SPP member, event panellist and Mercer Workplace Savings head of investment strategy Jane Walker
Nearly 90% of defined contribution (DC) schemes are either “minimally” or “not at all” involved in private market investment, a poll by the Society of Pension Professionals (SPP) finds.
The survey – conducted at the SPP's event, How all DC Schemes can Invest in Illiquid Assets, on Tuesday (15 July) – asked attendees to what extent the DC schemes they advise were currently involved in private market investment.
Some 73% said they were minimally involved, 15% responded that they were involved to a reasonable degree and 12% answered that they were not at all involved.
The poll comes as the government is increasingly encouraging DC pension scheme investment in illiquid assets and follows the announcement that 17 pension providers had signed the Mansion House Accord in May – expressing their intent to invest at least 10% of their DC default funds in private markets by 2030, with at least 5% allocated to the UK.
It also follows the publication of the Pension Schemes Bill last month.
The SPP's event featured senior industry professionals from The Pensions Regulator, Mercer, Aon and Independent Governance Group, who looked at some of the key challenges and opportunities of investing in illiquids.
Despite the low level of DC involvement with private markets currently, attendees at the SPP event viewed private market investment for the DC schemes they advise positively.
In a separate poll question, more than three quarters of respondents (76%) answered that private markets was something trustees should seriously consider for many or all schemes, 19% stated it was something that was an occasional opportunity and only 5% concluded that private market investment was not suitable.
SPP member, event panellist and Mercer Workplace Savings head of investment strategy Jane Walker said: "This was an illuminating event that really delved into the nuts and bolts of private market investment, which despite its challenges clearly represents a sizeable opportunity for many schemes.
"The wider industry appears to agree, with nearly all of those polled stating this was something that represents either a serious opportunity for many schemes or at least an occasional opportunity."
