January 2025

US Pension Plan Managers Split on Primary Benefit of Private Assets

As an increasing share of pension funds increase their allocations to private markets, plan managers are split on the benefit these assets have in their portfolio. Most pension fund executives also expect distributions from private equity, which have been lower in recent years, will increase over the next three years. According to a survey from Ortec Finance B.V., which interviewed pension fund executives in the U.S. about their expectations for the next three years, approximately 74% said they expect higher...

US. Pension funds push once again for private equity transparency

Pension funds and other institutional investors are pressing private-equity firms to provide more standardized reporting on fees and investment performance, reflecting long-standing frustration over inconsistent and opaque disclosures. Citing sources familiar with the matter, the Wall Street Journal reported that the Institutional Limited Partners Association, a trade group representing pension plans such as the California Public Employees’ Retirement System and the State of Wisconsin Investment Board, recently proposed new guidelines aimed at improving transparency in the private-equity sector. According to the Journal, those guidelines...

China moves to boost languishing markets by ordering funds to invest more in shares

The Chinese government is trying to encourage people to spend more by ensuring that share prices will rise, ordering pensions and mutual funds to invest more in domestic stocks to help jolt its languid markets out of the doldrums. Officials told reporters in Beijing on Thursday that beginning this year mutual funds should increase holdings of onshore stocks, called A-shares, by at least 10% a year over the next three years. Commercial insurance funds will have to put 30% of their...

South African ban on cryptocurrency for pensions in the crosshairs

As the value of cryptocurrencies, particularly Bitcoin, continues to rise internationally, there have been growing calls for South African pension funds to be allowed to invest in cryptocurrencies. Currently, Regulation 28, which governs where pension funds can invest, tightly restricts their investment options. Proposals suggest amending this regulation to include cryptocurrencies, which could have significant implications for the industry and investors. Farzam Ehsani, co-founder and CEO of major South African cryptocurrency exchange VALR, said South Africans deserve nothing less than to lift...

UK. The People’s Pension exploring private markets with plans to allocate up to $4.9 billion

The People's Pension, Crawley, England, is taking steps to allocate up to £4 billion ($4.9 billion) to private markets assets by 2030, and also plans to hire a specialist and set up a dedicated research capability. The defined contribution master trust had £31 billion in assets as of Dec. 31, and expects to reach £60 billion by 2033. This allocation will mark The People's Pension's first foray into private markets, as confirmed by a spokesperson for the fund. While it did...

Advocates claim high-risk gas assets are liabilities for pensions

Adam Scott believes pension fund managers who invest in gas are in trouble. Particularly, those who think high-risk gas assets can be saved by hydrogen. This might come as a shock because pension fund managers have long seen gas infrastructure as a low-risk investment. Historically, regulated gas assets offered stable returns and seemed to be a safer, lower-carbon option compared to other fossil fuels. But Scott, executive director at Shift Action for Pension Wealth and Planet Health, says these...

Bank of England warns billions of pounds in UK pension pots at risk

The UK's main financial regulator has told insurance companies it can foresee an "endemic risk" in using insurance cash from foreign companies to pay out pensions. In an advisory notice sent out to insurance companies last week the Bank of England said it was concerned about an increase in the growing use of a type of insurance known as funded reinsurance. Gareth Truran, executive director and Shoib Khan director, said there was a risk with this type of funding and that...

​Sweden. KPA calls for action on pensions investment in local climate adaptation

KPA Pension, which manages pensions for local authorities, said action needs to be taken to improve the framework for pension funds to invest in climate change preparedness in Sweden, arguing that most scheme members favour their savings being invested in that way. The SEK300bn (€26bn) pension fund, a subsidiary of pensions and insurance group Folksam, published a report on Friday on Sweden’s need to undergo the green climate transition, adapt society to a changing climate and to build civil preparedness...

CPP Investments enters joint venture with Brazil’s largest residential real estate developer

Canada Pension Plan Investment Board (CPP Investments) has entered a joint venture with Cyrela Brazil Realty (Cyrela), Brazil's largest residential real estate developer. The agreement targets the development of residential condominiums in São Paulo, Brazil's largest city, with Cyrela's fund management subsidiary, Cy.Capital, serving as the manager of the investment vehicle. The partnership has established an investment target of $400m, split equally between CPP Investments and Cyrela. The venture aims to deliver over $1.44bn in potential sales value in the coming...

Europe’s top pension fund divests $585 million stake in Tesla

Europe's largest pension fund, Stichting Pensioenfonds ABP, has sold off its entire stake in Tesla (NASDAQ:TSLA) Inc., valued at $585 million, during the third quarter. The decision was influenced by several factors, including a disagreement over CEO Elon Musk's compensation package. Stichting Pensioenfonds ABP spokesperson stated on Sunday that the fund had issues with Musk's pay package. The decision to divest was also influenced by considerations of costs, returns, and responsible investment requirements. The Dutch newspaper Het Financieele Dagblad originally reported...