Asia, 14 November 2019 – The Asset Owner 100 (AO100) – the world’s 100 biggest asset owners – account for US$19 trillion, up 1.7% from last year, according to research from the Thinking Ahead Institute.
In its second study of the AO100, the Thinking Ahead Institute highlights the unique position that ‘Universal Owners’ have to direct capital in a sustainable way, making a significantly positive impact on issues including climate change.
Roger Urwin, global head of content at the Thinking Ahead Institute, said: “The major investment markets failed to make progress in 2018, but these funds in many cases were able to avoid losing ground against their longer term targets by sensible diversification, in particular into private markets.
“The 100 largest asset owners are responsible for over 35% of all global asset owner capital. Of these, there are a number of self-declared universal owners that are large-scale, long-term and leadership-minded funds that own a slice of the whole world economy. This makes them pursue an influential role in safeguarding the financial system and contributing positively to certain big societal issues such as climate change.
“During 2018 there were a number of sustainability initiatives by universal owner funds that involved ‘doing good while doing well’. This marks the start of a movement in which funds support societally beneficial initiatives that are consistent with financially sound fiduciary principles. GPIF, the Japanese fund that is the largest asset owner in the world, is at the centre of a number of these initiatives”.
Jayne Bok, Head of Investments, Asia at Willis Towers Watson, said: “Asset owners face lower expected returns in the future and the success with which they meet their targeted returns will be dependent on how well they adapt their investment model to integrate sustainability considerations such as ESG-related investment opportunities. Global best practice on sustainability for asset owners is on an upward trajectory, but it still has a long way to go. Here in Asia Pacific, the region continues to dominate the AUM of the world’s top 100 asset owners. The region’s importance will only increase as the development of a strong access route and far-sighted strategy to mainland China becomes critical to the future success of all asset owners. This will require them to build their understanding of the special factors governing China investment markets.”
“With this status, however, also comes the responsibility to take the lead in deploying capital to tackle some of the biggest challenges facing mankind today. We have already seen countries such as Japan leading the way in sustainable investing, but change is not happening fast enough to reverse the damage already being caused by issues such as climate change. To accelerate this, asset owners in Asia need to undergo a cultural, operational and business transformation that puts sustainability at the core of all investment models.”
The Thinking Ahead Institute’s analysis found that 59.1% of AO100 assets are held by pension funds, decreasing by 1.7% in 2018. 33.5% are held by sovereign wealth funds (SWF), increasing by 1.5% during the year and 7.4% by outsourced chief investment officers and master trusts, increasing by 0.2%. APAC remains the largest region in terms of AUM, accounting for 36.1% of assets in the ranking. EMEA and North American assets represent 32.3% and 31.6% respectively.
The top 20 funds total US$10.55 trillion and represent 55.5% of AO100 assets.
| Rank | Fund | Market | Total Assets | Category |
|---|---|---|---|---|
| 1 | Government Pension Investment Fund | Japan | $1,374,499 | Pension Fund |
| 2 | Government Pension Fund | Norway | $982,293 | Pension Fund |
| 3 | China Investment Corporation1 | China | $941,420 | SWF |
| 4 | Abu Dhabi Investment Authority1 | UAE |
$696,660 | SWF |
| 5 | Kuwait Investment Authority2 | Kuwait | $592,000 | SWF |
| 6 | Federal Retirement Thrift | U.S. | $578,755 | Pension Fund |
| 7 | National Pension | South Korea |
$573,259 | Pension Fund |
| 8 | Hong Kong Monetary Authority Investment Portfolio2 | Hong Kong | $509,353 | SWF |
| 9 | SAMA Foreign Holdings2 | Saudi Arabia | $505,755 | SWF |
| 10 | ABP | Netherlands | $461,682 | Pension Fund |
| 11 | SAFE Investment Company2 | China | $439,837 | SWF |
| 12 | GIC Private Limited2 | Singapore | $390,000 | SWF |
| 13 | California Public Employees | U.S. | $376,859 | Pension Fund |
| 14 | Temasek Holdings2 | Singapore | $374,896 | SWF |
| 15 | National Social Security | China | $325,002 | Pension Fund |
| 16 | Qatar Investment Authority2 | Qatar | $320,000 | SWF |
| 17 | Public Investment Fund/ Sanabil Investments2 | Saudi Arabia | $290,000 | SWF |
| 18 | Canada Pension2 | Canada | $287,410 | Pension Fund |
| 19 | Central Provident Fund | Singapore | $286,963 | Pension Fund |
| 20 | PFZW2 | Netherlands | $248,326 | Pension Fund |
1 As of May 31, 2019
2 As of December 1, 2018
3 As of 30 June 2018
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 institutional asset owners and service providers committed to changing and improving the investment industry for the benefit of the end saver. It has over 40 members around the world and is an outgrowth of Willis Towers Watson Investments' Thinking Ahead Group which was set up in 2002.
