The UK pension performance challenge
The Mansion House Compact was an attempt to address a pressing issue and has encouraged a more proactive stance to private markets – but there are challenges.
Expert analysis by Andy Thomson
In the UK, pension performance has come under considerable scrutiny, falling behind comparable markets such as Australia and Canada. What the latter two countries’ pensions have in common is a longstanding commitment to investing in private markets. In the UK, that commitment has been lacking historically.
In July 2023, the Mansion House Compact was an attempt to address this imbalance. It saw 11 initial UK defined contribution pension fund signatories come together to pledge allocations of at least 5 percent of total assets to unlisted equities by 2030. While unlisted equites were specifically cited, some pensions have used the Compact as a launchpad for an all-encompassing push into private markets...