'The world is awash in cash – we can invest it to make Britain better,' says outgoing L&G boss Nigel Wilson

On a stormy day on Tyneside, Sir Nigel Wilson is in his element. The Legal & General boss visits the Newcastle Helix, a £350 million urban redevelopment he helped finance.

Wilson, who grew up on a council estate in nearby Newton Aycliffe, is set to step down after more than 11 years at the top of L&G.

Before he goes, he would like to praise the Helix project, which he delivered with Newcastle University and the city council.

Under his leadership, L&G, which manages £1.2 trillion of pensions and savings, has become Britain's biggest investor.

He sees himself as a pioneer of 'inclusive capitalism' and the Helix, on the 24 hectare site of the old Newcastle Brown Ale brewery, is a concrete example of this.

From 1927 to 2005, the heady smell of hops wafted from behind its high walls, but now it is being reinvented as a science and business park. The hope is that it will boost the local economy by £960m and create 4,000 jobs.

The British economy has suffered from short-termism. But Wilson, 67, says he has been able to make these types of long-term investments because he has been at L&G for much longer than the typical FTSE 100 CEO.

“If you think about all jobs in public life, whether it's in politics or business, tenure is very short-lived,” he says.

'Look at housing: we have had fifteen to sixteen ministers in the past ten years. It's not long enough to make a dent. It would be much better if we had ministers who knew something about their areas.'

Wilson is backing another development a few miles away, to create Britain's first 'health innovation neighbourhood' in a 29-hectare area around the old Newcastle General Hospital.

The idea is for it to become a 'living laboratory', where university researchers will work with local residents to help them stay healthier and happier as they age.

'L&G is the glue that holds everything together. We are the doers who make things happen. We provide money so you don't have to wait for handouts,” Wilson said.

'Preventive healthcare is hardly done on scale. We hope that the North East can be an example.'

Thanks to the money and connections at his disposal, he and L&G have arguably more influence on reshaping our urban landscape than most politicians.

'We have invested over £1 billion in the North East, if you include Leeds. We are probably the biggest investor in Britain,” he says.

The investment drive is not only taking place in the Northeast. Wilson has plowed money across the country, with around £30 billion in more than 26 locations, including Cardiff, Sheffield and the West Midlands.

His philosophy of “inclusive capitalism,” he says, is about realizing projects that are both socially useful and profitable.

The theory is that a virtuous circle is created. Savers see their retirement contributions going into things like health research or affordable housing that directly benefits their communities.

This, Wilson argues, delivers long-term financial returns and also gives people an incentive to save for retirement.

Social objectives are all very well, but shouldn't L&G just focus on chasing the highest profits?

“We think it makes economic sense to try to solve meaningful problems and make money at the same time,” he says.

'We have had a return on equity of 20 percent for a long time, which is exceptional in the financial services industry. You get returning and new customers because people trust you to do the right things. So it also works economically.'

One of his secrets, he says, is to be “really resilient.” 'Every day something goes wrong in this job and it ends up on your desk. You have to recognize that this is business. Be honest with yourself about your own mistakes.'

L&G has had difficult periods during his reign, including a hit to its share price last year due to the Liability Driven Investment (LDI) meltdown that followed the Liz Truss mini-budget in 2022.

The firm was one of the largest providers of LDI strategies and Wilson admitted to being 'caught off guard' by the tension in the market.

L&G shares have performed strongly since he took over and the company has been an attractive dividend payer. However, last year's performance was disappointing.

In addition to the sale of insurance and pension schemes, the group is the market leader in the field of 'pension risk transfer'.

These are deals in which employers transfer their pension plans to insurance companies because they no longer want to bear the potential liabilities.

This is a potentially lucrative business for insurers as rising interest rates have made it easier to close deals. L&G recently agreed a £4.8 billion buy-in with the Boots pension fund, the largest risk transfer in Britain to date.

Cautious people will point out that this is a fast-growing, capital-intensive area where regulations are evolving. And in the world of pensions, history teaches us that things can always go wrong.

As for Wilson's next step, inclusive capitalism sounds like something that could appeal to the more moderate elements of the Labor Party.

Has he joined other businesspeople advising leader Sir Keir Starmer and shadow chancellor Rachel Reeves? “I am very happy that I can help all parties,” he says diplomatically.

As for a new career in politics, he claims he really hasn't decided yet what he will do next, but will take time to think about it.

If he were chancellor at the Budget in March, he says he would introduce pension reforms to encourage major British pension funds to invest more in Britain, and he would pursue more foreign direct investment.

'The world is still awash with money to invest. We want as many people as possible to do better, and that means we have to make a choice in how we use the capital we have and the capital we attract.

At a societal level, we have underinvested in housing, health inequalities have increased, real wages have fallen and as a result people are living less happy and prosperous lives.'

'We need ten Legal & Generals to make a difference.'

That raises a very interesting question: why don't other companies copy L&G? Do his rivals simply lack vision and energy, or has Wilson become too much of a social evangelist?

Whatever the answer, his drive to improve lives in disadvantaged areas is relentless.

In the new year he will hand over the reins to Antonio Simoes, a director at Santander bank. Won't it be hard to leave everything behind?

'I worked seven days a week for years and I don't want to do that anymore.

“I don't want to be a backseat driver. L&G can make things happen, but I believe I can keep making things happen.”