Largest asset owners are critical to aiding society’s biggest issues

Wednesday, 13. November 2019 16:40

ARLINGTON, Va., Nov. 13, 2019 (GLOBE NEWSWIRE) -- The Asset Owner 100 (AO100) — the world’s 100 biggest asset owners — account for $19 trillion, up 1.7% from last year, according to research from the Thinking Ahead Institute. In its second study of the AO100, the Thinking Ahead Institute highlights the unique position universal owners have to direct capital in a sustainable way, making a significantly positive impact on issues, including climate change.

“The major investment markets failed to make progress in 2018 around their equity and bond returns, but these funds, in many cases, were able to avoid losing ground against their longer-term targets by sensible diversification — in particular, into private markets,” said Roger Urwin, global head of content at the Thinking Ahead Institute.

“The 100 largest asset owners are responsible for over 35% of all global asset owner capital. Of these, there are a number of self-declared universal owners that are large-scale, long-term and leadership-minded funds that own a slice of the whole world economy. This makes them pursue an influential role in safeguarding the financial system and contributing positively to certain big societal issues without compromising on their financial responsibilities. They have no choice but to take seriously their responsibilities and lead from the front,” Urwin adds.

The Thinking Ahead Institute’s analysis found that 59.1% of AO100 assets are held by pension funds, decreasing by 1.7% in 2018; 33.5% are held by sovereign wealth funds (SWF), increasing by 1.5% during the year; and 7.4% by outsourced chief investment officers and master trusts, increasing by 0.2%. Asia Pacific remains the largest region in terms of AUM, accounting for 36.1% of assets in the ranking. EMEA and North American assets represent 32.3% and 31.6%, respectively.

“During 2018 there were a number of sustainability initiatives by universal owner funds that involved ‘doing good while doing well.’ This marks the start of a movement in which funds support societally beneficial initiatives consistent with financially sound fiduciary principles. GPIF, the Japanese fund and largest asset owner in the world, is at the center of a number of these initiatives,” said Urwin.

“Asset owners face lower expected returns in the future, and the success with which they meet their targeted returns will be dependent on how well they adapt their investment model to integrate sustainability considerations such as environmental, social and governance-related investment opportunities,” said Marisa Hall, director at the Thinking Ahead Institute. “Global best practice on sustainability for asset owners is on an upward trajectory, but it still has a long way to go.”

The top 20 funds total US$10.55 trillion and represent 55.5% of AO100 assets.

Top 20 asset owners (in US$ million)

Rank Organization Country Total AssetsCategory
1Government Pension InvestmentJapan$1,374,499Pension Fund
2Government Pension FundNorway$982,293Pension Fund
3China Investment Corporation1China$941,420SWF
4Abu Dhabi Investment Authority1UAE$696,660SWF
5Kuwait Investment Authority2Kuwait$592,000SWF
6Federal Retirement ThriftU.S.$578,755Pension Fund
7National PensionSouth Korea$573,259Pension Fund
8Hong Kong Monetary Authority Investment Portfolio2Hong Kong$509,353SWF
9SAMA Foreign Holdings2Saudi Arabia$505,755SWF
10ABPNetherlands$461,682Pension Fund
11SAFE Investment Company2China$439,837SWF
12GIC Private Limited2Singapore$390,000SWF
13California Public EmployeesU.S.$376,859Pension Fund
14Temasek Holdings2Singapore$374,896SWF
15National Social SecurityChina$325,002Pension Fund
16Qatar Investment Authority2Qatar$320,000SWF
17Public Investment Fund/ Sanabil Investments2Saudi Arabia$290,000SWF
18Canada Pension2Canada$287,410Pension Fund
19Central Provident FundSingapore$286,963Pension Fund
20PFZW2Netherlands$248,326Pension Fund

1 As of May 31, 2019
2 As of December 1, 2018

About the Thinking Ahead Institute

The Thinking Ahead Institute was established in January 2015 and is a global not-for-profit investment research and innovation member group made up of institutional asset owners and service providers committed to changing and improving the investment industry for the benefit of the end saver. It has over 40 members around the world and is an outgrowth of Willis Towers Watson Investments’ Thinking Ahead Group which was set up in 2002.

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Ed Emerman: +1 609 275 5162

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