Nine U.K. defined contribution plans have pledged to invest 5% of their default funds into private U.K. companies by 2030.
The investors on Monday signed the Mansion House Compact, which aims to give DC plan participants access to the returns of high-growth private companies as well as encouraging entrepreneurs to set up innovative high-growth companies.
Among signatories were the £30 billion ($38 billion) multiemployer DC plan National Employment Savings Trust, London.
"For many years now, illiquid assets have been integral to diversified DC pension schemes around the world," said Mark Fawcett, CEO of NEST Invest, a subsidiary of NEST, in an email. "It's been a key driver behind NEST setting up our own private market mandates to ensure our members aren't missing out. NEST will continue to increase our investment in unlisted equities, helping our 12 million members benefit from the strong returns these types of deals can typically offer."
Another signatory was Smart Pension, London, which has £3 billion in assets.
"Investing in certain unlisted equities, including innovative high-growth U.K. companies, creates potential for strong returns and should deliver better outcomes over the long term our members are saving for," said Nikesh Patel, trustee director of the Smart Pension Master Trust and chairman of the trustee investment subcommittee, in an email. "The Smart Pension Master Trust is committed to ensuring that its members gain access to a range of appropriate and relevant asset classes."
