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Note: Markets Group will hold a celebratory ceremony to induct Robin Diamonte into the Chief Investment Officer Hall of Fame in Boston during the 11th Annual New England Institutional Forum on Sept 25-26. During the event, Britt Harris will have a fireside chat with Diamonte. Request more information here. Allocators are encouraged to attend.

Interview by Christine Giordano

Transcript with video interview below

Robin Diamonte, CIO of RTX, the company formerly known as Raytheon, is known as a key leader in the global pension industry by her CIO peers, and those she has worked with.

Besides heading one of the largest corporate pension systems in the United States, she’s raised funded levels significantly at every plan she's worked for. She headed UTC’s due diligence when it merged with Raytheon. She was appointed to the PBCG by then president, Barak Obama, and on a national scale, she has helped create strategies to help pension investors hedge their risks across the United States.

She’s argued that benchmarks might keep performance low, and what companies need is strategy and ideas on how to save on pension costs, how to improve funded statuses and reduce volatility. She headed a firm that became one of the first to use derivative exposures in US fixed income, US equity, and international equity. Now, she’s also finding ways to get workers without pensions to have Lifetime Income. And she’s known to have a heart for the pensioner and a sharp intellect for her corporation.

But Robin wasn’t always an investor. We’ll talk about some of her life’s accomplishments, what she’s been working on, what she sees as threats to the industry, and her advice to her peers and those rising to the chief investment officer seat in the following interview.

Christine Giordano, Editor-in-chief at Markets Group: Welcome, Robin.

Robin Diamonte, CIO of RTX: Thanks, Christine. Thanks for having me.

Giordano: A real pleasure. Thank you. We'll be honoring you with a Hall of Fame pretty soon, coming up in the fall. I just wanted to have this moment to interview you and learn things from you that others can incorporate even into their own processes. Robin, let's start with your early career. You weren't always in finance, and you came at it from an interesting angle.

Diamonte: Very true. As a matter of fact, I never even planned on going into college. When I went to a high school, it was a technical high school for electronics. When I graduated high school, I worked in a submarine as an electrician on the night shift. It was the folks in the union who convinced me to go to school for electrical engineering. I went to school and got my bachelor's in electrical engineering in New Haven. That's where I grew up in New Haven, Connecticut. I went to college there.

My first job was in New Haven as a microwave radio engineer. I was actually putting in microwave systems on top of very large buildings that had line of sight. I'm dating myself, of course, but that's when fiber optics started to become the mainstream. Microwave technology was dying. I had to really find something else to do because I was bored at my job. They dropped PCs on our desks. Actually, it was in everybody's area, you had one PC.

It was at the time where you actually turned on the computer and all there was a DOS prompt, nothing else. They dropped the computer and a bunch of books. People really did not know how to use them in the business world. I thought it was fun. I read the books. I learned how to use different software systems. I really changed my career to be a computer help desk person.

That's the origin of how I got into investments because I was working at the help desk for a couple of years, and then Verizon was looking for a technology person in their investment department to actually help their investment team become better at data analysis and building reports and doing portfolio management. I started as their technology person, basically under the desks of all the portfolio managers, doing the wiring of the hardware, and then all the different software programs.

Giordano: That puts you in a good position at the Verizon Investment Office, who was then CIO Britt Harris.

Diamonte: Absolutely. I went into Britt one day after I was working in technology for a while, and there was an opening in entry-level research. I went into his office and I asked him if I could switch over from technology to research. He warned me that when you worked in a technology area, that it was very fast-paced, and then if I left for a year or so, that I would probably just fall behind. I said I would take that chance, that this portfolio management industry seemed a lot more exciting than computers at the time. He took a chance on me.

Giordano: Was there a trial period where you'd give it a year and if it didn't work out, you both agreed that you'd go back to what you were doing? Was there some unspoken agreement and why did you think it would be so much more exciting for you?

Diamonte: I love the research-oriented side of it, and I saw the analysis that they were doing. There was scenarios where you could lose money or win money. We had a research group that at the time wasn't delivering the type of research that Britt wanted. I think that my background with math and my computer skills, I felt could really help them grow their expertise in this area and design the computer programs that they were looking for to help us with our research.

Giordano: You built a platform, if I remember correctly.

Diamonte: I did.

Giordano: How did you revise that?

Diamonte: We had different portfolio managers who were analyzing investment managers at the time. Every portfolio manager had a different way that they would like to look at historical returns or holdings. Each one would come to our research department and say, "Can you do this analysis? Can you do this analysis?" It was very time-consuming and every report was different. At the time, I standardized one-- I built this system in Excel and I built a system where the portfolio manager themselves could upload any stream of investment manager returns, and then just by picking some lists, they were able to create a five-page report that showed every statistic that you ever want on a manager and its returns versus a benchmark going back in time.

Giordano: Highly efficient for comparisons.

Diamonte: Yes, absolutely. That started-- I would say, was my first small success on the research team, and over time, actually took over the research team.

Giordano: Then you headed the research team?

Diamonte: Then I was head of the research team. My first very large project was taking over the savings plan. At the time, the HR departments used to take over-- they used to do all the investments for savings plans and they would do stable value portfolios or insurance companies. A couple of the insurance companies blew up. It was at that point where they said, HR people shouldn't be picking the investments, we should have the investment group do that so I had to take over the savings plan.

It was at that point where I started working with Morningstar and Fidelity and really learned more about investing.

Giordano: From there?

Diamonte: Oh, from there, Britt gave me a little bit more and more responsibility. Overseeing the strategic partnerships, all of our external managers, our asset allocation, our research. Eventually, I was like his number two. Then I got tapped on the shoulder to be the CIO of UTC. That was almost 20 years ago.

Giordano: What put you in the limelight, so to speak, through every point in your career? You were the person who took over the computer that was dropped in the department. You're the person that revamped the research department. You seem to have a way of rising through the ranks. When UTC merged with then Raytheon and now RTX, you were chosen to be the person who headed both plans and merged them together. What is it that you find gives you that turbo boost to the top of the ladder, so to speak?

Diamonte: People ask me that sometimes, and it's not exactly intelligence. It's a little bit of emotional intelligence or really understanding what your customer wants. I go back to school days, I was always able to get very good grades in school, and not because I was the smartest student at all. It's that I would sit there in the beginning of our semester or our class and listen to the teacher and understand exactly what they were looking for and was able to whatever I had to do, build essays or create equations and give the teacher what they wanted.

I've done that in business. I've worked for managers and my customer now is the CFO in our investment committee and the board. You listen and you say, "How do they define success?" You think a little bit out of the box, you create yourself a great team and you provide the customer what they want. Back in the day, it was Brett Harris. Then since then, I've had a lot of supervisors and try to always ask that question. I think that's what has actually helped me to be successful in this business.

Giordano: Of course, you've got the medal as well. You've significantly raised the funded levels of each plan that you've taken over. Can you go into some detail on that?

Diamonte: Again, it's about understanding what the focus is or the mission of your group. Back in the 1990s, chief investment officers and investment teams really didn't understand what liabilities were. All we were really is a moneymaker for the company. We provided great returns. We outperformed our liabilities. Again, we didn't understand what that was, but we knew that they were putting a benefit into our employees. We had returns that were so much more superior than that, and those returns flowed right into the EPS of all public companies.

They were very happy with our performance. Then over time, we had a couple of crises. We had the tech bubble bust, and then the global financial crisis. We had perfect storms during those periods where equity markets went down and interest rates went down at the same time. Many of the corporations found that their funded status went from well over 100% down into the 70s, and that happened with UTC.

I think it was the immediate realization of our mission is not to get great investment returns, our mission is to get great investment returns, but also understand what our liabilities were. The mission at that point when our funded level was only 70% was, "Let's fill in the gap so that we get to 100% or 110% or whatever is needed. We do that in a way that we're not taking a lot of risk versus our liabilities." There was the introduction of LDI or liability-driven investing, and we had to combine that type of new investing, but also be aware of what the company needed.

You always had to find a solution that was win-win. Be a great fiduciary to the employees, but at the same time, be a great corporate citizen so that you're not causing the company too much pain when it comes to contributions into the plan or volatility of market returns.

Giordano: You've also used different techniques to keep risks low. I think you were pretty new or you were perhaps one of the first to derivatives?

Diamonte: We used derivatives early on. We used derivatives not for taking a lot of leverage at all. It was really for risk control. We used derivatives for rebalancing the portfolio for liquidity management, and we used it for portable alpha. We were one of the very first funds to have a significant portable alpha portfolio, but we did it in a way where we were using futures and derivatives to take underlying beta risk, but we were giving the cash to hedge funds.

That seemed cary at the time, but there were not hedge funds that were correlated with the underlying beta. They were hedge funds that were absolute return. We were successful in saying if the underlying futures were in S&P 500, then the alpha was just three to 4% above that. We weren't taking significant risks and we weren't being correlated to the underlying market. We were able to be very successful in using derivatives early on.

Giordano: Currently, everyone always wants to know what managers you hire or who you're looking to hire.

Diamonte: People ask about our business and talent and the type of people that I hire to do this. I always say it's more of an art than a science because there's not one specific manager that you would use. You don't say, "Well, I just want fundamental managers," or "I want quantitative managers." There are so many investment managers out there. We look for a lot of different qualities. We look for qualities where we really see that the portfolio managers are passionate about what they do. We have to see a competitive advantage or an edge that they have in their style versus what the benchmark is.

We're always looking for significant risk control in their policies, their processes, because reputation risk is very important to us. We don't want to see our name on the RTX's pension fund invested in a hedge fund that blew up. We're very careful about that our managers have risk control. It's really a combination of understanding what the manager's doing. If we don't understand it and it's a black box, we don't want to invest in it. Understanding why we think they have a competitive advantage, when they're going to outperform and underperform, and then building a portfolio to optimize those return streams and those styles over time.

It's not one specific manager. It's really the characteristics of the manager.

Giordano: Any red flags in managers that steer you away from them?

Diamonte: Yes, there's definitely some red flags. if we see processes that were the same, that it's packaged in a brand new form with a cute little name, but it's a factor analysis that we've been doing for the last 30 years is a red flag. It's a new name over an old process. Lack of risk control. Sometimes it's historical performance in only certain periods over time. Maybe their style is really arbitrage in something that's happening in the market, but it's probably or may not be persistent. You're thinking that, "Okay, you understood how to make money in an environment, say what interest rates were falling, but can you do that if they're rising?"

There's some red flags. If you ask questions and you look at back testing and it's not a robust analysis.

Giordano: It's 2024, it's late summer. People are still talking about liquidity in their portfolios. What are you doing for liquidity in yours?

Diamonte: Most corporate plan sponsors, not all, but most of them are getting pretty close to being fully funded. There's a lot of pension or plan sponsors that are de-risking. That means shifting from their growth in equity in very liquid assets to a bond portfolio. A lot of us have a lot of private equity, private credit, direct real estate, which we have that's less liquid. We have very large pension benefit payments that are due every month. We're needing to get out of those growth assets that are not necessarily liquid.

We do an analysis every month that looks at the liquidity profile of our portfolio. We put it in buckets, like how much of the portfolio could we liquidate in a couple of days, in a week, in a month, or more than three months and need to feel very comfortable with that strategy. We also make sure that we hold enough liquidity for several months in benefit payments in either cash or short-duration bonds. We're always looking at the liquidity of our portfolio.

We have two portfolios that are significantly large that we call policy management portfolios. They're basically derivatives. One is a bucket of equity derivatives and one's bond derivatives. We use that for liquidity. We have the underlying assets in cash, but we're using futures to get the exposure. At any time, if we need the liquidity, we just take off the derivative exposure and we have the cash. We're always replenishing those portfolios. We've been doing that for many years and it's worked very successfully.

Giordano: What percentage of your portfolio does that?

Diamonte: It's a significant percentage because of our portable alpha portfolio. Remember I said our portable alpha portfolio is about 12% of our overall portfolio. We're getting 12% of our exposure through derivatives. Then the rest of it is cash that's invested. We keep a pretty significant margin or a percentage of that that's available for cash.

Giordano: Are your plans open or closed, frozen?

Diamonte: Because we've acquired many companies over time and we're trying to synchronize the benefits, there are different pockets of the company who has different types of benefits. Some of our union plans are open to new entrants but there's very few. Most of the company is hard frozen to all new employees. The majority of it is hard frozen so that they're no longer accruing in a traditional pension plan. There's a small piece of the plan where there's a cash balance plan that's still open. It's all over the place.

Giordano: Robin, I know a big theme throughout your career, throughout your emphasis in working with the PBGC, has been lifetime income for all workers or pensioners. Can you tell me how you came to that?

Diamonte: Yes. There's a point in your career, because I've been doing this for a long time, where you stop being very competitive and you just want to get the best investment returns so you have to have meaning in your job. For me, it was, "All right, what's the meaning to my job?" The meaning was that, "I want to make sure that regardless of who it is, if it's RTX employees or just other corporations employees, that they get the benefits that they were promised when they were working so hard their whole life."

That's the goal of our job is that people work their whole life, they work very hard, they get to a retirement age and then they expect to live for another 10, 15, 20, 30, 40 years now without working and they need to have enough money to retire. That's our goal. Ultimately, that should be always our goal. What we did with the PBGC-- I was lucky enough to be on the advisory committee for the PBGC and I started in 2013 when the PBGC had a deficit of $35 billion.

The PBGC was very well run at the time, but there was a lot of different competing philosophies on how the asset allocation should be completed, whether they should look like a pension fund and have growth assets to close the deficit or whether they should be an insurance company and have only bond assets. Unfortunately, depending on who took over, they kept on switching their strategy at the wrong time.

We had a great advisory group and we got together and we worked with the board of the PBGC, which is the secretary of labor, the secretary of treasury and really introduced to them the concept of LDI and had to bring in certain managers to work with their CIO team and the advisory committee and to really develop a really good, robust LDI program. It was at the same time where they were starting to raise some premiums also.

They really embraced this new concept and now their entire portfolio is mostly hedged liabilities. Now they have surpluses well over $30 billion. They went from minus $35 billion to close to $30 billion in 10 years. I wasn't solely responsible for that, it was the markets, but I do take pride in the fact that I was part of an advisory committee that was able to support a new type of asset allocation strategy that worked really well. [crosstalk]

Then you asked about lifetime income. Lifetime income is different. Lifetime income is-- when all the corporate plans were freezing the pension plans, we knew that our new employees were going to have significant risk going forward. They were not going to be able to retire and have an annuity for the rest of their life. They were going to retire with a lump sum of money. It was up to them to invest it in a way that they had enough money to live comfortably, but not run out of money.

We didn't want our employees to sit there not spending money, to live in a poor state because they were afraid they were going to outlive their money or the worst case scenario is that their money runs out when they're 80 years old and they live to 90. That was the beauty of a DB plan. It was all the mortality pooling and that you knew how much money that you can rely on for the rest of your life.

What lifetime income was about was trying to get a product that provided an annuity-like benefit in the DC plan because the DC plan was going to be the way of the future. That was going to be the vehicle that employees were going to have to use to save for the future on retirement. We started really early on, around 2007, 2008, researching different products. We put one in about 12 or 13 years ago and it's our default option. Our new employees are automatically enrolled in it.

They can opt out and go into other types of investment options but if they do stay in it and decide to withdraw the money later on, they have almost the best of both worlds. They have a portfolio that has a high balance that they can access at any time. They also have an annuity guaranteed for the rest of their life. That's what the lifetime income products are about.

Giordano: What percentage of the employee's salary goes into it?

Diamonte: When we start off a new employee we auto-enroll them at 6% and then we auto-escalate them 1% a year for four years. When they're done, they are contributing 10% of their salary if they don't stop it in the meantime. They're contributing 10%. The company will match 4% of the first six. If you're an employee and you've worked for the company for four years, you're getting 10% of your salary going into savings. The company's putting 4% in as a match. That's 14%.

Then because we closed the pension plan, they're also getting an additional contribution from the company into the savings plan in lieu of the pension plan. That ranges anywhere from 3% to 7% based upon your age. It's a really nice benefit.

Giordano: You could actually be having a 17% into--

Diamonte: 17% of your salary going in which is the rule of thumb. Between 15 and 20, you should be saving in order to replace adequate income when you retire.

Giordano: How difficult is this to establish within a company?

Diamonte: 12 years ago it was difficult because there was not a product like it. You have to get buy-in from multiple organizations. You have to have the investment team to really understand the product. You have to have the HR team to say, "Yes, I'm going to embrace this and do all the communications and have all the systems in place so that people can actually choose this option." Then you need your ERISA lawyers to be able to feel comfortable that the strategy is going to work and they're not going to get sued later on. I was lucky enough to have an extremely good relationship with all of our folks in HR.

I had a great investment team and we picked apart constantly the strategy before we implemented it. Then I had fantastic, and I still have fantastic ERISA lawyers who always put the fiduciary first and figured out a way to address legal concerns. Now though, 12 years later, finally there are some large institutions and investment managers who are coming out with these off-the-shelf, viable lifetime income products. I think we're going to start to see some large corporate plan sponsors start to introduce that into their plans, which I'm really excited about.

Giordano: It's like a one-stop shop now and getting it all together.

Diamonte: That's right.

Giordano: You've also been working with the Aspen Institute and you've made some interesting findings on your own. Can you get into that?

Diamonte: Yes. The Aspen Institute has a finance advisory committee that I've been on for multiple years. The purpose was to get a large corporate plan sponsor to be on the committee so that they can help set different policies and products and things for all Americans to save for retirement. Not just people who are lucky enough to work for large corporations. How do we address the retirement crisis which is coming in America?

I've been lucky enough to be on this advisory committee. One of the things that they recently decided to take a look at was about diversity and are underrepresented groups saving in a similar way as say a white man or a white female? I thought that that was a really interesting thesis because we hear oftentimes that different underrepresented groups are not saving as much. I thought egotistically, "Well, I have one of the best savings plans in the world and everybody has access to this. I think when I look at the data, everybody's going to be saving in a similar way... but that wasn't the case.

What the Aspen Institute is doing is they have a special project where they're taking data from all large corporate plans and they're trying to build a very robust data set to understand what's happening and why is it happening so that we can fix it. We were one of the first large corporate plans to provide data into this. What we found is that there are discrepancies even when you normalize for salary which is unusual.

You normalize for salary, you normalize for tenure, you normalize for age, and you still see discrepancies. What this study did was it looked at eight different categories. It looked at white, Asian, Hispanic, and Black, female and males. Then it normalized for salary and it looked at lots of different factors. What we found was interesting. We found that Asian women were actually the best savers, even ahead of white men. We found that Black females and Hispanic females had the lowest balances, even normalized for salary, across all salary ranges.

When we dug into this a little bit more, what we realized is that they may not be saving as much, which was a small contributor, that they were a little bit more risk adverse, so not as much in equity, but more importantly, they were taking out more loans and they were taking out hardship returns, which means that they were taking money out of their savings plan for other reasons.

What are we doing with this information? We're trying to build more communications, education, designing benefits around this, and trying to understand why. We're meeting with various ERG groups, talking to people saying, "What do you think this is the reason?" and finding some really interesting things. One of the things that we found is that there are unexpected medical issues, people need to help family members because of culture reasons.

What's happening is they're pulling from their savings. They're pulling from their savings plan. We're trying to provide education around why that doesn't make sense and helping to help them build an emergency savings fund and the education to use that first. That's just one example of the many ways that we're trying to address some of the issues or the differences that we're seeing in the data.

Giordano: I remember reading-- Years ago, there was a study that showed that people were pulling from their savings to help their kids through college or their grandkids through college. It made the point of saying, "Hey, these kids can make that money back if they take loans their whole lives. You've only got a few years left here." Is that intuitive though?

Diamonte:. We have tools. There's tools that you can find on the internet, but as a company, we actually hired a vendor and we put financial wellness tools in place. We use a combination of that and Morningstar's tools to help our participants actually think about, "All right, I have loans coming out to college. I want to buy a house. I have this income in and I also want to save for retirement and also I have to pay down this credit card."

What do you do first? How much of your money goes here? How much of it goes there? It really depends on an individual circumstance, but we do have some of these tools and there's tools that are out there that if you're willing to spend time in them and put in all the data, it will optimize a portfolio for you or it will optimize a budget and help you through those types of analysis.

Giordano: Interesting. Just changing things up a little bit. When I speak with other CIOs about you and say, "Well, what is one of the things that you'd like to hear Robin talk about?" what comes up is the fact that you're not only an investor, but a mentor. You have this incredible ability to mentor your staff in such a way that they can fail, they can learn, they perhaps have training wheels on, and they can't be poached in some ways.

I hear stories about your staff being offered great positions, but wanting to stay in your office. Can we talk a little bit about your philosophy around staff development? Obviously, we're in the post-COVID environment. How are you managing all of that?

Diamonte: Can I say some of it has been lock-down? I'd say the philosophy is that if you're managing a corporate pension plan in a place that's not New York or Boston, or a major city, it's hard to get really good finance people. I always look for people who have grown up in the area, who went to some fancy school. It doesn't even have to be a fancy school, but went to some business school, loved finance, did their stint in Boston or New York, and now they want to start a family, and they want to come back.

What happens is if somebody is in that mode where they want to be intellectually challenged, they want to take ownership, but they want flexibility in their time so that they can coach their kid's soccer team, or go home and have dinner with their family, and then maybe jump on the computer. That's been my management style. My management style has been, you hire super smart people who have this intellectual curiosity, who love working for one of the largest funds in the world so that we can call up any investment manager and say, "Hey, I'm interested in your product. Can you come down to our office? Let me hear about that." That helps.

The ability to be able to talk to so many managers when somebody loves the investment business is really helpful. Then I try to give them the autonomy to make the decisions on their own. Once they are mentored appropriately and understand the philosophy and the mission of the group, then it's, "Here's your portfolio," if it's global equity or LDI and it's, "You hire and fire managers, and I will be there to provide guidance or to question you. Is this what you really want to do? Think about this," but ultimately it's their decision. When you give somebody flexibility and autonomy, it creates an environment where they're happy with their job, hopefully.

Giordano: You've also started projects in which they can apply their investment acumen.

Diamonte: Yes. We're always trying to do something that's a little bit different. We started strategic partnerships, which we did at Verizon, which is really get one of the best managers that you think in the world and give them a portfolio or a lump sum and say, "Okay, manage this money better than us. We did this." We go through an RFP and we figure out who those managers are. We give them a lump sum, then we say, "Okay, you have to be 8% over a longer term."

That was one of the things that we did. We had a flexible capital portfolio, which was anything that you find that doesn't fit nicely into our current asset allocation buckets, you have to bring that idea and create a paper and you have to go through certain gates. All the portfolio analysts worked together on these ideas and then brought it up through the director level. Then we would pick apart their idea and they'd go back and get the questions answered.

If they got all the answers to questions and they had a good theory, we put money in it and we did that for a while. It was supposed to be a billion-dollar portfolio and that was fun, but then we had to de-risk so we disbanded that portfolio, but we're always looking for different ways to do some of the fund investing and not just investing in bonds and hedging instruments.

Giordano: How are you handling a hybrid environment?

Diamonte: Right now we're flexible and the team comes in three days a week, and then some of the team is remote, but I think we're getting pretty good at it now where we try to do a lot of team building. We instituted something where we have a lunch-and-learn or a team-building event once a month and we rotate who's responsible for it. We have done things like fitness classes to bowling and go-karting. We did something last month on ERISA fiduciary litigation stuff. It spans between really serious things and just fun, active things. We always try to come together as a group and do something that's fun.

Giordano: In your philosophy, if someone wants to make it to the CIO seat someday, do they need to be in the office?

Diamonte: Yes, absolutely, because you can only learn so much on Zoom. I realized that if we go and we meet with an investment manager, if we do it on Zoom, everybody says goodbye and we hang up and nobody talks about it. When we're in the office and we meet with an investment manager and then they leave, we all group around somebody's desk and we pick apart the strategy. That's the only way that people can learn from each other about the advantages and disadvantages and who's thinking about things differently. I think you have to learn from other people. You have to learn from other groups, interactions, you have to be in cross-functional projects, whatever they are.

I don't know if you can truly develop, especially if you're younger, in your living room behind a screen. You really need to get out there and be with people. Maybe not five days a week, but at least half of the time.

Giordano: Also active in other projects. You mentioned a little bit about the PBGC, but outside of your work at RTX, you spent years at the leadership levels at CIEBA. Can you talk about some of the themes there?

Diamonte: Yes. CIEBA is an organization of some of the largest and mid-sized CIOs. We manage a lot of assets collectively. We get together once a quarter, and it's really an organization that has been incredible to my career because it's people that have my job everywhere else and all the other corporations, and we just benchmark on everything. We have a committee on DC plans, we have a committee on DB plans, we have an investment committee.

Our main focus years ago was actually we always met in Washington, DC because we wanted to try to shape and educate Congress and legislators on retirement benefits and things that they may possibly do that can hurt employee benefits. That was the main function of the group. Over time, we still do a lot of that, trying to shape policy, but we also help each other be better corporate plan CIOs. It's just been an amazing group for me.

We have different committees and vice chairs and co-chairs, and I think I've chaired all the committees. I chaired CVA myself, and now I'm on the board. As we start to bring some of the younger folks, it's just really such a dynamic organization. We've done a lot as a group together to try to shape the industry.

Giordano: What are some of the things you've taken a legislative stand on?

Diamonte: Oh boy. About 10 years ago when we knew that a lot of what the DOL was doing or Treasury was doing was going to close pension plans because of the accounting rules that were changing, the limit of smoothing when they had something that was called PPA was a legislation, we went and we talked to various legislators to try to have them tweak the law to benefit the plans, and it actually worked.

There was a fiduciary rule that came out a while back. It's been very controversial for a lot of different reasons. We as CIOs wanted the fiduciary rule because we knew that when our participants retired or left the company, there were a lot of bad actors that were trying to grab their assets and make them pay really high fees. We wanted the DOL to say, "If you're going to take a rollover of retirement assets, you need to be a fiduciary and act as a fiduciary.

As a matter of fact, I went to the White House to actually talk to Obama's-- I think it was corporate secretary or something at the time, because he wanted to understand is this something that they should support, the fiduciary rule. Throughout time with the DOL, they keep on changing it, but one thing that they haven't changed is that if you're going to take retirement assets, you should be a fiduciary. We fight for things like that to protect our participants with the DOL or with Congress.

Giordano: Currently, what are some of the threats that you're seeing to the industry?

Diamonte: There's been a couple of large plans that have been outsourced to asset managers, and we saw this trend a couple of years back. What ended up happening is all the plans that were outsourced actually ended up coming back to the corporation. Now we're seeing again, there's been some very large, visible plans that have been outsourced to large asset managers or actuaries.

I think that this could be a damaging trend, not only because I'm a CIO and it's because it's taken away our work, but I also think that being a team inside a company has a lot of benefits to an organization. I'm not just a CIO who's trying to make investment returns on the company, I'm part of the finance committee, I listen to what's happening in the company, and I try to make sure that whatever we're doing in the pension plan doesn't hurt, but would help all the finances in the company and at the same time, make sure that our participants are being well taken care of.

I think what ends up happening is with these large firms, they come into the CEOs and the CFOs who may not understand everything that's happening in the pension fund, and they say, "You're not in the core business of managing pensions. We can do it for you cheaper, in a smarter way." We found time after time that that's not really the case, because as a fiduciary, you still have to be a fiduciary and oversee that manager.

What ends up over time is you lose the entire expertise in the company and there's no one overseeing that manager. That manager is now not looking out in the best interest of the company. They just want to increase fees and there's nobody overseeing them. Over time, they're not really tied in to the management issues of the company. It can be self-serving. Now, I'm not saying the whole CIO business is bad by any means. For some plans, it makes a lot of sense.

Some midsized plans, smaller plans, some plans that want to get out of the business. I think it's one of those things that might be a trend that might go swaying too far and that senior management really has to pay attention to what the CIOs and their team are doing to make a really well-educated decision, "Is this what makes sense for us in the long term?" because I think in many cases it doesn't.

Giordano: If you're a CIO and you're, let's say, in the crosshairs of a takeover by an OCIO, what's some of your advice as to prove your strengths?

Diamonte: A lot of times, unfortunately, this is all done behind the CIO's back. The CIO isn't aware of it and the team's not aware of it until it happens. What we need to do as an organization is make sure that we do a better job of educating our CFOs and our CIOs on what the real issues are and the pros and cons of going to an OCIO. Maybe the cons. Then make sure that-- remember, one of the things I said on how to be successful is that you really understand what the company needs, what their mission is, and how you fit into the company.

You can't view yourself as only a team that just gets good investment returns. You have to view yourself as an integral part or a manager, an executive who helps the company manage the pension plan, and not just being an investor. I think some of the ways that in CBOs we've talked about this is really arming our members with a checklist of, "Here's what the OCIOs are saying, and here's really what the facts are. Make sure that your senior managers understand this so that if the large players go and they're buddies from old college days and say, 'I can manage this for you,' they step back and they get you involved in the decision."

Giordano: Which brings us to the question of, Robin, you've been in this industry for decades, you've made your changes across the board, but looking back on your career, what as a Hall of Famer, would you like your legacy to be?

Diamonte: Oh, legacy. First of all, for RTX, I want to ride in the sunset to say, "Okay, I'm done. We're completely, fully funded, we're at an end state, we're hibernated and our senior management does not have to worry about the pension plan again." That would be [crosstalk]

Giordano: How close are you?

Diamonte: I'm close. I'm close enough that at least if I leave, the rest of the team could get there without a problem. I would say that's one legacy and there's a couple of others. I want to try to make an impact on what I think the retirement crisis is for other people and maybe provide the means where other people can get educated on some of the issues. I think potentially when I retire, I'd like to do some financial literacy training. Not the college kids, not the high school kids, but start even younger, like in a junior achievement. Then also an impact on diversity and really make sure that all people have access to the ability to save for retirement and the knowledge and the education and the systems around so that there's equality in that. I think that's extremely important.

Giordano: Last question, what's the Robin like outside of work? What are your hobbies? What are your passions? What do you do for fun? When do you get goofy?

Diamonte: I'm super boring. Super boring. I have a wife and two teenage daughters and I try to spend as much time as I can with them. I love to play Pickleball and run and exercise and travel and just really try to be active. Love the beach and I don't read self-help books, I read fun fiction. It depends on what it is over time. Used to be vampire romance novels. Now it's fiction. It's a little bit more educational fiction, but it rotates through time.

Giordano: It sounds like you have a very full life between the work, the career, and the kids and everything. Thank you so much for making time here and we've-

Diamonte: Thank you for having me. Loved it.

Giordano: -learned a lot. We're looking forward to your Hall of Fame ceremony in the fall.

Diamonte: Thank you. So excited about it. Thank you, Christine.

Giordano: Me too. Until then. Thank you, Robin Diamonte, CIO of RTX.