JOHN MARNEWICK: Private markets able to offer investors more investment exposure than listed bourses

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Most ordinary investors are likely to be invested in private markets only through their retirement funds

, which are governed by the Pension Funds Act. Recent changes to Regulation 28 of the Pension Fund Act have clarified retirement funds’ ability to invest in alternative investments such as private equity, debt or hedge funds. Importantly, these changes mean pension funds can now invest in a broad spectrum of infrastructure assets.

In addition, the illiquidity of private market assets makes ESG mission-critical for asset managers for whom all positions are long-term. Private managers must therefore set high ESG standards for portfolio companies and then monitor performance consistently.Once an investment has been made, the manager must become a partner in the business, monitoring performance, adding value to the board, and contributing to management’s strategic thinking.

 

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