NETHERLANDS - The €25bn industry-wide pension fund for the building industry BPF Bouw is to publish its equity investments to increase transparency.
Part of its policy will also be to "very selectively" invest in India, meeting its socially responsible investment policy against investment in companies involved in child labour, BPF Bouw said in its annual report.
Details of the report also reveal the scheme returned 7.7% on its investments in the previous year, exceeding its benchmark by 1.5%, while fixed income, equity and property yielded 0.5%, 12.8% and 12.7% respectively.
BPF Bouw, which outsources its asset management to Cordares, generated extra returns by being underweight in its fixed income portfolio and overweight in its European equity and emerging markets investments, the pension fund indicated.
BPF's strategic investment mix consists of 43% in fixed income, 29% in equity and 25% in real estate.
The scheme is now carrying out an asset-liability study into the introduction of new asset classes, in addition to its present holding in commodities, hedge funds and private equity alternatives, it added.
According to BPF Bouw, it will increase hedging of interest risks on liabilities through interest swaps as well as continuing its full hedging of main currencies, which generated returns of €138m.
BPF Bouw claimed to have the lowest cost per participant of its peer group under the CEM benchmark in 2005 at €61, compared to the group's average of €115.
However, the scheme's service had decreased to the lowest within its peer group, as a result of slow pension estimates and poor communication to its participants, it admitted.
The scheme's coverage ratio - still based in the fixed accounting rate of 4% - rose by 6% to 134%.
However, the scheme changed its pension arrangements from final to average salary last year and to optimise its asset management, the pension fund merged with the building industry's vut and prepension schemes for early retirement.
BPF Bouw now has 914,000 participants, of whom 209,000 are active members and 202,000 are pensioners. It serves 15,330 employers.