When we did our survey of SWFs’ own asset managers last year, we were interested to discover that a large majority viewed SWFs’ internal capabilities as lacking. This perception has also come up in many of our interviews with finance professionals throughout our project.
It seems that Insead — the French business school — has found something similar. It has just launched a new dual degree program for future SWF employees. According to J Frank Brown, the dean at the school:
“What has happened over the last couple of years is a dramatic increase in the size and importance of sovereign wealth funds, the increasing ownership of business by government and an increase in regulation…Our view is that business people have to be much more knowledgeable about government, much more able to work with government and vice-versa for government workers.”
The program seeks to educate future workers on the importance of managing relationships with bureaucrats and shareholders. Indeed, SWF employees have different exigencies than their private sector colleagues, which may explain why so many of our survey respondents viewed SWF employees as lacking the necessary skills.
Interestingly, this focus on the interaction between government and business has been an important part of an executive program Insead has conducted for both ADIA and Mubadala.
So, the rise of SWFs and ‘state capitalism’ has apparently created a new niche market for business schools. With campuses already set up in Abu Dhabi and Singapore, Insead appears to be ahead of the game.