opportunities to differentiate from multibillion-dollar megafunds in the industry.
“We have to differentiate ourselves from others in the market, so while we deliver the right short-term return, we’re also not going to miss out on the benefits of long-term investing,” says Lachlan. In addition to removing volatility, Lachlan also strives to eliminate complexity in dealing with members, despite the multifaceted nature of super.
“Super is complex, but if we can do all the heavy lifting and have a straightforward conversation with our members, we’ll get the right outcome in the long run.”
