The world’s 100 largest asset owners are now responsible for $25.7trn, according to new research by the Thinking Ahead Institute.

The Asset Owner 100 – 2022 report, in its fifth year, revealed that total assets among the largest organisations have grown by 9% as of end-2021, down from 16% growth over the previous year.

Roger Urwin, co-founder of the Thinking Ahead Institute, said: “These big asset owners control the world’s most influential capital and hold great responsibility and growing influence in relation to their beneficiaries, and to a widening group of stakeholders.”

Pension funds remain the single biggest group of asset owners in the global study, controlling 56% of total assets although this has fallen from 58% the previous year. By contrast, sovereign wealth funds have seen their share rise comfortably above one-third, to 37%, up from 35% the previous year.

The Government Pension Investment Fund of Japan remains the largest asset owner in the world ($1.7trn) followed by the two largest sovereign wealth funds: Norway’s Government Pension Fund Global (GPFG), which is managed by Norges Bank Investment Management ($1.4trn) and China Investment Corporation ($1.2trn).

IPE reported last month that GPFG has seen its total assets increase by half a trillion kroner in the latest quarter because of a weaker domestic currency and inflows from oil revenue.

The top 20 asset owners are responsible for $14.1trn, or the majority (55%) of the top 100. This level of concentration has persisted since its inception, although individual asset owners have moved within the ranking, the Institute disclosed.

“The research highlights that many of these asset owners act as universal owners – long-term, leadership minded holders of portfolios that are exposed to the entire market and economy – and have a distinctive opportunity to contribute to real-world systemic change by contributing to a Paris-aligned future, consistent with net zero emissions by 2050,” Urwin said.

Long-term investing

The report also zooms in on long-horizon investing. Uncertainty has been one of the dominant themes in the investment industry in 2022 from heightened geopolitical risk and increased volatility, requiring investors to work within a more disciplined framework. With the macro being complex and uncertain, long-horizon investing principles provide a crucial set of guardrails, the report said.

There has been a continued focus on sustainability. Large asset owners have become more prominent in integrating ESG in pursuit of improved long-term sustainable returns, with some asset owners stepping up and moving beyond the impact of ESG risks on the portfolio to consider the impact of the portfolio and the assets on the world, it added.

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