World’s largest pension funds return to growth
Rhea-AI Summary
The Global Top 300 Pension Funds report by WTW's Thinking Ahead Institute reveals a 10% increase in assets under management (AuM) for the world's largest pension funds in 2023, reaching $22.6 trillion. This growth erased much of the 13% decline experienced in 2022. The top 20 funds outpaced their smaller peers with a 12% increase in assets and a 5.4% compound annual growth rate over five years.
Japan's Government Pension Investment Fund remains the largest globally with $1.59 trillion AuM, closely followed by Norway's Government Pension Fund at $1.58 trillion. The report highlights regional differences in asset allocation and fund types, with defined benefit funds dominating in North America, Asia Pacific, and Europe.
Positive
- Assets under management for top 300 pension funds increased by 10% to $22.6 trillion in 2023
- Top 20 largest pension funds recorded a 12% increase in assets, outpacing smaller peers
- Top 20 pension funds show a 5.4% compound annual growth rate over the past five years
- Defined benefit funds account for 61% of total disclosed AuM
Negative
- Assets of the largest pension funds are still not back to their record highs
- Increasing complexity in the investment landscape due to uncertain macroeconomic environment and geopolitical instability
- High volatility persists in the global economy
- Asset management industry's net-zero commitments are not yet fully formed
News Market Reaction
On the day this news was published, WTW gained 1.12%, reflecting a mild positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
NEW YORK, Sept. 09, 2024 (GLOBE NEWSWIRE) -- The world’s largest 300 pension funds returned to growth in 2023, erasing much of the decline of the previous year. However, the assets of the largest pension funds are still not yet back to their record highs, according to this year’s Global Top 300 Pension Funds report by leading global advisory, broking and solutions company WTW’s Thinking Ahead Institute.
The research highlights high-level trends in the pension fund industry and provides information on the changing composition of the top 300 list of pension funds globally, including the characteristics and investment allocations of these pension funds.
In 2023, the top 300 pension funds’ assets under management (AuM) recorded an increase of
Growth has remained faster among the biggest funds, as the top 20 largest pension funds in the world recorded an increase in assets of
The Government Pension Investment Fund of Japan remained the largest pension fund in the world, with AuM of
“While it is positive to note a return to growth among the world’s largest pension funds in 2023, the combination of a more uncertain macroeconomic environment and rising geopolitical instability means there is increasing complexity in the investment landscape,” said Jessica Gao, director, Thinking Ahead Institute.
Last year was characterized by the rising inflation and interest rate environment, both of which have since tapered off, but the outlook is by no means certain. Although the first half of 2024 has offered a degree of stability, uncertainty is still high, with volatility persisting in the global economy, heightened by geopolitical developments, including multiple significant elections.
Overall, defined benefit (DB) funds remain the largest share of assets, accounting for
On average, the top 20 largest pension funds invested approximately
“We previously warned of the need to address rising systemic risk,” said Gao, “where an entire system (like climate) malfunctions and puts emphasis on the need for a forward-thinking and re-positioning strategy.
“Since setting the first net-zero commitments in 2020, the asset management industry has faced this challenge under significant time pressure. Four years later, it has developed into a state that is emergent but unfortunately not yet fully formed,” concluded Gao.
Top 20 pension funds (US$ millions)
U.S. fund data are as of September 30, 2023. Non-U.S. fund data are as of December 31, 2023, except where shown.
| Rank | Fund | Market | Total assets |
| 1 | Government Pension Investment | Japan | 1,593,141 |
| 2 | Government Pension Fund | Norway | 1,584,524 |
| 3 | National Pension | South Korea | 801,864 |
| 4 | Federal Retirement Thrift | U.S. | 782,835 |
| 5 | ABP | Netherlands | 552,376 |
| 6 | Canada Pension | Canada | 477,676 (1) |
| 7 | California Public Employees | U.S. | 452,453 |
| 8 | Central Provident Fund | Singapore | 432,509 |
| 9 | National Social Security | China | 364,351 (2) |
| 10 | California State Teachers | U.S. | 309,931 |
| 11 | PFZW | Netherlands | 262,261 |
| 12 | New York City Retirement | U.S. | 247,999 |
| 13 | Employees Provident Fund | Malaysia | 247,268 |
| 14 | New York State Common | U.S. | 246,307 |
| 15 | Local Government Officials | Japan | 226,803 |
| 16 | AustralianSuper | Australia | 204,631 (3) |
| 17 | Florida State Board | U.S. | 194,659 |
| 18 | Ontario Teachers | Canada | 186,897 |
| 19 | Texas Teachers | U.S. | 181,656 |
| 20 | Labor Pension Fund | Taiwan | 176,267 |
- As of March 31, 2024
- Estimate
- As of June 30, 2023
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 engaged institutional asset owners and asset managers committed to mobilizing capital for a sustainable future. It has 52 members around the world and is an outgrowth of the WTW Investments’ Thinking Ahead Group, which was set up in 2002. Learn more at https://www.thinkingaheadinstitute.org/.
About WTW
At WTW (NASDAQ: WTW), we provide data-driven, insight-led solutions in the areas of people, risk and capital. Leveraging the global view and local expertise of our colleagues serving 140 countries and markets, we help organizations sharpen their strategy, enhance organizational resilience, motivate their workforce and maximize performance.
Working shoulder to shoulder with our clients, we uncover opportunities for sustainable success—and provide perspective that moves you.
Learn more at wtwco.com
Media contacts
Ed Emerman: +1 609 240 2766
eemerman@eaglepr.com
Ileana Feoli: +1 212 309 5504
ileana.feoli@wtwco.com
FAQ
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