• Atmospheric CO2 /Parts per Million /Annual Averages /Data Source: noaa.gov

  • 1980338.91ppm

  • 1981340.11ppm

  • 1982340.86ppm

  • 1983342.53ppm

  • 1984344.07ppm

  • 1985345.54ppm

  • 1986346.97ppm

  • 1987348.68ppm

  • 1988351.16ppm

  • 1989352.78ppm

  • 1990354.05ppm

  • 1991355.39ppm

  • 1992356.1ppm

  • 1993356.83ppm

  • 1994358.33ppm

  • 1995360.18ppm

  • 1996361.93ppm

  • 1997363.04ppm

  • 1998365.7ppm

  • 1999367.8ppm

  • 2000368.97ppm

  • 2001370.57ppm

  • 2002372.59ppm

  • 2003375.14ppm

  • 2004376.96ppm

  • 2005378.97ppm

  • 2006381.13ppm

  • 2007382.9ppm

  • 2008385.01ppm

  • 2009386.5ppm

  • 2010388.76ppm

  • 2011390.63ppm

  • 2012392.65ppm

  • 2013395.39ppm

  • 2014397.34ppm

  • 2015399.65ppm

  • 2016403.09ppm

  • 2017405.22ppm

  • 2018407.62ppm

  • 2019410.07ppm

  • 2020412.44ppm

  • 2021414.72ppm

  • 2022418.56ppm

  • 2023421.08ppm

News & Views

Are UK investors turning their backs on private markets?

During the PLSA conference in Edinburgh, pension funds were split about the benefits of investing in private markets, with lack of transparency on carbon footprints being one concern

Private assets are a critical vehicle to developing technologies and agendas that support the net zero transition. Compared to other big institutional investment markets such as Canada and Australia, UK institutional investors tend to be relatively underallocated to illiquid assets, a trend which the UK government is keen to reverse. 

While this sentiment was shared by some industry professionals at the Pensions and Lifetime Savings Association’s Investment Conference (PLSA) in Edinburgh, there was also an increased caution amongst delegates towards the asset class.

Sharing a positive outlook was Chris Moore, lead investment consultant at the Pensions Regulator (TPR), who told delegates that as more pension funds set net zero targets, climate solutions offered through private markets should be increasingly on their radar.

“Looking at Taskforce on Climate-related Financial Disclosure reports for example, we can see that many trustees have set net zero targets. But going forward to how they’re going to achieve that they need to be able to invest in things like green infrastructure and technologies.

“In order to do that, they need to be well emersed in the private markets area I would suggest,” Moore said.

Echoing Moore’s sentiment was Michael Robinson, investment proposition manager at £4bn Aegon Master Trust, who explained that the pension scheme started its journey to private markets prior to the Mansion House compact.

Aegon is one of the eleven defined contribution (DC) pension schemes signed up to the Mansion House Compact, which pledges for the fund to allocate 5% of assts in their default funds to unlisted equities by 2030.

Despite not being specific about the fund’s current allocation to private markets, Robinson told delegates to “watch the space” hinting at new investments in private markets.


There are a lot of agency issues in private markets, public markets are really easy to invest in, very transparent and value for money.

Dan Mikulskis, chief investment officer, People’s Partnership

‘Hurdles’ of private markets

However, investment into private markets does present challenges for investors, especially DC schemes, with fees, regulation and future consolidation being barriers to committing to illiquid assets.

Alongside this, climate data availability of unlisted assets also presents a challenge for both DC and DB investors, leaving asset owners at risk of not meeting their portfolio decarbonisation targets, as Dan Mikulskis, CIO at the People’s Partnership, which provides the £25bn People’s Pension warned. He warned that private markets “gets put on a pedal stool too much”.

Currently, the DC pension scheme does not invest in private markets, with Mikulskis stating that this is due to the “scale” of the fund, but also some of the challenges private markets investing presents.

“There are lots of good investments in private markets, but there are also a lot of bad investments.

“There are a lot of agency issues in private markets, public markets are really easy to invest in, very transparent and value for money. This sets quite a high hurdle for private markets,” Mikulskis explained.

A recent survey by Hymans Robertson found overall low progress in climate date reporting in private markets. It revealed that that the amount of climate data provided by private debt managers increased to 43% in 2023 from 21% in 2022, however the response rate on from infrastructure managers fell to 67% last year compared to 75% in 2022.

In addition, the rate of reply from property managers fell to 47% in 2023 from 60% in 2022. The lower response rate from managers reporting on property assets meant that there was less data provided on carbon emission, with only two thirds (62%) of property funds providing this data, according to Hymans Robertson’s study.

High cost for private markets

For Mikulskis, another issue with private markets is costs of investing into the asset class. He told delegates that there is “fundamental unfairness of the economics, shared between managers and clients”.

Mikulskis added that “splitting the economic” costs needs to be worked on and in order to do that “scale” is required.

Costs are also a concern for Leandros Kalisperas, chief investment officer at West Yorkshire Pension Fund (WYPF). He stated that “80-90% of our costs come from about 15% to 20% of our portfolio, so to Dan’s point, that’s meaningful asymmetry that does need to be understood”.

Currently, £19bn WYPF holds  60% in public equities, 20% in fixed income and credit as well as 20% in private markets.

However, Kalisperas highlighted that WYPF, alongside its partners in the Northern LGPS pool are part of GLIL, which is a “low-cost” direct core infrastructure investor within the UK.

“GLIL is a very good example in my mind of something that both deals with the cost issue [of investing in private markets] and deals with knowledge and greater confidence in terms of pension funds being able to do some things themselves. 

"We're able to do it because we're at scale but that doesn't mean it's perfect because nothing is perfect,” he added.

For £14.5bn Transport for London Pension Fund, Padmesh Shukla, CIO, stated that the scheme currently has 30% of its portfolio invested in private markets.

Shukla emphasised that when approaching private markets “you can do it well with the right governance and with an absolute focus on value for money. Otherwise, don’t do it because it's not the kind of quick fix that is going to give you the alpha over the long-term.”

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