"Pension asset growth has continued to closely match global public market equity and bond returns," Ms. Hall said. "Boards continue to manage against the headwinds that have arisen from a new normal of lower-for-longer interest rates and heightened market uncertainty, diversifying more to be able to mitigate some of the shocks through a move to private markets."
From 2015 through 2020, the survey showed a strong correlation between plan size and asset growth, with the 20 largest funds delivering annualized asset gains of 8.9%, ahead of the next 30 largest funds (7.8%) and the smallest of the 300 (6.5%).
Despite the economic upheaval caused by the pandemic, the survey's 20 largest funds saw their combined assets climb 14.6% to $9.09 trillion in 2020 — which represented a 41.8% share of top 300 assets compared with 40.7% a year earlier.
The top 300's assets, in turn, amounted to 41.3% of the $52.52 trillion in global pension assets estimated by the Thinking Ahead Institute's annual global pension asset study.
North American funds overall held the largest share of assets, at 41.7%, among regions, although that slid from 43.8% in the prior survey. Meanwhile, European funds increased to 27.5% from 25.8% the year before and Asia-Pacific funds grew to 27.5% from 26.6%.
However, the U.S. is still the largest market in the world, and it has 62% of the global pension market, followed by Japan, Ms. Hall said.
Because some funds are maturing and are paying out more in promised benefits, it was expected that some funds' assets would drop, she said.
Both U.S. and Japan have populations that are aging, compared with some emerging markets.
Ms. Hall reiterated that the largest funds grew their assets at a faster pace compared with other funds due to more evolved governance structures that allowed them to harvest better market returns. Funds with a total portfolio governance approach have done quite well, she said.
"There is a material link between performance and strong governance models. As funds try to meet more complex sustainability goals such as net-zero and achieving real-world impact, they need to reassess their capabilities and resources. We are starting to see funds move toward a total portfolio governance approach as a means of meeting these objectives," she said.
Over the past five years, Asia-Pacific funds in the top 300 posted annualized growth of 9.9%, exceeding North American funds' 7% growth and European funds' 7.8% growth. Latin America and African funds combined grew by an annualized 5.7% over the five years.