It will depend on Anja Mikus. If everything goes as planned, she will soon have a decisive say in how secure pensions will be in the future. And how great are the burdens for the employees who have to finance the pensions with their social contributions. Mikus is expected to invest tens of billions of euros on the capital market. If she has a good hand at this, a few billion additional dollars could be saved for Germany’s pensioners. If it makes the wrong decisions, expectations of stock pensions or “generational capital,” as the coalition model is called, are likely to be disappointed.
The project is controversial. Finance Minister Christian Lindner (FDP) defends it as a project for intergenerational justice that should have started much earlier. BSW chairwoman Sahra Wagenknecht, on the other hand, attacks generational capital as a “casino pension” and the coalition is “gambling” with citizens’ old-age security. Anja Mikus says: “It’s unbelievable how many years we have forgone the additional income from the capital markets, including many private individuals.”
Kurfürstenstrasse, in the middle of western Berlin. Around 40 employees of the “Fund for Financing Nuclear Waste Management,” or Kenfo for short, sit on the first floor in a concrete-gray box with a brass-colored double door. 24 billion euros are managed here, money that the operators of German nuclear power plants transferred to the foundation behind the fund in 2017 and that pays for the storage and disposal of nuclear waste. To this end, Kenfo pays out a three-digit million sum every year – and still tries to preserve the capital through clever investments. The boss is Anja Mikus.
A similar model should also fill pension funds in the future. The federal government is borrowing billions at low interest rates, and a foundation is supposed to invest the money in the capital markets. From 2036 onwards, it should transfer around ten billion a year to the pension funds in order to at least slightly dampen the increase in pension contributions in aging Germany. It will start this year with twelve billion euros, and a double-digit billion amount will be added every year. This generational capital is still stuck in the coalition dispute over the pension package, but the cabinet should pass the corresponding law in May, as Lindner, Chancellor Olaf Scholz (SPD) and Economics Minister Robert Habeck (Greens) agreed this week. Mikus and her people are also supposed to manage and increase these billions.
Considering that 24 billion euros are being handled here, the office seems rather modest. Mikus welcomes you on a light gray carpet between gray-brown furniture; a steel beam gives the room a touch of start-up loft. All quality goods here, but simple. The rooms could also be the representation of an insurance company. Not as glamorous as the world from which Anja Mikus came when she took over the head position at Kenfo in 2017.
She gave up money for the new job
The business graduate has been working in the investment industry for 35 years. She rose from securities analyst to managing director of the Allianz investment company in the asset management of the Allianz Group, then top positions followed at other big names: Allianz Pimco Asset Management, Union Investment private funds, she headed the portfolio management and investment strategy of the Union Group , before joining Arabesque Asset Management. A change between the executive floors in chic office towers.
So now Kurfürstenstrasse, first floor. Why is she doing that? “Without the social significance of the task, I would not have taken over the management of Kenfo,” says Mikus. “I also gave up my salary for this.” You could say: She wanted to do something meaningful in the last stage of her career. Taking care of the financing of community tasks, nuclear waste disposal and soon also pensions. “It is important that someone reliably completes this task,” says Mikus.
At Kenfo, Mikus didn’t join an existing team that she had to deal with, with ingrained procedures and old power struggles. She was able to completely rebuild the team. Daredevils, for example, who want to achieve high profits through risky maneuvers and always leave behind high losses, do not need them for this task. “We don’t want people who are driven by testosterone,” says Mikus – “but we couldn’t pay them either.” The Kenfo reward system fits in with this. Yes, you pay bonuses if you beat the benchmark, i.e. make more profit than comparable indices such as the global stock index MSCI World, says Mikus. “But not to individuals. They have to be earned as a team and not by lone fighters.”
Mikus has drawn her conclusions from her experiences in the traditionally masculine investment industry, where it is not just the cliché that tough men in fierce competition want to fulfill their requirements with great effort. “The financial industry was and is a man’s world. That’s a very, very shame,” says Mikus. She tried to change something about that years ago “Fund Women” participated, an international network to promote women in the financial industry. This has been going on for almost ten years. “200 women came to the fund women’s first event in Frankfurt, and over time the network has grown to 4,000 women.” With Kenfo, Mikus was able to implement her ideas. 40 percent of management positions are held by women, she says. “But there are only a few who apply.”
Probably the strongest contrast to her previous positions is working within a public foundation where the logic of investment and politics collide. Kenfo does not have a supervisory board like a corporation; instead, there is a board of trustees in which representatives from the ministries of economics, finance and the environment as well as members of all parliamentary groups in the Bundestag sit. They appoint the board with Mikus at the top, and Mikus has to report to them on a regular basis. And discuss how the billions will be invested.
Which investments are taboo?
And there are definitely wishes. There are MPs who have visited companies that they then recommend to Kenfo for investment. Everything is well-intentioned, says Mikus, her people will then check it out. But it would have to fit into the investment strategy. The group discusses this again and again. The central question: Where should Mikus invest the billions? How sustainable, how social? The Kenfo is supposed to achieve a decent return, in the crisis year the fund was in the red by 12.2 percent, last year it gained 11.1 percent, and this year alone by the end of March it was 3.7 percent. But how strict should the policy guidelines be? Should we ban investments in weapons, tobacco or coal-fired power plants?
“We would have liked to represent the sustainability of the investments more pointedly,” says Sebastian Schäfer, referring to Mikus, the financial expert sits on the Kenfo board of trustees for the Green group. But he also says: “Politics would have to specify the investment criteria.” He also found Ms. Mikus to be professional; she was very transparent about where the money was invested. “These are infinite tables.” Mikus says that such criteria are taken into account and, for example, they do not invest in weapons companies or nuclear companies. “I fear that some people have too high expectations of what can be achieved with exclusions. This is partly cosmetic and has no effect.”
What is meant by sustainable is subject to social evaluation and that can change. She wants to have a largely free hand when it comes to investing. This should also be the case with a pension fund. But that’s not a contradiction, says Mikus. “You can see that those who don’t treat their employees well, those who pollute the environment, those who don’t separate functions adequately will perform worse in the long run.”
She can no longer hear the rumors about the alleged gambling. “Gambling has absolutely nothing to do with what we do.” You invest the money for the long term, strategically, controlled and with a steady hand. That means: without becoming nervous in crises. Just as consumer advocates also recommend to private investors. Mikus believes that the myth that people only gamble on the stock market is an expression of the deep-rooted skepticism of many Germans towards the capital markets. This meant they missed out on a lot of profits. For yourself personally, for your retirement provision, for the pension fund. “We need a change in mentality in Germany. Generational capital can be an important step towards this.”