December 2020

29Dec

Time is now for Canada’s public pension giants to invest in a safe climate future

As 2020 came to a close, the federal government made laudable plans to cut carbon pollution faster and deeper. But we haven’t seen similar commitments to climate action from a massive pool of capital over which Canadians have real power: our pension funds. Canada’s 10 largest public pension funds alone manage nearly $1.8 trillion — an amount approaching the size of the country’s annual GDP. These pension giants own sizable pieces of the real economy and hold significant shares...

December 29, 2020
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23Dec

OECD warns against using pension assets for ‘pet projects’

The OECD has warned governments against tapping into private pension assets for “pet projects” as nations look to retirement scheme cash to help drive the post Covid-19 economic recovery. Read also ESMA advises fresh postponement of pension fund central clearing duty Trustees of pension schemes in the UK have a duty to act in the best interests of members, but in spite of their investment freedoms, their portfolios predominately invest in equities and bonds. Read also US. Workers Tap Retirement...

December 23, 2020
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23Dec

Four Italian pension funds unite for major push into private debt

Four Italian pension funds have combined their efforts to find an alternative investment manager to oversee mandates related to private debt. The funds – Fondo Gomma Plastica, Fopen, Pegaso and Previmoda – have a total of €195m in commitments, which will result in a core strategy or unitranche corporate direct lending, with other strategies being added residually. The group said the tender, known as the Zefiro Project, will focus mainly on the European Economic Area with particular attention on...

December 23, 2020
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22Dec

Japan. GPIF Invests $12.5 Billion in Morningstar, MSCI ESG Benchmarks

The Government Pension Investment Fund (GPIF) in Japan has started investing $12.5 billion into two foreign environmental, social, and governance (ESG) benchmarks from US index providers Morningstar and MSCI. Read also US. Saving at Work for Retirement: A Perk Coming to More States in 2021 The Japanese pension allocated roughly $9.7 billion to a general ESG-themed index from MSCI, as well as $2.9 billion to a gender diversity-themed index from Morningstar, the fund said Friday. Respectively, the two benchmarks...

December 22, 2020
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22Dec

US. Calpers Seeking an Investment Chief With Staying Power

The nation’s largest public pension fund has a retention problem, an especially pressing issue given the deep hole it and other retirement plans are in. The California Public Employees’ Retirement System has burned through six chief investment officers over the past two decades. Its most recent investment chief, Ben Meng, lasted just 19 months. His tenure ended this summer in the midst of questions about whether his personal investments created a conflict of interest. Elsewhere, investment chiefs stay for...

December 22, 2020
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17Dec

UK. Canadian pension fund takes control of Trafford Centre

A pension fund has taken control of the Trafford Centre after administrators received "no viable bids" for it. The shopping centre, which attracts about 30 million visitors a year, went up for sale in August after owner Intu Properties (IP) entered administration. Canada Pension Plan Investment Board (CPPIB), a key lender to IP, has taken ownership as the principal creditor. CPPIB's Geoff Souter said despite "challenging" retail conditons, the centre still had "strong prospects". The Canadian fund had provided...

December 17, 2020
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16Dec

US. Stock Market Gains Help Pension Funding Levels: Pension and Group Annuity Update

Corporate bond interest rates fell a little in November, but the stock market did well, and that helped make the finances of big U.S. corporate pension plans look better, according to Milliman Inc. Zorast Wadia and Charles Clark, analysts at the Seattle-based actuarial consulting firm, found that the 100 large corporate pension plans they track reported a $272 billion combined deficit in November on $1.98 trillion in pension benefits obligations, compared with a $284 billion deficit on $1.915 trillion...

December 16, 2020
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10Dec

Aging China Must Work Longer and Invest Smarter

China is getting older. That means the Chinese people will have to work longer. But deeper reforms will also be necessary to ensure income growth doesn’t stagnate. Read also Asset management CEO arrested in Taiwan pension fund scandal The world’s most populous country has begun aging rapidly over the past decade, but the pace is going to pick up even more as tens of millions reach retirement age. The working population—people between the ages of 15 and 59—will drop by...

December 10, 2020
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09Dec

Pension funds increasingly require ESG compliance; here’s why they should look to Africa

The Scottish Widows Fund recently announced that it will dump £440m of company holdings that fail its Environmental, Social, and Governance (ESG) tests. Being one of the most far-reaching exclusions policies adopted by a major UK pensions provider to date, it’s important to take note of this action. And as pension funds and asset managers across the world face increasing pressure to protect client portfolios from the risks of climate change, others will follow. Read also South Africa. Sustainability...

December 9, 2020
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09Dec

Is There a Place for ETFs in Retirement Plans?

Millennials favor exchange-traded funds (ETFs) more than other generations, according to a report by Charles Schwab about trends in retirement plan self-directed brokerage accounts (SDBAs). Millennials are a considerable portion of the U.S. workforce, The low cost of ETFs is often cited as a positive feature of the funds. Yet, even as retirement plan fees are driven down and have been the subject of much litigation, ETFs have not been widely accepted by defined contribution (DC) plan sponsors. Tom Skrobe,...

December 9, 2020
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