113: FCLT's Eduard van Gelderen – Long Term Investing, Concentrated Portfolios and Decarbonisation

Eduard van Gelderen is Head of Research for Focusing Capital on the Long Term (FCLT), an organisation that was established in the wake of the Global Financial Crisis, or Great Recession as it is known in the US, to move away from a so-called “quarterly capitalism”, which arguably contributed to the crisis, and towards a true long-term mind-set.

Van Gelderen joined FCLT in 2024, after spending over six years as the Chief Investment Officer of pension fund PSP in Montreal, Canada. He is also well-known for his role as CEO of APG Asset Management, the investment arm of pension behemoth APG, in the Netherlands.

In episode 113 of “Conversations with Institutional Investors”, Van Gelderen discusses whether private equity can be a model for long term investing, dealing with concentration in portfolios, decarbonisation and the rise of A.I. Enjoy the Show!

Overview of podcast with Eduard van Gelderen, FCLT

03:00 In 2026, FCLT celebrates its 10 year anniversary

04:00 When I was CEO of APG AM, we became one of the first members of FCLT

05:00 Three things are important to me: innovation, strategic thinking and having an impact

07:00 Dominic Barton of McKenzie and Keith Ambachtsheer and long term investing

08:00 If corporates are too short-term focused, then they will not invest enough in truly value generating projects

11:30 I do like the private equity model, but they still look to exit in about five years. Is that really long-term investing?

13:00 One of the nice things to see when I moved to Canada is the difference in board composition

17:00 Is passive investing leading to fragmented ownership and therefore less stakeholder engagement?

18:00 If you really understand the business models of the companies you invest in, then you can be much more concentrated and still be diversified

20:00 Diversification is possible, not with a small number [of assets], but definitely with a more limited number of names than the index

23:30 Sectors that are carbon intensive will need to do something or they will be punished, weather it is by governments, or regulators. For investors this means there is a financial reality here

24:00 But at this point the carbon price is too low for investors to make a decision

25:00 If I diversify over different sectors, then I need to use the less intensive sectors to hedge what I do in the carbon intensive sectors. That is a portfolio construction question

26:00 Stranded business models: It has happened before. The ones that reacted to all the opportunities that the internet offered became the winners, but there were certainly companies that completely missed the boat. I’m convinced that we are going through the same cycle again.

29:00 I don’t think A.I. is just a toy; I think it is going to disrupt a lot of things that we take for granted

31:30 How will A.I. impact the business model of an investment manager? There will be operational efficiencies, but where managers are not yet very advanced is about ‘How can we do advanced analytics?’ And it is not just about alpha generation, it is also about portfolio construction, risk management and trading

35:30 I do think we need to rethink diversification in the current uncertain environment

39:00 Upcoming research projects: future fit boards and proxy voting 

43:00 I truly believe that public and private markets will merge at some point; it is really a data issue

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