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2022 GLOBAL INSTITUTIONAL INVESTOR STUDY

Think EQuilibrium

View interactive PDF
Overview

Climate of change

Finding balance amid momentous shifts in markets, the environment and society
The climate is changing—and this shift is about much more than just the weather. Our survey of 800 institutions globally found that asset owners and consultants are reexamining traditional approaches to investing as they grapple with highly volatile markets, rising inflation, tightening monetary policy, ongoing disruptions from a global pandemic and increased awareness of social inequality.
View interactive survey results (download and view PDF in Adobe Acrobat for full data results)
Explore section previews

01

Markets

Majority turning to alternative credit in reach for yield

 

02

Climate

86% see opportunity in transition to low carbon economy

 

03

Social

Half considering/ currently investing in social investments

About the survey
Nuveen and CoreData surveyed 800 global institutions (700 asset owners, 100 consultants) spanning North America (NORAM); Europe, Middle East and Africa (EMEA); and Asia Pacific (APAC) in October and November 2021. Respondents were decision-makers at corporate pensions, public/ governmental pensions, insurance companies, endowments and foundations, superannuation funds, sovereign wealth funds, central banks as well as consultants. Asset owner survey respondents represented organizations with assets of more than $10B (55%) and less than $10B (45%), with a minimum asset level of $500 million. The survey has a margin of error of ± 3.5% at a 95% confidence level.
Markets

Investors brace for new market paradigms

The market environment appears to be entering a different season, one defined by new patterns and regimes. In addition to the near-term challenges related to the COVID-19 pandemic and heightened geopolitical risks, investors are bracing for increased volatility, higher inflation and upward pressure on interest rates. These conditions reflect a fundamental change from what investors have experienced over the past several decades.

 

Q: In the next 12 months, which of the following portfolio changes is your organization likely to take/are most likely for your institutional clients?

As plan sponsors and asset allocators, we’re tasked with achieving these lofty return expectations, north of 7%, all within the parameters of prudent risk management. Those two things are becoming incongruent. … It’s challenging conventional wisdom, for sure.

— U.S., public pension, investment officer



 

Climate

Widespread recognition of climate impact is changing how institutions build portfolios

This year’s survey results confirm what has been a palpable sense across the asset management industry: momentum has never been stronger for addressing climate change and confronting the risks and opportunities related to the transition to a low carbon economy. While there is widespread recognition of climate risk as an investment risk, there are significant differences in how institutional investors are addressing climate change in their portfolios.

 

Q: Is your organization currently addressing climate risk in your portfolio(s)?

The three Ds: digitalization, decentralization and decarbonisation. Those are the big, secular trends. … Decarbonisation is clearly the one big elephant in the room.

— Germany, corporate pension, head of investments



 

Social

Investors are progressing social impact on many fronts

More than half (52%) of survey respondents agree that investors can impact social inequality through investment choices. And investors today are addressing inequality in multiple ways. For some institutions, this involves adding impact investments that address specific social causes to their portfolios. For others, it means incorporating DE&I practices into how they build their internal teams or select outside managers. In addition, investors increasingly are focused on the interaction of environmental and social investment decisions.

 

Q: Does your organization currently invest or plan to invest in social investments in the next two years/currently advise clients about social investments?

When you talk about diversity, you have to be very careful that you get true diversity, not just what percentage of women are in the fund manager’s workforce. … Diversity of thought leads to better decision-making.

— Australia, public pension, CIO



 

Learn

Explore how the climate of change is shaping the future of investing

At Nuveen we are committed to rethinking the future and developing investment solutions that can flex to the increasingly complex needs and objectives of investors. Whether it be addressing climate goals or re-evaluating income objectives, our investment teams are working with clients every day to help them work toward their near-term obligations in an uncertain market while also positioning for the systemic, longer-term changes that are to come. 

Portfolio construction strategies: Two-thirds of investors plan a rethink - what's next?

WEBINAR ON DEMAND
Nuveen experts share where institutions are turning for yield and how they’re changing their portfolio constructions strategies.
The views and opinions expressed are for informational and educational purposes only, as of the date of production/writing and may change without notice at any time based on numerous factors, such as market or other conditions, legal and regulatory developments, additional risks and uncertainties and may not come to pass. This material may contain “forward-looking” information that is not purely historical in nature. Such information may include, among other things, projections, forecasts, estimates of market returns, and proposed or expected portfolio composition. Any changes to assumptions that may have been made in preparing this material could have a material impact on the information presented herein by way of example.

Past performance is no guarantee of future results. Investing involves risk; loss of principle is possible.

All information has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. There is no representation or warranty as to the current accuracy, reliability or completeness of, nor liability for, decisions based on such information and it should not be relied on as such.

Risks and other important considerations

This material is presented for informational purposes only and may change in response to changing economic and market conditions. This material is not intended to be a recommendation or investment advice, does not constitute a solicitation to buy or sell securities, and is not provided in a fiduciary capacity. The information provided does not take into account the specific objectives or circumstances of any particular investor, or suggest any specific course of action. Financial professionals should independently evaluate the risks associated with products or services and exercise independent judgment with respect to their clients. Certain products and services may not be available to all entities or persons. Past performance is not indicative
of future results.

Economic and market forecasts are subject to uncertainty and may change based on varying market conditions, political and economic developments. As an asset class, real assets are less developed, more illiquid, and less transparent compared to traditional asset classes. Investments will be subject to risks generally associated with the ownership of real estate-related assets and foreign investing, including changes in economic conditions, currency values, environmental risks, the cost of and ability to obtain insurance, and risks related to leasing of properties.

This information does not constitute investment research, as defined under MiFID.

Responsible investing incorporates Environmental Social Governance (ESG) factors that may affect exposure to issuers, sectors, industries, limiting the type and number of investment opportunities available, which could result in excluding investments that perform well.
 
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