Dutch pension funds have transferred €372bn in assets from investment funds to mandates over the past three and a half years. Mandates make it easier for funds to implement their responsible investment policies.

Pension funds’ net investments in investment funds used to be fairly stable, but from the end of 2019 outflows gradually started to accelerate, according to figures from regulator DNB.

A DNB spokesman said that conversations with pension funds have indicated that these holdings have generally been converted to mandate investments.

He said: “However, the term mandate has been used more broadly here than what it is intended for. In general, investments that have been internalised are also being considered as mandates.”

According to the technical definition of a mandate, only investments outsourced to external asset managers are defined as such.

Over the past two years in particular, many investments in funds have been transferred to mandates. Since the third quarter of 2021, this amounts to as much as €318bn. At the beginning of 2021, pension funds were still investing some €763bn in mutual funds.

Since then, this amount has shrunk to less than €440bn, or 30% of total pension assets. By comparison, in 2017 this figure stood at 51%.


Dutch pension funds have been moving assets from investment funds to mandates to have more flexibility in implementing their ESG policies. An example of such a fund is Rabobank Pensioenfonds, which adopted a bespoke ESG index excluding Chinese tech firm Alibaba, among others

ESG policy

A popular reason for pension funds to convert investments in funds to mandates is a tightening of their responsible investment policies whereby, for example, certain companies are excluded based on ESG criteria.

ABP is an example of such a fund, as it decided in 2020 that it no longer wanted to invest in pooled funds with other pension funds. The civil service scheme required more flexibility to achieve its ambitions in the field of sustainable investment. At the end of 2019, ABP was still investing around €300bn in such funds.

ABP has now largely exchanged those investments for mandates, but has not yet completed the operation.

More pension funds are resorting to mandates for similar reasons. Examples of funds that exchanged fund investments for mandates in response to a new responsible investment policy are Pensioenfonds Rabobank and Pensioenfonds PostNL.

But smaller funds are also joining the trend. Just this month, €2.1bn Pensioenfonds Gasunie exchanged a fund investment with BlackRock for a mandate with State Street Global Advisors.

Foreign fund investments up

Meanwhile, pension funds do continue to channel money io foreign investment funds. In the past two years, nearly €25bn net was invested.

According to DNB, this is mainly due to changes in the strategic investment policy of pension funds. Pension funds have been investing more in private equity and real estate, mostly through foreign investment funds.

The increase in investments in foreign funds does not go at the expense of investments in the Netherlands, according to DNB. Investments in the Netherlands as a percentage of total assets have risen from 15.7% in 2020 to 18.3% at the end of the first quarter of 2023.

This article was first published on Pensioen Pro, IPE’s Dutch sister publication.