The Public Investment Fund seeks to become one of the largest sovereign wealth funds in the world. To achieve this, the Fund is building a world-class, diversified portfolio through investments in attractive, long-term opportunities at both the domestic and international level.
PIF History and Context
For more than 46 years, the PIF has been a leading economic player and has contributed to the development of national investment entities constituting the foundation for overall development, while contributing to the establishment of many of the largest companies in KSA. Established in 1971 by virtue of Royal Decree No. M/24, the PIF has throughout the years financed many key projects and companies and provided financial support to projects of strategic importance to the national economy.
On March 23, 2015, the Council of Ministers issued its resolution number 270, assigning the PIF to report to the Council of Economic and Development Affairs (CEDA). Accordingly, the Board has been re-formed, with the Crown Prince, HRH Prince Mohammed Bin Salman Bin Abdulaziz (Deputy Prime Minister and Chairman of CEDA), as the Chairman. This was a major step toward assigning more comprehensive authority and more well-defined national strategic responsibilities to the PIF.
The PIF’s economic role has grown at a fast and innovative pace in light of the broad strategies approved by CEDA, as part of the broader effort to drive national economic transformation and achieve positive and sustainable change in KSA. The PIF’s economic role has also grown through its effective work in developing the local economy, expanding its portfolio of international assets (through investment in international sectors and markets), and establishing strategic partnerships to achieve its objectives effectively and to maximize sustainable returns as part of the ambitious Vision 2030 objectives.
Vision, Mission, and Objectives
Following the announcement of Vision 2030, it was essential that the PIF develop a new and ambitious strategy to realize the Vision. The requirements of the future and the needs of the present call for a renewed framework to overcome challenges and meet expectations, and the PIF responded by developing a new structure, improving its strategy, and redefining its vision and mission
In particular, the PIF developed six investment pools comprising local and global investments in various sectors and asset classes spanning a wide geographical range. These portfolios are associated with the PIF Program’s four objectives.
To be a global investment powerhouse and the world’s most impactful investor, enabling the creation of new sectors and opportunities that will shape the future global economy, while driving the economic transformation of Saudi Arabia.
To actively invest over the long term to maximize sustainable returns, be the investment partner of choice for global opportunities, and enable the economic development and diversification of the Saudi economy.
Saudi Arabia’s Council of Economic and Development Affairs (CEDA) oversees the overall performance of the Public Investment Fund, whilst the Board of Directors is responsible for the Fund’s investment policies and strategic decision-making. This includes ensuring that the Fund adheres to governance best practices and achieves the high levels of transparency expected from one of the world’s leading sovereign wealth funds.
Governance Framework and Executive Committees
The governance framework includes the Board of Directors and the Board committees. The roles and responsibilities of the Board are classified according to five main themes: strategy and planning; governance and oversight; regulation, recruitment and remuneration; reporting and monitoring; and investment. The key tasks of these committees are as follows:
Board of Directors
Audit, Risk and Compliance Committee
The Public Investment Fund has put in place standardized procedures and guidelines to govern investment decisions, focused on building a diversified portfolio which achieves attractive, risk-adjusted returns over the long-term.