December 2023
01Dec

Augmenting the Funded Ratio: New Metrics for Liability Based Plans

By Sanjiv Ranjan Das, Daniel N Ostrov, Anand Radhakrishnan, Deep Srivastav & Wylie Tollette The primary metric used to determine the health of a liability based plan (LBP) is the funded ratio, which is the ratio of the LBP’s current assets to its present-valued liabilities. The funded ratio, however, cannot accommodate a considerable number of important financial factors, so we suggest three additional metrics of financial health, each connected to the probability of fulfilling the plan’s liabilities. The first two...

December 1, 2023
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01Dec

Australia pension funds call for reforms to encourage green energy investment at home

Australian pension funds called on Friday for the government to enact reforms that would make it easier to invest in domestic renewable energy projects and warned that without action investors would opt for more compelling overseas projects. Australia's electricity transmission network, batteries and sustainable aviation fuel are three areas where simplified planning, subsidised finance and other regulatory changes could catalyse investment, according to a report released by eight major pension funds. Changes could quickly unlock A$4 billion ($2.7 billion) worth of...

December 1, 2023
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01Dec

Nordic pension funds invest more in UK start-ups than British counterparts

Nordic pension funds are now investing more in UK start-ups than their British counterparts, research by Atomico has found. As reported by our sister title, European Pensions, the State of European Tech report found that pension funds from Denmark, Finland, Iceland, Norway and Sweden collectively contribute USD 88m to UK start-ups, compared to USD 49m from the UK and Ireland combined. In addition, the report found that generally UK pension funds only represent 5 per cent of funds committed to venture...

December 1, 2023
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November 2023
30Nov

UK. Stop funding fossil fuels, ‘The Crown’ star urges pensions in ad

It's a curious combination: celebrities and pension funds. Rarely do the two mix, but when they do, they often make the news. A new advert, launched earlier this week, featuring Oscar-winning actress Olivia Colman, called on UK pension members to lobby their funds to cut fossil fuels investments. “The cash from your pensions has helped us dig, drill and destroy more of the planet than ever before,” she says in the advert. Posted on YouTube and the group’s website, among other platforms,...

November 30, 2023
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29Nov

60% in the UK is risk of lower living standard in retirement due to low contributions

Research from Gresham House, the specialist sustainable investment manager, has revealed that 60 per cent of people in the UK are at risk of having a sub-standard of living in retirement due to low pension contributions. To ensure more people put aside money for retirement, the government and pension providers must highlight the benefits that contributing can have. According to Gresham House, 69 per cent of 16- to 35-year-olds said they would support their pension fund adopting a place-based impact investing approach....

November 29, 2023
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27Nov

Pension funds have lost market share among 100 largest asset owners with $23T AUM

The 100 largest asset owners in the world saw their assets under management decline by 9% by the end of 2022 compared to the previous year, but still controlled more than $23 trillion in assets. But who are they? Five years ago, pension funds were in pole position, holding 60% of AUM among the top 100 owners at the time. But relative investment performance – with a slower correction in their collective assets – and new inflows means sovereign wealth funds have...

November 27, 2023
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27Nov

Australian pension fund makes £5.25bn commitment to UK

Calls for UK pension schemes to invest more in the economy have been renewed following the news that Australian pension fund, Aware Super, is looking to direct a A$10bn (£5.25bn) investment commitment in the UK and Europe. Announcing the investment at the Global Investment Summit, Aware Super said that it has plans to expand its assets under management, with international expansion into the UK a key strategy aimed at achieving that goal. The fund, which officially opened its first international office...

November 27, 2023
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27Nov

Nigeria. N130bn pension fund invested in infrastructure – PenCom

Pension Fund Administrators invested N130.18 billion funds under the Contributory Pension Scheme in infrastructure as of the end of September 2023. Figures obtained from the National Pension Commission on ‘Unaudited report on pension funds industry portfolio for the period ended 30 September 2023- Approved Existing Schemes, Closed Pension Fund Administrators and RSA Funds (Including unremitted contributions @CBN & legacy funds’, revealed. According to the figures, total assets under the CPS stood at N17.35tn as of the period under review. Part of the...

November 27, 2023
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24Nov

Retirement Planning: The Volatility-Adjusted Coverage Ratio

By Javier Estrada  The important decisions that retirees have to make to try to achieve their financial goals during retirement often stem from models used by financial planners. Despite the important role it plays in many of those models, the failure rate has several limitations and many alternatives have been proposed. This article introduces a new metric, the volatility-adjusted coverage ratio, which incorporates the benefit (the coverage ratio) and the cost (the volatility of the portfolio) of the strategies considered....

November 24, 2023
Articles, Pension design, ,
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24Nov

ESG and Public Pension Investing in 2023: A Year-To-Date Recap and Analysis

By Joshua Lichtenstein, Michael Littenberg & Reagan Haas Since 2021, Ropes & Gray has been actively tracking the various approaches states have taken on how or whether environmental, social and governance (ESG) factors should be applied to the investment decisions for public retirement systems. States have used legislative, administrative and enforcement mechanisms to address this area, which has been complemented by Congressional Republicans’ various attempts to shine a spotlight on ESG in recent months. Judging by the significant uptick in...

November 24, 2023
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