Principles and Policies for In-House Asset Management

Clark, Gordon L.; Monk, Ashby H. B.

doi:10.2139/ssrn.2189650

Cited by 14 publications

(5 citation statements)

References 11 publications

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“…In particular, the results call for a more nuanced treatment of economies of scale in public pension management. Although authors have not yet ventured to determine a clear size threshold, the consensus has so far been that larger assets equate larger ICRs (Clark & Monk, 2013b;Collins, 2003;Dixon & Monk, 2014). While the findings presented here confirm the general character of this assertion, a handful of counter-examples show that smaller (and distant) plans can in fact find ways to insource.…”

Section: Discussionsupporting

confidence: 50%

Rescaling of American public pension finance: are state and local plans running away from Wall Street?

Urban

2019

Territory, Politics, Governance

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Thwarted by the failures of investment managers and consultants, institutional investors are increasingly interested in bypassing private contractors to invest their assets. State and local pension plans, which face unfunded liabilities worth US$1.2 trillion, could save billions of taxpayers' money annually by insourcing longterm direct investments in private markets and by outsourcing their public markets investment to low-cost passive fund providers. Hitherto, there is little comprehensive evidence on their actual practices in both respects. This paper addresses this gap empirically. It assesses the investment strategies of a sample of 31 state and local pension plans in conjunction with the evolution of 12 leading national asset management centres (AMCs) between 2006 and 2012. The results show that public pension funds manage close to one-third of their assets in-house. Preliminary econometric analysis shows the significance yet limited influence of economies of scale and suggests that geographical distance from AMCs is associated with higher levels of insourcing. Overall, state and local plans display a high degree of institutional and geographical heterogeneity. In light of these findings, it is argued that public pension management is to a large extent driven by bottomup local political processes that undermine the implementation of sound investment management arrangements.

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Section: Discussionsupporting

confidence: 50%

Rescaling of American public pension finance: are state and local plans running away from Wall Street?

Urban

2019

Territory, Politics, Governance

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“…Some principles of long-term investing are close to state capitalism, notably in their preference for real assets that contribute to the sustainable development of countries (Gelb et al, 2014). Long-term investment is also often associated with direct investments by institutional investors, alone or through co-investments, but without traditional financial intermediaries whose rewards have traditionally been linked to short-term results (Clark and Monk, 2012b).…”

Section: Swfs' Professionalization Around the Values Of Long-term Investingmentioning

confidence: 99%

Who do sovereign wealth funds say they are? Using structural topic modeling to delineate variegated capitalism in their official reports

2020

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Sovereign Wealth Funds (SWFs) are an emerging community of investment organizations, subject to the conflicting demands of international and domestic institutions. From the lens of variegated capitalism, one can explain their diversity and apparent contradictions by underlining how they embody negotiations between global and local institutional pressures. Many SWFs now publish official reports, which represents a unique opportunity to analyze how they portray these institutional influences. We use an unsupervised machine learning method, structural topic modeling, to analyze the 2015 official reports of 40 SWFs and 17 public pension funds globally. With this novel method, we propose the first international, community-wide study that shows how capitalism is adapted across regions, political systems, and even organizational frontiers through SWFs. We show that region and political systems are factors supporting a polarization of missions between neoliberal and state capitalist view. However, this is nuanced by international clubs that support new investment strategies, and some high-profile SWFs that mix the neoliberal and state capitalist views.

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“…In addition, improvement of fund value management does not necessarily translate into higher returns. Clark and Monk (2012) analyzed case studies of the largest institutional investors among pension funds and sovereign wealth funds from around the world in order to develop principles and policies for investment management and generally found conflicting results bot revealing significant and nonsignificant influence of investment management on investment performance.…”

Section: Independent Variablesmentioning

confidence: 99%

Influence of Pension Fund Management Practices on Investment Performance of Individual Pension Schemes in Kenya

ODIRA,

MIROGA (Ph.D),

OTINGA (Ph.D)

2020

strategicjournals.com

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This study intended to investigate the influence of pension fund management practices on investment performance of individual pension schemes in Kenya. The study employed explanatory survey research design and targeted 108 respondents which comprised of fund managers/fund administrators, actuaries/ fund scheme advisors and auditors from 36 individual pension schemes in Kenya; from where a census method was used to select all the 108 respondents. Primary data was collected by means of self-administered structured questionnaires. Data collected from the field was coded, cleaned, tabulated and analyzed using both descriptive and inferential statistics with the aid of specialized Statistical Package for Social Sciences (SPSS) version 24 software. Both descriptive and inferential statistics showed that all the study's independent variables (financing management practice, investment management practice, financial control practice, asset base management practice) significantly influence investment performance of individual pension schemes in Kenya. The study concluded that one; well implemented financing management practices such as prudent financing approaches, cost management tactics, capital administration significantly influence investment performance of individual pension schemes; two, asset base management practices significantly influence investment performance of individual pension schemes in Kenya; only if mean asset base and its investment yield are well intertwined. The study recommended that one, fund and administrative managers of individual pension schemes should have prudent financial control practices while factoring in administrative costs in pension schemes so as to guarantee their significant influence on investment performance; two, fund and administrative managers of individual pension schemes should ensure effective utilization of mean asset base and investment yields so as to realize their significant contribution to investment performance.

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Principles and Policies for In-House Asset Management

Cited by 14 publications

References 11 publications

Rescaling of American public pension finance: are state and local plans running away from Wall Street?

Rescaling of American public pension finance: are state and local plans running away from Wall Street?

Who do sovereign wealth funds say they are? Using structural topic modeling to delineate variegated capitalism in their official reports

Influence of Pension Fund Management Practices on Investment Performance of Individual Pension Schemes in Kenya

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