Treasurer Jim Chalmers announced Mr Combet would serve as the next chair of the Future Fund for a five-term.
Mr Combet's appointment comes following the resignation of former chair and former federal Liberal treasurer Peter Costello, after 14 years on the Future Fund board.
"Greg Combet has extensive experience in investment and superannuation as well as government and the climate and energy transformation in particular," Dr Chalmers told reporters in Canberra on Monday.
"What we've been able to do here is ensure that we can renew and refresh a really important economic institution with an appointment of this calibre."
Mr Combet was climate change minister under former prime minister Julia Gillard.
He was also a member of the executive board of the national COVID-19 coordination commission.
It's expected he will take up the position of Future Fund chair in the middle of 2024.
Former Macquarie banker Mary Reemst will serve as the acting chair until Mr Combet starts in the role.
The Future Fund was set up in 2006 to strengthen the nation's long-term financial position and cover public sector superannuation liabilities.
Its portfolio has grown steadily since its inception and is now worth more than $200 billion.
It has delivered an average annual return of 8.8 per cent per annum over the past decade.
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