KWAP Announces Vision To Achieve Gross Fund Size of RM200 Billion by 2025
Kuala Lumpur, 3 August 2022 – YB Senator Tengku Datuk Seri Utama Zafrul bin Tengku Abdul Aziz, Minister of Finance, today launched Kumpulan Wang Persaraan (Diperbadankan)’s [KWAP] TERAS 5.
Embracing a future forward outlook, TERAS 5 is part of KWAP’s long-term view to ensure the right components are in place to support sustainable growth in order to benefit pensioners of today as well as in the future.
TERAS 5 is a three-year programme based on elevating five enablers, namely Structure, Governance, People, Processes and Digital, that will drive eight workstreams including Organisational Structure, Enterprise, Investment, Contribution & Retirement Services, Digital, People & Culture, Corporate Services as well as Risk, Governance and Oversight.
The eight workstreams have been tasked to drive the implementation of 44 initiatives, which include key initiatives on realignment of front, middle and back office, organisational restructuring towards a value chain-based structure and refinement of a Group-wide governance framework.
Among the key improvements targeted via TERAS 5 include a restructuring of the current organisational structure to elevate the strategy, finance and digital functions to allow for a more holistic approach in charting KWAP’s growth plans, moving forward.
The elevated role of these functions is expected to drive the achievement of key deliverables such as the implementation of Customer Experience strategies particularly via digital platforms to improve services to pensioners. As part of TERAS 5, KWAP has embarked on a new data science function under the digital division to enhance service levels to pensioners.
TERAS 5 is also expected to help propel KWAP’s investments across a series of different asset classes, across the globe. KWAP will be able to fully leverage on both macro and micro research more efficiently, in line with the interlinked and global nature of macroeconomics. As a result, KWAP’s robust Strategic Asset Allocation will contribute to stronger and sustainable returns to the Fund.
For an entity like KWAP, the intention with TERAS 5 is to further enhance governance and oversight, where governance is second nature. TERAS 5 is anticipated to make the decision-making process shorter, whilst keeping the governance structure in the form of checks and balances intact.
TERAS 5 will enhance resource planning, focusing on the development of capabilities and skills. KWAP looks to navigate the expectations of new generations of employees entering the workforce through the introduction of culture management, which touches on various aspects including the adoption of digital platforms.
As a consequence of TERAS 5, KWAP aims to cultivate an agile and future-ready talent pool that is innovative, motivated, proactive and customer-centric. KWAP’s talent will be empowered through a more robust risk culture with clear accountability.
TERAS 5 focuses on improving process management and efficiency. By the end of 2024, KWAP looks to have an integrated value driven and agile process management. In terms of improved efficiency, KWAP intends to fully digitalise documentation and automate all key processes.
Digitalisation will be the primary thrust as KWAP looks to become a Digital Native organisation through nurturing citizen developers internally. KWAP aims to leverage further on data analytics to enhance real time dashboards related to investments and pensioners’ data in order to ensure timely investments and optimisation of opportunities as well as to ensure that pensioners’ requirements are met expediently.
TERAS 5 will focus on ease of accessibility and the provision of value-added services. Pensioners will be able to assess their pension related information at the click of a button, thus reducing the need for them to physically make their way to KWAP’s office.
YB Senator Tengku Datuk Seri Utama Zafrul bin Tengku Abdul Aziz, Minister of Finance, said, “KWAP continues to deliver on its mandate for the pension ecosystem in Malaysia as an extension of the Government’s service to pensioners. I am pleased KWAP has achieved a record fund size of approximately RM159 billion as at end 2021 and today with the launch of TERAS 5, KWAP intends to realise its vision to grow its gross fund size to RM200 billion by 2025.
TERAS 5 is very much aligned with the aspirations of the Government to optimise the strengths of GLICs. At a time when markets are experiencing unprecedented volatility, I expect KWAP to strengthen its ability to facilitate more catalytic investments that directly benefit the Malaysian economy, continue to grow its fund size and equally important, elevate service levels for pensioners.”
Nik Amlizan Mohamed, Chief Executive Officer of KWAP said, “We are embarking on our restructuring initiative via TERAS 5 from a position of strength. In fact, for the 2021 fiscal year, we achieved a historical high net income of RM10 billion (unaudited). TERAS 5 is fully developed in house to solidify our foundation to be future ready and grow sustainably, particularly from an ESG perspective underpinned by 44 initiatives for the benefit of our stakeholders and the nation.”