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December 16, 2021

New research reveals top strategic priorities of global pension fund executives

New research, commissioned by SimCorp and Deloitte, and conducted by Institutional Investor, “Global Pension Investment Trends” reveals that nearly three out of five global pension funds (58%) expect to increase their ESG portfolio exposure by 20% or more, while more than three out of four (78%) say they struggle to achieve a holistic view of ESG and other investments across all asset classes.

The study makes clear that large pension funds across the world are encountering several challenges and opportunities from mounting ESG pressures, shifting industry standards and stakeholder concerns, and vast increases in data needs. It also confirms that achieving a holistic portfolio overview that includes ESG, private markets, and other investments across all asset classes, is a top priority for most pensions.

Christian Kromann, Chief Executive Officer at SimCorp, commented: “Having a holistic view of their total portfolio is essential for pension funds to react quickly to market changes. We see a common trend in increasing ESG investments and are therefore dedicated to supporting our clients to better manage this market shift.”

The findings from the report aligns closely with SimCorp’s strategic offering to take responsibility for data clean-up, and increase the development of strong ESG solutions to match the new found regulatory and market needs.

The report explores four key themes that have emerged from the survey findings:

  • Pensions seek to retain internal control of their asset management while outsourcing their “non-core” IT, data management and operational needs.
  • Pensions managers are adapting to increasing ESG commitments, and the challenges and opportunities they bring.
  • Investment decision makers have growing interest in private market investments but are hindered by operational challenges.
  • Pensions often struggle with data management limitations and in response they’re making technology upgrades a top priority.

Hilde Jenssen, Head of Fundamental Equities at Nordea Asset Management, commenting on the survey findings, said: “…we think the key challenge for investors will be data availability to comply with EU regulatory framework. At the same time, as active fundamental equity investors, we are constantly looking for companies that are mispriced for various reasons. ESG data may be one of these reasons and hence create investment opportunities. In the long term, scalability of the ESG investment process may be a key challenge.”

The report is based on a survey of more than 135 investment, operations, and technology decision makers at public and private pensions across North America, Europe, and Asia-Pacific with $10 billion or more assets under management and explores the key issues pension funds are facing today.

For more information and to read the full report, see here.

About SimCorp

SimCorp provides integrated, best-in-class, multi-asset investment management solutions to the world’s leading asset managers, fund managers, asset servicers, pension and insurance funds, wealth managers, central banks, sovereign wealth funds and treasury. Deployed on-premise or in the cloud, SimCorp’s core solution, SimCorp Dimension®, alongside SimCorp Coric®, SimCorp Gain™ and SimCorp Sofia™ form a powerful and complete solution. Together with a range of managed services, they support the entire investment life cycle, based on a market-leading IBOR. SimCorp invests around 20% of its annual revenue in R&D, helping clients develop their business and stay ahead of ever-changing industry demands. Listed on Nasdaq Copenhagen, SimCorp is a global company, with regional offices across Europe, North America, and Asia Pacific. For more information, please visit www.simcorp.com.

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