The Italian association of pension funds for professionals, Adepp, and its German counterpart – Arbeitsgemeinschaft berufsständischer Versorgungseinrichtugen (ABV) – have called for a European regulatory framework that would improve transparency for private market investments, specifically venture capital (VC), and investments in small and medium-sized companies (SMEs).
Investment in venture capital and in SMEs are currently too risky for first pillar pension schemes in Italy and Germany, Adepp’s deputy chair Tiziana Stallone, and ABV’s president Rudolf Henke said during an event organised by both associations last week on responsible investing in support of the European economy.
The associations, representing pension schemes with over €400bn in total assets, are considering supporting allocation increases to such investments to support the real economy in Germany and in Italy through private market investments.
Italy’s first pillar schemes will increase investments in the real economy if they see taxes on investment returns decrease, while ABV is in favour of easing up rules for much-needed infrastructure investments in Germany.
First pillar pension schemes in Italy support the real economy by investing in energy group Enel, in postal service company Poste Italiane and in banks including Intesa Sanpaolo, Banca Popolare di Milano, Mediobanca and Bank of Italy.
The associations are demanding a framework for private market Investments in Europe that must guarantee the financial sustainability of their institutions for the next 30-50 years, they said during the event in Brussels.
They have also highlighted the need for a common, stable framework on risk calculation and reporting systems that would help first pillar schemes in Germany and Italy have a sustainable financial footing, and improve transparency on VC and SMEs investments.
Adepp and ABV have strengthened international cooperation in recent years to influence the legislative process at European Union level.
They also aim to continue dialogue with the EU to encourage the integration of social goals into investment strategies to support the European economy, Stallone said at the event.
First pillar schemes in Italy consider social aspects when investing in companies with inclusive working practices, in social bonds, in projects improving access to care and education, and in affordable housing, among others.
“The concept of social investment is part of our mission, that is to guarantee benefits to members. Professionals carry out tasks in strategic areas of society, from the healthcare sector to accounting, and act as intermediaries between the state and citizens,” Henke said.
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