The UK workplace pension scheme NEST anticipates having £20bn (€23.7bn) invested in the UK by the end of the decade, as it commits to publishing a quarterly report on how the scheme’s money is invested in the domestic market.
The move comes after research conducted by the £40bn pension scheme revealed that the majority of its members (70%) wanted more information about how NEST invests in the UK, with 75% either being unsure or underestimating the current levels of UK investment in their pension pots.
More than two-thirds (69%) of members were interested in where in the world their money was invested.
As a result, NEST will be publishing a quarterly summary of how this money is invested in the UK, just like it does with investment performance.
It said it already has around £8.5bn invested in a “variety of ways” in the UK economy, from supporting infrastructure projects to lending to growing UK businesses.
Speaking to IPE at the beginning of the year, Stephen O’Neill, head of private markets at NEST, said the scheme’s private market allocations, including real estate equity, sit at nearly 20% and the scheme is close to reaching its 5% private equity target it committed to under the Mansion House Compact, which calls for a 5% investment in UK unlisted equity by 2030.
Ian Cornelius, chief executive officer of NEST Corporation, said the UK is already a major market for the asset owner with a fifth of its investment based right here.
“More than a third of the UK workforce has a pension pot with NEST and we want to help invest in their jobs, their communities, and the things they rely on, like roads and bridges,” he said.
“I am pleased NEST is taking this significant step in providing our members with a clear understanding of how their hard-earned contributions are being invested in the UK. We welcome the opportunity to promote how carefully we look after our members’ money and showcase our UK investments to our members,” he continued.
Cornelius added that it is clear from NEST’s research that its pension savers want to know where their money is being invested.
“We hope this step we’re taking towards further transparency encourages others in the wider pensions industry to adopt this practice – in advance of the value for money measure being in place,” he noted.
Mark Fawcett, CEO of NEST Invest, added that pension funds should be looking hard for UK investment.
“One of the world’s biggest economies is right here on our doorstep and it’s an attractive place to do business. It allows us to support local businesses and infrastructure projects, fostering economic growth and job creation.”
He added that investing in the UK aligns with NEST’s investment strategy and its long-term goals of sustainability and stability.
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