Stockholm (NordSIP) – The Norwegian Government Pension Fund Global has been ranked as the most transparent fund in the world. The sovereign wealth fund, which is managed by Norges Bank Investment Management (NBIM), achieved a perfect score of 100 in the latest Global Pension Transparency Benchmark (GPTB).
The annual GPTB is in its fourth iteration and results from a collaboration between Toronto, Canada based CEM Benchmarking and Top1000funds.com. The underlying analysis focuses on the levels of cost, governance, performance, and responsible investment-related disclosure of the five largest funds in each of 15 countries. These include defined benefit, defined contribution pension schemes as well as sovereign pension reserve and buffer funds. The GPTB researchers evaluated freely available information from official websites, annual reports, and other documents published by the funds under analysis.
The outcomes of the 2024 GPTB reveal a generally positive trend, with the average fund scoring 63 out of 100, which is a significant increase from the average score of 55 in 2022. However, this improvement in average score masks the growing gap between leaders and laggards. Most of the overall progress is being made at the top end of the table, with the lowest-ranked fund only achieving an overall score of 14.
Leaders leaving laggards in their wake
Commenting on the latest release Edsart Heuberger, CEM Benchmarking’s product lead for transparency benchmarking said: “For leading funds, the GPTB methodology has become a roadmap for improving transparency. These funds have addressed the gaps in their score.” Heuberger is concerned by the lack of progress in the lower ranks, adding: “Surprisingly, we continue to see few improvements from funds that were laggards in the first edition of this benchmark. The laggards then are still the laggards now. The gap between the best and the laggard funds is increasing, which is unusual for most benchmarks.”
The GPTB also provides a country ranking, topped this year by Canada based on average overall score, followed by Australia and the Netherlands. Canada also comes out first when it comes to responsible investment reporting, followed by the Netherlands and Sweden. The Norwegian Pension Fund Global is joined at the top of the individual fund ranking by Canada Pension Plan (CPP) investments and the California Public Employees’ Retirement System (CalPERS). Sweden’s AP4 is ranked 12th out of 75, Denmark’s ATP is 14th, and Sweden’s AP7 and AP3 are joint 18th. The highest ranked Finnish fund is Varma at 31st, with fellow mutual pension insurers Elo and Ilmarinen coming close behind in 32nd and 34th places respectively. The lowest ranked Nordic providers are Oslo Pension fund in 62nd position and the Equinor scheme at 66th. Many of the laggards are Central or South American funds. There also appears to be room for improvement in several Japanese and South African funds.
When focusing on responsible investment related transparency, Norway’s Pension Fund Global also tops the rankings, with AP4 and AP7 coming in at 4th and 7th respectively. Commenting on the results at the University of Oxford’s Fiduciary Investors Symposium on 5 December 2024 Frederick Willumsen, NBIM’s Global Head of Strategy and Research explained his organisation’s approach to transparency: ““In one sense we have one client, the Ministry of Finance; but in another sense, we have five and a half million clients, the people of Norway. Norges Bank conducts a reputation survey every second year which shows a clear link between what people know about the fund and whether they trust the management of the fund. So for us it’s really important that people know what we are doing, they know the organisation, the investment strategy and so on, because we really think that is a way of building trust in what we are doing.”
