Hedge fund supervisor Sir Chris Hohn as soon as made a level of telling a excessive courtroom choose that he was an “unbelievable moneymaker”. This week Hohn proved his level – definitively – when it was revealed that he paid himself just shy of £1m-a-day final yr.
Hohn collected $479m (£343m) in annual dividend funds from his The Children’s Investment (TCI) fund in the greatest ever private payday in the UK after doubling earnings at his Mayfair hedge fund, run from an workplace a couple of doorways down from Louis Vuitton’s flagship retailer.
The payout – which works out at £940,000 for each calendar day of the yr, and is almost 11,000 instances the median UK full-time wage – has shone a recent highlight on Hohn, a billionaire who goes to extraordinary lengths to guard his privateness after receiving common dying threats.
As effectively as earning profits and choosing boardroom fights, Hohn, who was once chancellor Rishi Sunak’s boss at TCI, is one of the nation’s greatest philanthropists.
He has pumped greater than £4bn into his private kids’s charity. And lately he has taken on a second trigger: the local weather disaster, promising to make use of his fund’s $30bn of investments to “force change on companies who refuse to take their environmental emissions seriously”.
Well identified in the City and on Wall Street as one of the most aggressive activist traders, it got here as little shock to Hohn’s associates that he was not ready to attend for governments to take motion on local weather change.
Instead he has pumped cash into Extinction Rebellion (XR), the “respectful disruption” marketing campaign that has staged excessive-profile sit-in protests round the world. When Hohn was revealed as XR’s single greatest donor, he mentioned: “Humanity is aggressively destroying the world with climate change and there is an urgent need for us all to wake up to this fact.”
Hohn, who has solely given a handful of tightly controlled media interviews all through his profession, pleaded with the excessive courtroom choose overseeing his divorce 2014 from Jamie Cooper-Hohn to ban the media from the courtroom.
However the request was denied, giving the public a glimpse into the billionaire’s surprisingly modest way of life, his motivations for making a lot cash, and why he didn’t view his spouse of 17-years as worthy of half the household fortune.
Ironically for a battle over a enormous quantity of cash, Hohn mentioned his life’s mission was to provide cash away. “My life is actually is about charity,” he instructed the courtroom. “I learned very early on you cannot take money with you. It does not bring you happiness.”
He mentioned he lived a “very simple lifestyle”, avoids meat and practices yoga. On listening to the proof, the choose famous that the couple lived a “Swatch lifestyle” not a “jet-set lifestyle”.
Hohn grew up in Addlestone, Surrey, the son of a Jamaican automotive mechanic and a authorized secretary. He first determined to provide cash to charity, he has mentioned, whereas working in the Philippines, the place as a 20-yr-outdated he noticed kids residing on a garbage dump.
“I considered being a doctor and working in a caring profession,” Hohn, 54, instructed the courtroom. “[But] a dream or aspiration without resources is just that.” He in contrast his ambition to develop into a philanthropist to different younger individuals who set their hearts on with the ability to “play for Chelsea or be a top QC”.
Hohn studied accounting and economics at Southampton University, the place a tutor urged he go on to check for a masters in enterprise administration at Harvard. He took their recommendation, and graduated in the prime 5% of his class.
It was at a Harvard feast that Hohn met Jamie Cooper, who was learning for a masters at the John F Kennedy School of authorities. They married quickly after and took one another’s names formally, however solely Jamie used each surnames. They have 4 kids, together with a set of triplets.
Hohn labored for the private fairness agency Apax Partners, earlier than shifting to the Wall Street hedge fund Perry Capital. Perry’s companions then posted him again to London the place he ran the UK division.
He struck out on his personal in 2003 organising his personal $500m fund TCI, which rapidly attracted funding from some of the world’s prime foundations and endowments together with the Carnegie Corporation of New York and the Massachusetts Institute of Technology.
The fund appealed to charities and foundations as a result of it was structured in order that one-third of administration charges would go on to the Children’s Investment Fund Foundation, a charity arrange by the couple and run by Cooper-Hohn.
In an interview with the New York Times to advertise the newly launched charity in 2008, Cooper-Hohn dismissed recommendations it had been arrange as ploy to melt Hohn’s picture as an activist investor unafraid to battle the boards of firms he had invested in.
In a New Year card to household, Hohn as soon as wrote he had had an“exceptionally exciting year overthrowing German CEOs”. One opponent – former Deutsche Börse boss Werner Seifert – was so indignant after dropping a boardroom battle with Hohn that he wrote a e-book about it entitled Invasion of the Locusts, the place he described Hohn’s type as “poison”.
Hohn’s TCI was additionally instrumental in forcing Dutch financial institution ABN Amro into the arms of Royal Bank of Scotland in 2007 – a deal which simply months later, when the banking disaster hit, was a key motive RBS needed to be bailed out by the UK taxpayer.
Cooper-Hohn mentioned the basis “not about putting a warm and fuzzy face” on TCI. She mentioned realizing that a share of the administration charges went to the fund was “very much about keeping Chris motivated” to provide the highest returns doable.
Both TCI and the basis flourished. The hedge fund now manages $30bn of investments and is repeatedly listed amongst the world’s finest-performing funds. Last yr’s mega payday was not that distinctive for Hohn. The earlier yr he was paid £200m, and accounts filed at Companies House for TCI Fund Management (UK) Limited, which is 100% owned by Hohn, present that it holds whole shareholder funds of virtually $2bn.
The charity holds virtually $6bn of property and gave away $386m in 2019, in line with the latest available accounts. However, the basis not collects one-third of TCI’s administration charges, following the couple’s divorce. Instead, Hohn can provide to the charity at his discretion.
The divorce reached the excessive courtroom after Hohn refused to provide Cooper-Hohn half of their property, arguing that the extraordinary wealth he had generated constituted a particular contribution to the marriage. He claimed she was solely entitled to 25%.
Her lawyer mentioned the marriage was “what most marriages are: a partnership. How can it be possibly be fair that a couple who have agreed how to run their lives together for the wife to only receive a quarter of the assets?”
After weeks of arguments – which included Hohn calling Goldman Sachs bankers “idiots” and describing former Spain and Chelsea striker Fernando Torres as “worthless” – the choose awarded Cooper-Hohn 36% – or $530m – of her former husband’s fortune.
Cooper-Hohn later gained one other courtroom battle forcing Hohn’s CIFF charity to pay £270m to a charity set up by his ex-wife.