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1、1Global Survey Report 2023Gauging risk,building resilienceFindings from the 2023 Global Endowment and Foundation Investment Survey 2Gauging risk,building resilienceContents3 Foreword4 Introduction:A global response,from a diverse range of E&F investors7Keyfindingssummary9 Keyfindings1:Portfoliorisks

2、andoperational resilience 16 Keyfindings2:Driving long-term performance through short-term challengesassetallocationtrends24 Keyfindings3:The experience in privatemarkets29 Keyfindings4:Aligning corporate citizenship with impact,values and climate 37 Conclusion38 Contact usContentsIntroductionKey fi

3、ndings 4Contact usKey findings summaryForewordKey findings 1 Key findings 2 Key findings 3Conclusion3Gauging risk,building resilienceForewordUnderstanding organizations concerns,recent investment allocations and plans for the future is the principal aim of this study.In 2022,endowment and foundation

4、(E&F)investors concerns about low expected future returns and inflation framed the broader shift into private markets that played out across last years survey findings.A year on,investors across this very diverse universe of organizations each with unique social,health,educational,faith and communit

5、y-driven missions are still facing a complex investment environment.For some,2023 may have felt like getting up and running after completing a marathon,having just navigated portfolios through a global pandemic,war in Europe and the onset of higher inflation.Concerns around inflation,fears of recess

6、ion,ongoing market volatility and evolving geopolitical risks have only increased among investors contributing to this years research.In the short term,inflation and market volatility can present distinct challenges,particularly when funding operational needs and meeting spending targets are reliant

7、 on portfolio returns.Understanding organizations concerns,recent investment allocations and plans for the future is the principal aim of this study.This year,we have aggregated data and investor views across 24 global markets to build a snapshot of investors responses on these three themes.Since th

8、e 1980s,the pathway into private markets has been driven forward,at least in part,by E&F investors at the leading edge of investment innovation.This year,E&F investors continue to advance into these strategies and have pushed through near-term uncertainty to increase private market allocations.As th

9、e opportunity set for value creation and long-term growth has expanded along the risk curve and across private market segments,E&F investors in varying contexts are increasing exposure to private equity.They are also increasing allocations into infrastructure,providing opportunities for inflation pr

10、otection alongside long-term returns.We explore why size should not be the determining factor in allocating to private markets,and examine the experience of investors with existing private markets programs.Diversification is a(if not the)core component of investing to support the multi-decade,multi-

11、generational objectives of this group of investors,and it is interesting to consider the opportunities that still lie ahead for E&F investors as a cohort.One example of these opportunities is emerging market equities,which have been identified by respondents because of their long-term growth potenti

12、al and role in diversifying equity allocations.Approaches to sustainable investment and the net-zero transition continue to vary by market and by portfolio size.We assess the prevalence of impact strategies across E&F portfolios.We hope that investors across the E&F community find this research usef

13、ul as they navigate the complexity of the current environment.Texas Hemmaplardh,US Not-for-Profit Investments Leader ForewordContentsIntroductionContact usKey findings 1 Key findings 2 Key findings 3ConclusionKey findings summaryKey findings 44Gauging risk,building resilienceA global response,from a

14、 diverse range of E&F investorsA snapshot of investment practices,plans and challengesMercer Investments 2023 Endowment&Foundation investment survey analyzes the investment approaches,plans and ambitions of E&F investors and their organizations globally.Assembling the views of 115 E&F investors from

15、 24 countries across seven regions,this research seeks to establish a cross-sectional global view of E&F organizations current positioning and share insights,experience and ambitions around:The outlook for portfolio risk and resilience in relation to shifts in spending targets Evolving trends in ass

16、et allocation The experience of E&F investors in private markets Impact investment,ESG integration and net-zero transition across portfolios,in the context of organizations broader mission or purposeIntroductionForewordContentsKey findings 1 Key findings 2 Key findings 3ConclusionContact usKey findi

17、ngs summaryKey findings 45Gauging risk,building resilienceBreakdown of the 115 organizations that responded to our survey Number of organizationsPercentage of organizationsUS$100muptoUS$250m17%20LessthanUS$50m33%38US$50muptoUS$100m17%19US$250muptoUS$1bn16%18US$1bnormore17%20Geographic distributionUS

18、 21%Canada 18%UK 18%APAC 18%Europe 14%IMETA 7%LATAM 3%IntroductionForewordContentsKey findings 1 Key findings 2 Key findings 3ConclusionContact usKey findings summaryKey findings 46Gauging risk,building resilienceWhich sector does your organization operate within?40%Private foundation or charity18%C

19、ommunity or public foundation15%Educational organization12%Healthcare organization8%Faith-based organization6%Association/Member organization2%Aged care2%Indigenous corporation6%Other3%Banking foundationGovernance arrangementsThe majority of respondents to this years survey have the key building blo

20、cks of strong governance in place:Three-quarters(76%)of organizations have developed a set of investment beliefs or an investment policy.Among organizations that have established beliefs/principles:90%of their investment beliefs/SIPs(investment policies)cover the purpose of the investment portfolio

21、85%of their SIPs govern strategic asset allocation 77%of their SIPs document their investment beliefs More than two-thirds(69%)have an investment committee distinct from their board or executive management team(in the remaining 31%investment decisions are taken by the board or the executive team)Sca

22、le of operations Internal investment teams across organizations are generally small and the number of employees dedicated to managing investments is low,even among organizations with the very largest portfolios.70%of E&F organizations have 14 employees dedicated to managing investments within the or

23、ganization The number of employees dedicated to investment does not differ dramatically by size,bar the very largest portfolios of US$1bn or more,35%of which employ 510 people 13%have 510 employees,while 3%have 1120 or more than 20 eachIntroductionForewordContentsKey findings 1 Key findings 2 Key fi

24、ndings 3ConclusionContact usKey findings summaryKey findings 47Gauging risk,building resilienceKey findings summary1.2.Portfolio risk and operational resilience Near-term risks of inflation,recession and market volatility are front of mind for E&F investors,as more than half(52%)anticipate a rise in

25、 their organizations spending targets over the next three years.Against an inflationary backdrop,more than half(54%)of organizations regard delivering a level of investment return sufficient to meet spending needs as a significant risk.Following a series of extreme weather events and natural disaste

26、rs across regions in 2023,more than half(54%)of organizations deem climate change to be a significant risk to portfolios.Driving long-term performance through short-term challenges asset allocation trends Allocations beyond traditional developed market equities and bonds from private markets and alt

27、ernatives to emerging markets are strongly correlated with the size of portfolios,reinforcing the access challenge for smaller organizations to invest in some of these strategies.Private market allocations are evolving and infrastructure is gaining more attention.Having already added to infrastructu

28、re allocations over the past three years,plans to further increase exposure may reflect organizations belief that inflation will remain high.More organizations(68%)have increased allocations to private equity than any other asset class over the past three years.E&F investors are increasing allocatio

29、ns to sustainable investment strategies;41%of organizations plan to increase allocations to ESG and sustainable strategies,and 60%of organizations with existing allocations plan to increase allocations.Key findings summaryContentsIntroductionForewordKey findings 1 Key findings 2 Key findings 3Conclu

30、sionContact usKey findings 48Gauging risk,building resilience3.4.The experience in private markets More than half(58%)of E&F organizations are currently invested in private market assets or are considering investing over the next 12 months.This rises to 90%for the largest portfolios(over US$1bn).The

31、 experience of investing in private markets is overwhelmingly positive for organizations already doing so,with nearly four-fifths(79%)saying that they have been adequately compensated for illiquidity risk.Organizations are very comfortable with extended lock-up periods in private markets and nearly

32、three-quarters(73%)agree that performance has compensated for high fees.Aligning corporate citizenship with impact,ESG and climate One-quarter(26%)of respondents use impact investment to align portfolios with their organizations broader mission or purpose.However,impact investing is not widespread a

33、cross E&F portfolios,and nearly two-thirds(62%)of organizations do not have an allocation to impact strategies or projects.Concerns around return implications,a lack of robust data,and the risk profile of investible assets.When incorporating ESG considerations into investment decisions,nearly one-th

34、ird of investors(31%)opt to exclude sectors or companies,compared to 19%who undertake company engagement and active ownership;the former proportion has fallen significantly from 60%of organizations in our 2022 research.Just 15%of organizations have set a science-based net-zero target across their po

35、rtfolio.One-fifth of respondents have implemented a DEI(diversity,equity,inclusion)framework across their investment program.Climate transition is the most-cited societal issue that organizations believe could be supported through portfolio allocation;this issue is most important for organizations i

36、n the United Kingdom,Australia&New Zealand,and across the IMETA region.Key findings summaryContentsIntroductionForewordKey findings 1 Key findings 2 Key findings 3ConclusionContact usKey findings 49Gauging risk,building resilience1 Portfolio risks and operational resilience Keyfindings Risks of infl

37、ation,recession and market volatility are front of mind for organizations,as more than half(52%)anticipate a rise in spending targets over the next three years.Against an inflationary backdrop,more than half(54%)of organizations see significant risk around delivering a level of investment return suf

38、ficient to meet spending needs.Following a series of extreme weather events and natural disasters across regions in 2023,more than half(54%)of organizations deem climate change to be a significant risk to portfolios over the next 12 months.Action points Consider adopting a scenario-driven approach t

39、o assessing portfolio risks across a range of time horizons,and the way in which the risks of inflation,rising rates and climate change impact asset values.Review governance arrangements through a dual lens,to assess potential short-term pressures in relation to long-term opportunities for outperfor

40、mance.IntroductionKey findings 4Key findings 1 Key findings 2 Key findings 3ConclusionForewordContentsKey findings summaryContact us10Gauging risk,building resilienceIn a year in which global markets continued to adjust to a structurally higher inflation regime and interest rates continued to rise,i

41、t is perhaps unsurprising that E&F investment decision-makers deem inflation to be the most significant risk to portfolios over the year ahead.While this group of investors is diverse by organization type,size,geography and scale,all face the triple threat of inflation to some degree:the erosion of

42、real investment returns;loss of spending power in support of their mission;and,beyond these direct impacts,far-reaching consequences for portfolio construction increasing complexity for those seeking to diversify portfolios.Despite market volatility being a key risk for nearly three-quarters of orga

43、nizations,inadequate diversification which we would view as a key driver of portfolio vulnerability to risks of inflation,a recessionary backdrop and market volatility is deemed significant by just 12%of organizations.We regard diversification as the primary mechanism through which investors can ens

44、ure their portfolio is robust for future market events and regimes(whether it be higher inflation,managing energy transition or periods of persistently higher volatility).For long-term E&F investors,risk is less about short-term volatility and more about the risk of not having enough real growth ove

45、r time.Diversification targeting rewarded risk over the long term is a core tenet of this approach.While short-term volatility and impacts on performance may not be something all investors are comfortable with,there are advantages to thinking more laterally for the long term,supported by the right g

46、overnance framework.While climate is clearly a prominent concern for many non-US investors already,we expect this to become an even more material consideration over the coming years,as regulation,geopolitics and asset values continue to evolve through an era of climate change.Olaolu Aganga US Chief

47、Investment Officer Key findings 1 ContentsIntroductionForewordKey findings 2 Key findings 3ConclusionContact usKey findings summaryKey findings 411Gauging risk,building resilienceShort-term risks of inflation,recession and market volatility are front of mind for organizations.How significant do you

48、believe the following risks are to your organizations portfolio over the next 12 months?Significant Not that significantNot a considerationInflation82%11%7%Potential for economic recession78%15%8%Market volatility73%17%10%Geopolitical tensions65%21%15%US/China relations59%24%17%Climate change54%29%1

49、8%Inability to generate sufficient investment returns to meet spending needs54%35%11%National elections/changes in government administration43%41%17%ESG reputational risk34%39%27%Talent management31%43%25%Operational risk28%54%18%Cost constraints of running the portfolio26%52%22%Liquidity constraint

50、s24%57%18%Governance constraints19%55%26%Regulatory risk17%57%26%Inability to access private assets14%49%37%Inadequate diversification12%61%27%LowHighNote:More than one answer could be selected,therefore the total may exceed 100%.Key findings 1 ContentsIntroductionForewordKey findings 2 Key findings

51、 3ConclusionContact usKey findings summaryKey findings 412Gauging risk,building resilience1.1 Extended inflation impact aligned with recession concerns Investor concerns over inflation(significant for 82%of organizations)and the potential for economic recession(significant for 78%)are closely aligne

52、d;the potential portfolio impacts of persistent inflation are compounded by a low growth or recessionary environment and the spectre of stagflation,which can prove challenging for even the most resilient portfolios.Inflation protection was the most cited“hindsight capability”that is,the capability t

53、hat the greatest proportion of organizations would have added to their portfolios if given the opportunity to repeat the prior year in the market.If you could repeat last year(2022)in the market,what one capability would you add to your portfolio management?Percentage of organizationsLess than US$50

54、m US$50m up to US$100m US$100m up to US$250m US$250m up to US$1bn US$1bn or more Inflation protection43%37%53%50%33%50%Dynamic or tactical allocation16%16%21%10%22%10%Private markets allocation10%5%5%20%17%10%Manager research capabilities9%24%0%5%0%0%Thematic allocation6%5%5%10%6%5%Inflation protect

55、ion was the most cited“hindsight capability.”Second-orderinflationimpactsMeeting spending targets Beyond the impact of inflation on portfolio returns,the second-order impacts of inflation on E&F operations seem front of mind for organizations:(51%)expect their projected spending targets to increase

56、over the next three years.Just 8%of organizations are very confident that investment returns across their portfolio will meet their target rate of spending plus inflation over the next 10 years.While 61%are quite confident,nearly one-third(31%)are not confident that returns will support future incre

57、ases in the spending needs of their organization.while keeping up with performance targets Inflationary pressures are a key consideration for the 35%of E&F investors who assess investment performance relative to an inflation target which is as high as CPI+5%for some organizations.and funding operati

58、ons:Nearly two-thirds of respondents(63%)manage endowment portfolios,40%of whom report that endowment distributions fund over 50%of their annual operating budget.Key findings 1 ContentsIntroductionForewordKey findings 2 Key findings 3ConclusionContact usKey findings summaryKey findings 413Gauging ri

59、sk,building resilienceInflation squeeze on endowment operations In scenarios where there is a higher level of reliance on portfolio results,spending can swing high and low depending on how the markets perform.If organizations are funding material operational expenditure from the endowment whether th

60、ats paying staff or making grants the volatility of the portfolio inevitably becomes a greater concern;it impacts not only the portfolio,but also operations at large.Michael Lauer Senior Investment Consultant1.2 Short-term risks affecting long-term focusRisks presented by market volatility over the

61、short term are front of mind for 73%of organizations,emphasizing the interrelated nature of risk across both portfolios and wider operations for E&F investors,and the knock-on challenges to maintaining a truly long-term focus.However,the level of concern over a 12-month timeframe among investors all

62、ocating towards long,even multi-generational,investment horizons,may speak of the extent to which organizations are already feeling the effects of volatility on their operations.While 61%of organizations believed their portfolio had been fairly resilient to the market upheavals of 2022,just 17%deeme

63、d their portfolio to have been very resilient;more than one-fifth(22%)of organizations felt that their portfolio lacked resilience during the prior year.If faced with unexpected liquidity requirements,two-thirds(66%)of organizations are confident in their ability to make cash flows available with mi

64、nimal disruption to the overarching strategy.However,17%said that such a scenario would necessitate immediate liquidation of assets and 8%would have had to adopt emergency measures.Key findings 1 ContentsIntroductionForewordKey findings 2 Key findings 3ConclusionContact usKey findings summaryKey fin

65、dings 414Gauging risk,building resilience1.3 Evolving geopolitics:US/China dynamics As the war in Ukraine nears a two-year milestone,it is clear that the impacts of evolving geopolitical dynamics on politics,economics and populations remain front of mind for organizations:two-thirds(65%)regard geopo

66、litical tensions as a significant risk to portfolios over the coming year.The US/China relationship is deemed a significant risk by 59%of organizations.It was a prominent investment consideration during the year,with rising protectionism and economic rivalry continuing to drive new trade alignments

67、and supply chains.Had we undertaken this survey following US President Joe Bidens recent executive order,which will limit or ban US investment in a range of technology sectors in countries of concern,this risk may have featured even more prominently.Looking through risk to opportunity in non-aligned

68、 emerging marketsNon-aligned markets across the emerging and frontier complex are benefiting from evolving US/China dynamics,primarily through western companies reshoring of supply chains.We expect markets that are able to continue attracting trade and investment from both the US and China to appeal

69、 to investors,given that many of these economies are tied to the US dollar.Adeline Tan Wealth Business Leader,Hong KongKey findings 1 ContentsIntroductionForewordKey findings 2 Key findings 3ConclusionContact usKey findings summaryKey findings 415Gauging risk,building resilience1.4 Climate considera

70、tionsWhile climate change risk falls outside of the top five most-cited near-term concerns for E&F organizations,more than half(54%)view it as significant.Climate change concerns are most elevated among organizations based in the IMETA region(where 50%of organizations view climate change risk as hig

71、hly significant,and a further 25%deeming it significant),followed by the United Kingdom,Australia and New Zealand.At the global level,climate change risk is deemed most significant by public and community foundations(70%)and association&member organizations(80%).Climate transition is at the forefron

72、t of organizations intentions for portfolios,and it is the most-cited(37%)societal issue that organizations believe could be supported through portfolio allocation.Key findings 1 ContentsIntroductionForewordKey findings 2 Key findings 3ConclusionContact usKey findings summaryKey findings 416Gauging

73、risk,building resilience2Driving long-term performance through short-term challenges asset allocation trends Keyfindings Allocations beyond traditional developed market equities and bonds from private markets and alternatives to emerging markets are strongly correlated with the size of portfolios,re

74、inforcing the access challenge for smaller organizations.More organizations(68%)have increased allocations to private markets than any other asset class over the last three years.Over the next three years,41%of organizations plan to introduce or increase allocations to ESG and sustainability strateg

75、ies;60%of organizations with existing allocations plan to increase allocations.Action points Review strategic asset allocations with an eye on how small adjustments or adding new asset classes at modest weights could reduce risk or provide protection against specific risks.Consider how allocations t

76、o real assets across infrastructure and real estate could support your organizations sustainability strategy and objectives.Consider how an allocation to private debt can both generate an income to support spending needs as well as contribute to real growth over the longer term.Key findings 1 Key fi

77、ndings 2 IntroductionKey findings 2 Key findings 3ConclusionForewordContentsContact usKey findings 4Key findings summary17Gauging risk,building resilienceWith nearly one-third(31%)of E&F organizations lacking confidence that returns will support future increases in spending anticipated by 51%over th

78、e next three years it is clear that asset allocation will be critical to meeting spending needs,avoiding shortfalls or liquidity constraints,and ultimately,driving growth across portfolios over the long term.Our data indicates significant scope for continued diversification across portfolios,which w

79、ill not only help to build resilience against some of the short-term risks highlighted by organizations,but also support long-term performance.The inflationary backdrop has driven changes in correlations between fixed income and equities,prompting investors to look beyond traditional asset classes f

80、or portfolio protection.It is encouraging to see a significant proportion of organizations already investing across the private markets and alternatives universe,and,despite recent turbulence in valuations,plans to develop these programs further.E&F organizations have made a notable push into infras

81、tructure over the past three years.We believe this reflects an effort to bolster resilience to inflationary pressures by gaining exposure to the pricing power,inelastic demand profile and growth opportunities afforded by infrastructure assets particularly in areas at the forefront of digital innovat

82、ion and energy transition.In addition,with fixed income having been re-priced across the board,we think private debt is an asset class that looks increasingly appealing today for E&Fs.It is somewhat uniquely placed to deliver both income to meet spending needs today as well as contribute to real gro

83、wth over the longer term.Andrew McDougall Global Head of Multi-Asset Key findings 2 Key findings 1 ContentsIntroductionForewordKey findings 3ConclusionContact usKey findings summaryKey findings 418Gauging risk,building resilience2.1 How E&F investors are allocated todayInsight into organizations cur

84、rent allocations indicates the scope of private market and alternatives allocations across E&F portfolios,notably in real estate,infrastructure,private equity and private debt,though exposure to these areas is most common across larger portfolios.A similar size-related correlation is present in emer

85、ging market equities,with exposure more prevalent in larger portfolios.Percentage of organizationsLess than US$50m US$50m up to US$100m US$100m up to US$250m US$250m up to US$1bn US$1bn or more Developed market equities 81%56%87%100%89%95%Emerging market equities 51%21%53%67%61%79%Cash/money market

86、48%38%53%56%61%42%Developed market government debt 45%24%60%56%44%63%Real estate(fund)44%18%60%56%39%74%Infrastructure(fund)41%26%53%44%44%53%Private equity(funds)35%12%33%33%50%63%Hedge funds/absolute return 35%12%33%56%44%47%Developed market IG credit 34%15%33%50%39%47%Private debt 34%18%33%39%50%

87、42%Multi-asset credit 28%21%27%33%22%42%Other 21%6%27%28%28%32%Emerging market government debt 16%9%13%11%22%32%Emerging market IG credit 16%9%27%11%28%16%Commodities 16%9%20%6%28%26%Real estate(direct investment)14%9%20%17%17%16%Private equity(investments)13%6%7%28%6%21%Infrastructure(direct invest

88、ment)10%3%13%28%6%5%Frontier market equities9%6%13%0%11%16%LowHighNote:More than one answer could be selected,therefore the total may exceed 100%.Key findings 2 Key findings 1 ContentsIntroductionForewordKey findings 3ConclusionContact usKey findings summaryKey findings 419Gauging risk,building resi

89、lienceRegional snapshot:Investment in private equity is most common across the portfolios of E&F organizations based in the United States and United Kingdom.Exposure to infrastructure is most prevalent among E&F portfolios in Australia&New Zealand,the United Kingdom and Canada.Allocations to emergin

90、g market equities are most prevalent among organizations based in the United States.Asset classMean allocation to asset class Developed market equities 42.10%Developed market government debt 16.68%Developed market IG credit 16.64%Private equity(investments)16.59%Multi asset credit 12.91%Hedge funds/

91、absolute return 11.91%Real estate(direct investment)11.48%Private equity(funds)11.25%Cash/money market 11.13%Frontier market equities 8.90%Private debt 8.51%Other 8.27%Emerging market IG credit 8.00%Infrastructure(direct investment)7.63%Real estate(fund)7.15%Infrastructure(fund)6.88%Emerging market

92、government debt 6.60%Emerging market equities 6.44%Commodities 5.54%Key findings 2 Key findings 1 ContentsIntroductionForewordKey findings 3ConclusionContact usKey findings summaryKey findings 420Gauging risk,building resilienceAllocations beyond traditional developed market equities and bonds from

93、private markets and alternatives to emerging markets are strongly correlated with the size ofportfolios.Our data indicates that allocations beyond traditional developed market equities and bonds from private markets and alternatives to emerging markets are strongly correlated with the size of portfo

94、lios,reinforcing the access challenge for smaller organizations.In the private equity(PE)space,63%of portfolios over US$1bn have an allocation to PE funds(21%invest directly)relative to 33%of portfolios under US$100m,and just 12%of those under US$50m.While the trend by size is most striking in PE,it

95、 is evident more broadly across private markets and alternative asset classes.In the public equities arena,53%of portfolios under US$100m have exposure to emerging markets,compared to 79%of the largest funds in excess of US$1bn,suggesting a potential diversification opportunity across public equity

96、allocations.Does size matter to diversification?One of the most striking trends in our data is the degree to which size of portfolio correlates with allocations to areas beyond developed market equity and fixed income.Size evidently does matter in accessing more complex and resource-intensive altern

97、ative asset classes.In our view,however,this should not deter organizations of all sizes from accessing opportunities across the private markets universe.It is prudent for smaller organizations to consider all potential routes to access the long-term opportunities offered by private markets beyond d

98、irect investments.For example,innovative structures such as semi-liquid funds and open-ended structures are being built with the flexibility and liquidity needs of investors in mind.Another asset class where the level of allocation is closely correlated with portfolio size is emerging market equitie

99、s.Only one-fifth(21%)of the smallest portfolios have exposure,compared to four-fifths(79%)of the largest portfolios,in excess of US$1bn.Across all organizations,the mean allocation to emerging market equities(5%)is dwarfed by equivalent exposure to developed market equities(42%).We remain convinced

100、of the opportunity for EM outperformance relative to developed markets going forwards.While concerns around US/China dynamics may deter EM allocations,we think it is important for investors to consider developments for Developed Market,Emerging Market ex-China and China separately,given the varied o

101、utlooks across economies.That said,the impact on portfolios of EM allocations on climate transition,specifically carbon emissions,has been in focus for a number of our E&F clients.Paul Fleming UK Head of Endowment and Foundations Key findings 2 Key findings 1 ContentsIntroductionForewordKey findings

102、 3ConclusionContact usKey findings summaryKey findings 421Gauging risk,building resilience2.2 Maintaining stability and embracing alternative allocations through market uncertainty In 15 out of 19 asset classes considered,a greater proportion of E&F organizations have maintained existing allocations

103、 at their current levels over the past three years,rather than increasing or decreasing exposure.Yet despite the challenges of the market environment over the past three years from the Covid selloff to the major interest rate regime change continued demand for private markets is clear.Over the past

104、three years,E&F investors have added to their allocations in alternatives,increasing their portfolio weighting in private equity and infrastructure,while also increasing exposure to ESG/sustainable strategies.The strongest shift in allocations over the past three years has been into private equity,w

105、here 68%of those with existing allocations have increased exposures,relative to 24%of organizations that have maintained the same positioning.Allocations to infrastructure have increased over the past three years;52%of organizations with existing exposure to infrastructure funds have increased alloc

106、ations(relative to 39%that maintained existing levels of allocation over the period).While 34%of organizations have maintained their ESG/sustainability exposure,58%have increased their exposure to these strategies over the past three years.Nearly one-third(31%)of organizations integrate ESG consider

107、ations through allocations to ESG investments such as low-carbon strategies in global equities.2.3 Over the next three years,ESG should remain a priority,and organizations are seeking to build resilience in portfoliosE&F organizations plans for the next three years signal a continued push into ESG a

108、nd sustainability strategies:41%plan to increase allocations to ESG/sustainability funds,rising to 60%among those with existing allocations.The strongest shift in allocations over the past three years has been into private equity,where 68%of those with existing allocations have increased exposures.K

109、ey findings 2 Key findings 1 ContentsIntroductionForewordKey findings 3ConclusionContact usKey findings summaryKey findings 422Gauging risk,building resilienceBuilding sustainability exposure Although there are divergent approaches to incorporating environmental,social and governance considerations

110、into portfolios in some cases,drawn along political lines it is notable that a substantial proportion of E&F investors intend to increase allocations to ESG/sustainable strategies.We interpret two potential drivers here:first,that this group of ultra long-term,even multi-generational investors more

111、than one-third of which are keen to align portfolio allocation with mitigating the impacts of climate change see the opportunity in participating in multi-decade climate transitions,from climate change to natural capital.Second,that E&F investors continuing to build exposure to sustainable strategie

112、s believe that ESG risk factors are financially material.Gilles Lavoie Partner,Investment Consulting,Canada E&F investors also indicate an intention to build greater stability and enhance inflation protection through increased exposure to developed market credit and infrastructure funds.One-fifth(20

113、%)of organizations plan to introduce or increase allocations to developed market credit,evidence of their intention to diversify fixed income allocations.Key findings 2 Key findings 1 ContentsIntroductionForewordKey findings 3ConclusionContact usKey findings summaryKey findings 423Gauging risk,build

114、ing resilienceDiversifying fixed income With the repricing of fixed income in 2022 and 2023,both duration and growth fixed income are now much better positioned to deliver solid investment qualities to E&F portfolios.Specifically,all-in yields provide healthy cushions against future increases in int

115、erest rates,with income levels moving up and helping fund spending needs.Whilst credit spreads are around median levels,forward-looking returns from growth fixed income such as multi-asset credit and emerging market debt look attractive.Andrew McDougall Global Head of Multi-AssetDialing down exposur

116、e The top-five asset classes in which E&F investors are more likely to decrease than increase their exposure over the next three years are as follows(though it is important to note that the majority of respondents are not planning to change their exposure in these asset classes):Domestic equities17%

117、16%Cash/money market funds10%Overseas equities10%Developed market government debt9%Hedge funds/absolute returnConfidenceincurrentasset allocation Over 80%of the respondents do not expect to be changing their exposures to these major asset classes.This indicates confidence in the overall strategic as

118、set allocation of portfolios.Setting the right strategy for each organization and maintaining the discipline to keep those strategies in place through market cycles can be highly valuable when managing long-term portfolios through short-term volatility.Key findings 2 Key findings 1 ContentsIntroduct

119、ionForewordKey findings 3ConclusionContact usKey findings summaryKey findings 424Gauging risk,building resilience3 The experience in private markets Keyfindings More than half(58%)of E&F organizations are currently invested in private market assets or are considering investing over the next 12 month

120、s.This rises to 90%of E&F portfolios in excess of US$1bn,and 75%of portfolios of US$100250m.The experience of investing in private markets is overwhelmingly positive for organizations already doing so:nearly three-quarters(73%)agree that performance has compensated for high fees,a view that remains

121、broadly consistent across organizations by size.Organizations are very comfortable with extended lock-up periods in private markets,with nearly four-fifths(79%)saying that they have been adequately compensated for illiquidity risk.Action points Assess whether there is an opportunity to increase or d

122、iversify existing private market allocations to include new private market asset classes,such as private debt and infrastructure.Review your existing governance framework and commitment plans to ensure that it is designed and prepared to support the existing or a new/expanded private markets allocat

123、ion over time.Consider the pros and cons of private impact investments to support your organizations mission.Key findings 3Key findings 2 Key findings 1 IntroductionConclusionForewordContentsContact usKey findings 4Key findings summary25Gauging risk,building resilienceFor E&F investors already alloc

124、ated to private markets,those allocations are,broadly,delivering the expected outcomes in portfolios.When partnering with organizations to build private market exposure,we encourage investors to challenge themselves on one core issue:are they prepared to stay the course through periods of market str

125、ess and in the context of their existing governance arrangements?Where time horizons,liquidity considerations and long-term objectives allow,private market allocations can provide compelling opportunities,particularly through challenging periods.Some of the stand-out vintages of private market funds

126、 have been delivered through periods of heightened market volatility,enabling investors to benefit on both the way in by virtue of distressed valuations and attractive entry points and the way out,through improved market conditions offering potential above-average pricing.Our survey demonstrates rob

127、ust demand for not only private equity and real estate,where many organizations might begin building their alternative allocations,but increasingly,in infrastructure.The current environment offers a favorable backdrop to E&F investors seeking to increase private market allocations,driven in part by

128、shifts in the strategic asset allocation of other significant investors.Many pension funds,for example,have been liquidating or reducing allocations to private markets to manage liquidity notably in the secondary markets in order to pay pensions.This was particularly notable among UK-based pension f

129、unds in late 2022,to pay collateral for liability-driven investment(LDI)arrangements.Secondary investments present E&F investors with the scope to access more mature private markets opportunities,and the ability to build exposure more quickly relative to a purely primary fund allocation.From our wor

130、k with E&F organizations in the United States,we observe a slight disconnect emerging between high levels of interest in private credit strategies and actual allocations to the asset class.Over the very long term,many are still opting to access the return premium from private equity over credit.On a

131、 multi-decade view,we see private markets as an avenue through which investors can participate in the megatrends transforming economies whether through driving the clean energy transition,the evolution of AI,or the future of healthcare.In private markets,we believe that E&F investors have an opportu

132、nity to bring their mission to life,by backing areas most closely aligned to their purpose.Raelan Lambert Global Alternatives LeaderKey findings 3ContentsIntroductionForewordKey findings 1 Key findings 2 ConclusionContact usKey findings summaryKey findings 426Gauging risk,building resilience3.1 Acce

133、ssing private markets The big migration to private markets was a prominent theme in our 2022 survey,and we were keen to explore the experience of those organizations investing across these asset classes.More than half(58%)of E&F organizations are currently invested in private market assets or are co

134、nsidering investing over the next 12 months.While the prominent correlations between portfolio size and allocations to private market asset classes are well documented in Key findings 2,it is interesting to consider how this trend plays out as all alternative investments become more accessible.Does

135、your organization invest in private markets?(For example,private equity,venture capital,private debt,private real estate)Yes,or considering in the next 12 monthsNoUS$100muptoUS$250mLessthanUS$50m21%79%Percentageoforganizations58%42%US$50muptoUS$100m63%37%US$250muptoUS$1bnUS$1bnormore75%25%78%22%90%1

136、0%Our Investment Committee have decided to allocate to the private market sector within our endowment.We believe that these investments can improve the risk/return profile of our portfolio,as well as help achieve our challenging Environmental,Social and Governance objectives.Bill Lane Investment Com

137、mittee Chair,Diocese of RochesterKey findings 3ContentsIntroductionForewordKey findings 1 Key findings 2 ConclusionContact usKey findings summaryKey findings 427Gauging risk,building resilienceRoutes to accessing private markets also vary by size of portfolio.How do you invest in private markets?Les

138、s than US$50m US$50m up to US$100m US$100m up to US$250m US$250m up to US$1bn US$1bn or more We invest in private markets funds29%44%71%64%82%We invest in private markets via funds-of-funds29%44%57%73%41%We invest directly in specific deals/companies(not through a fund)29%11%29%0%18%We co-invest alo

139、ngside(a)general partner(s)14%22%7%9%24%We establish joint ventures with operating partners to invest in specific deals29%0%0%0%6%Other0%0%0%0%6%3.2 Private market allocations are delivering for E&F investorsOverwhelmingly,organizations already investing in private markets report a positive experien

140、ce across a range of risk and return considerations.Four-fifths(79%)of E&F organizations agree that they have been adequately compensated for the illiquidity risk assumed through their private market allocations.Organizations are very comfortable with extended lock-up periods for their capital in pr

141、ivate markets;86%are comfortable with illiquidity over 10 or more years.Nearly three-quarters(73%)agree that they have been compensated for high fees,a level of endorsement that remains broadly consistent across the size spectrum.Three-quarters(76%)of organisations agree that private markets have de

142、livered expected levels of diversification.Despite the challenges,61%of organizations are confident in current valuations.E&F organizations,with their long-term investing mindset,are uniquely placed to benefit from recent uncertainty around valuations Macro uncertainty,driven by rising interest rate

143、s and volatility in public markets,has created challenges around exits from private investments,whether through delays in public listings or buyer uncertainty in the valuations underpinning private assets.That said,we see general partners responding by extending time horizons or by exploring other l

144、iquidity options such as launching continuation funds.Given organizations high level of comfort with extended lock-up periods,we expect interesting opportunities to arise for those investing for the long term.Deborah Wardle UK Alternative Investments LeaderNote:More than one answer could be selected

145、,so the total may exceed 100%.Key findings 3ContentsIntroductionForewordKey findings 1 Key findings 2 ConclusionContact usKey findings summaryKey findings 428Gauging risk,building resilienceAllocation snapshot:Alternatives What is your current asset allocation to the following:Percentage of organiza

146、tionsDont knowLess than US$50m US$50m up to US$100m US$100m up to US$250m US$250m up to US$1bn US$1bn or more Real estate(fund)(%)44%2%18%60%56%39%74%Infrastructure(fund)(%)41%3%26%53%44%44%53%Private equity(funds)(%)35%2%12%33%33%50%63%Hedge funds/Absolute return(%)35%3%12%33%56%44%47%Private debt(

147、%)34%3%18%33%39%50%42%Real estate(direct investment)(%)14%3%9%20%17%17%16%Private equity (investments)(%)13%2%6%7%28%6%21%Infrastructure(direct investment)(%)10%2%3%13%28%6%5%Note:More than one answer could be selected,therefore the total may exceed 100%.LowHighAlternative asset classMean allocation

148、 to asset class Private equity(investments)16.6%Hedge funds/absolute return 11.9%Real estate(direct investment)11.5%Private equity(funds)11.3%Private debt8.5%Infrastructure(direct investment)7.6%Real estate(fund)7.2%Infrastructure(fund)6.9%Key findings 3ContentsIntroductionForewordKey findings 1 Key

149、 findings 2 ConclusionContact usKey findings summaryKey findings 429Gauging risk,building resilience4 Aligning corporate citizenship with values,climate transition and impact Action points Define your impact objective(s)aligned with the investment strategy,and the mission of your organization on a l

150、ocal,national and international level Assess how your organizations desired level of values alignment and target setting for climate transition can inform the development or revision of a responsible investment policy.Explore the steps required to formalize and implement a DEI policy across your org

151、anization,especially to facilitate diversity of thought in the portfolio management process.Climate transition plans can provide a forward-looking assessment of climate risk,capacity and opportunity within an investment portfolio.Tools like Mercers Analytics for Climate Transition(ACT)enable investo

152、rs to assess possibilities for portfolio changes and establish pathways to a low-carbon portfolio.Keyfindings One-quarter(26%)of respondents cite impact investment as the mechanism through which they align their portfolio with their organizations mission.At a global level,however,impact investing is

153、 not widespread across E&F portfolios;nearly two-thirds(62%of organizations)do not have an allocation to impact strategies or projects.Concerns around return implications,a lack of robust data,and the risk profile of investible assets are the barriers most cited by investors in impact-specific strat

154、egies,or those intending to invest in them.Just 15%of organizations have set a science-based net-zero target across their portfolio;one-fifth(21%)have implemented a DEI framework across their investment program.Climate transition is the most-cited social issue that organizations believe could be bet

155、ter supported through portfolio allocation;this issue is most important for organizations in the United Kingdom,Australia&New Zealand,and across the IMETA region.Key findings 3Key findings 2 Key findings 1 IntroductionKey findings 4ConclusionForewordContentsContact usKey findings summary30Gauging ri

156、sk,building resilienceSustainable,climate and impact-focused investing represents a rapidly evolving universe of approaches to factoring environmental,social and governance considerations into allocations.Impact investing targeting specific societal or environmental outcomes alongside financial retu

157、rns has developed as more investors seek to drive real-world outcomes in society and the environment through their capital allocations.There is a reputational component to impact investing,tied to the role of institutional investors as corporate citizens,which may be particularly prominent for missi

158、on-aligned organizations.Stakeholders of endowments,public and healthcare foundations or charities may expect capital to be put to work in pursuit of clear social or environmental objectives.Rebekah Dunn Head of Endowments and Foundations,Pacific 4.1 Impact investing:allocations and barriersWhile on

159、e-quarter of organizations(26%)use impact investment as a mechanism to align their portfolio allocation with the wider mission of their organization,impact approaches are not yet widespread across portfolios in aggregate.62%of organizations do not have any allocation to impact strategies;18%have all

160、ocations of 110%of their total portfolio,while 8%have allocations of under 1%.Impact strategies are most prevalent in portfolios across the IMETA region,where 38%of E&F investors have a 110%allocation,and the United States,where 26%of portfolios have over 16%of their portfolio allocated to impact st

161、rategies.Portfolios of UK-based E&F investors are least likely to include allocations to impact strategies.Among those investing,or intending to invest,in impact strategies or projects,concerns over the potential impact on returns(65%)is the most-cited barrier to increasing allocations,followed by a

162、 lack of robust data(63%)and the risk profile of investable assets(57%).How much of a barrier are these factors to increasing allocations to impact investments?Barrier No barrierDont knowConcerns over potential impact on returns65%22%13%Lack of robust data63%21%16%Risk profile of investible assets57

163、%24%18%Lack of investment opportunities driving impact outcomes in the local community55%22%23%Lack of investible projects52%30%18%Lack of investment opportunities driving impact outcomes aligned with my organizations goals/targets47%31%21%Note:More than one answer could be selected,therefore the to

164、tal may exceed 100%.LowHighKey findings 4IntroductionForewordContentsKey findings 1 Key findings 2 Key findings 3ConclusionContact usKey findings summary31Gauging risk,building resilienceConcerns around the robustness of data are often cited in relation to establishing sustainable investment framewo

165、rks whether around impact or net-zero target setting.In the impact space,there have been notable advances in standards and measurement tools,yet there are still relatively few mandatory reporting requirements,meaning that investors may encounter a range of disparate methodologies.We encourage invest

166、ment managers to report at an underlying company or asset level consistent with the Impact Management Projects Five Dimensions of Impact,1 a framework which should give organizations confidence in the managers impact objectives.Private markets provide a range of impact opportunities,whether through

167、venture or growth-stage investments,where investors can gain exposure to innovative technology and business models,sustainable real estate or renewable infrastructure.Some organizations have already advanced their impact approach:one organization has taken the decision to allocate 10%of its portfoli

168、o to mission-based investments,in addition to an impact allocation,while another is building an impact program outside of its endowment portfolio.Angelika Delen,Global Head of Impact Investing4.2 Current ESG integration and assessment methodologiesIntegration of ESG considerations into due diligence

169、 of external managers and ongoing monitoring64%31%Allocation to ESG investments(such as global equity low carbon)31%Exclude sectors or companies on the basis of ESG considerations20%Impact investing19%Undertaking company engagement and active ownershipNearly one-third of investors(31%)opt to exclude

170、 sectors or companies,compared to 19%who undertake company engagement and active ownership,though the former proportion has fallen significantly from 60%of organizations in our 2022 research.Key findings 4IntroductionForewordContentsKey findings 1 Key findings 2 Key findings 3ConclusionContact usKey

171、 findings summary32Gauging risk,building resilienceAs momentum continues to build behind sustainable investment allocations across E&F portfolios,the majority of organizations now integrate environmental,governance and social considerations across their manager selection and ongoing monitoring.Howev

172、er,exclusionary approaches remain more widespread than active engagement.We see an opportunity for stewardship and company engagement to become a more prominent part of E&F organizations sustainable investment approaches.Cori Trautvetter US Endowment&Foundation Practice Leader4.3 ESG integration app

173、roaches vary by organization size and geography Incorporation of ESG considerations into investment decisions broadly correlates with size of portfolio.At the country level,organizations based in the United Kingdom,Australia and New Zealand are most likely to integrate ESG considerations,including a

174、cross due diligence and monitoring of external managers(also more prevalent among Canadian organizations),allocations to ESG investments,and exclusion of sectors on the basis of ESG considerations.The majority of organizations(57%)do not believe they need to make compromises in order to meet their E

175、SG investment objectives(a marginal reduction from 61%in our 2022 research),but:11%believe they will have to compromise their portfolios diversification 10%believe they will have to compromise their portfolios absolute return 9%believe they will have to compromise on tracking errors across their por

176、tfolio,rising to one-fifth(20%)of the largest portfolios(in excess of US$1bn AUM)Large E&F investors are more likely to consider impact investment and active ownership.How does your organization incorporate ESG considerations into investment decisions?Less than US$50m US$50m up to US$100m US$100m up

177、 to US$250m US$250m up to US$1bn US$1bn or more We integrate ESG considerations into due diligence of our external managers and ongoing monitoring42%74%90%67%70%Allocate to ESG investments(such as global equity low carbon)13%32%45%50%35%Exclusion of sectors or companies on the basis of ESG considera

178、tions21%42%40%28%35%Impact investing11%11%25%22%40%Company engagement and active ownership11%21%20%22%30%Proxy voting8%16%25%22%25%Integrated into security selection(internally managed investments)8%5%25%17%0%Other37%5%5%22%25%Note:More than one answer could be selected,so the total may exceed 100%.

179、Key findings 4IntroductionForewordContentsKey findings 1 Key findings 2 Key findings 3ConclusionContact usKey findings summary33Gauging risk,building resilienceHow does your organization incorporate ESG considerations into investment decisions?Percentage of organizationsUnited StatesUnited KingdomEu

180、ropeCanadaAustralia/New ZealandIMETALATAMWe integrate ESG considerations into due diligence of our external managers and ongoing monitoring64%54%95%44%76%71%25%25%Allocate to ESG investments(such as global equity low carbon)31%25%67%25%10%38%13%25%Exclusion of sectors or companies on the basis of ES

181、G considerations31%33%43%13%24%52%0%25%Impact investing20%29%19%13%19%19%13%25%Company engagement and active ownership19%17%19%6%14%33%25%25%Proxy voting17%17%14%13%24%24%0%25%Integrated into security selection(internally managed investments)10%8%0%19%5%19%13%25%Other22%25%10%44%14%19%13%50%N1152421

182、16212184Note:More than one answer could be selected,so the total may exceed 100%.Through our grant-making,advocacy and influence on systems we aim to support South Australians to be free from poverty.This extends to our investment portfolio with our mission and values guiding where and how we deploy

183、 our capital.Stacey Thomas CEO,Wyatt TrustKey findings 4IntroductionForewordContentsKey findings 1 Key findings 2 Key findings 3ConclusionContact usKey findings summary34Gauging risk,building resilience4.4 Climate transition,science-based net-zero targets and implementation The data also provides a

184、clear snapshot of the limited scope of climate transition across portfolios.These programs have been undertaken by only a minority of organizations.Less than one-fifth(18%)of organizations have set climate transition targets;just 14%have implemented them.While 17%plan to set targets within the next

185、two years,nearly two-thirds(64%)have not set targets and do not plan to do so.The proportion of organizations not planning to set climate transition targets is broadly consistent across the size spectrum and by organization type.The data provides a clear snapshot of the limited scope of climate tran

186、sition acrossportfolios.4.5 Net zero A similar picture emerges in relation to net zero target-setting:15%of organizations have set a science-based net-zero target across their portfolio,rising to 20%for portfolios in excess of US$1bn.Net-zero target-setting is more common among organizations in the

187、United Kingdom and Australia/New Zealand,where 24%have set net-zero targets.Among those that have set a net-zero target,a marginally higher proportion have set a longer-term target:35%are aiming for 2030,while 41%are aiming for 2050.The data suggests a potential disconnect between intent and action

188、when it comes to investing towards climate and net-zero transition.More than one-third(37%)of organizations cite climate transition as the issue that they believe could be better supported through portfolio allocation,yet just 15%have set a net-zero target.The pathway towards net zero across portfol

189、ios is not straightforward but can be supported by tools including scenario analysis and risk modelling as part of a broader transition framework.E&F investors not planning to set a net-zero target may feel that they lack the resources to establish a framework and pathway,but investment approaches t

190、o the net-zero transition are evolving,and support is out there for organizations wishing to formalize their approach.Michel Meert Senior Investment Consultant,EuropeKey findings 4IntroductionForewordContentsKey findings 1 Key findings 2 Key findings 3ConclusionContact usKey findings summary35Gaugin

191、g risk,building resilience4.6 DEI integrationThe majority of organizations are still developing or have yet to develop their approach to integrating diversity,equity and inclusion(DEI)across the investment process.Diversity means different things to different investors,but incorporating a DEI lens i

192、nto the decision-making process can align portfolios with organizational mission and values.One-quarter(24%)of firms are still in the process of integrating DEI considerations into the investment process.One-fifth(21%)of organizations already require managers to provide diversity statistics and poli

193、cies and encourage diverse investment management across their entire investment program.On a regional basis,organizations based in the United States,United Kingdom and IMETA are most likely to be developing,or are already implementing,a DEI framework across their portfolio.How does your organization

194、 incorporate gender and racial diversity,equity,and inclusion(DEI)considerations into its investment decisions?We are in the process of developing DE&I considerations for our investment program25%21%We encourage diverse investment management throughout the entirety of our investment program and requ

195、ire all search candidates to provide their diversity statistics and policies6%We seed diverse managers5%We encourage our managers to have a reconciliation action plan2%We have a requirement that at least one diverse investment manager be included in every manager search0%We allocate a set percentage

196、 of our portfolio to diverse managers51%OtherNote:More than one answer could be selected,so the total may exceed 100%.4.7 Aligning mission and portfolio ESG alignment across portfolios and impact investing are the primary mechanisms through which organizations seek to reflect their mission or purpos

197、e across their portfolio allocations.43%of organizations align their investment allocation with their mission/purpose through ESG alignment,while 26%do so through impact investment;24%support mission-alignment through program-related investments.Climate transition is the most-cited social issue that

198、 organizations believe could be supported through portfolio allocation.Key findings 4IntroductionForewordContentsKey findings 1 Key findings 2 Key findings 3ConclusionContact usKey findings summary36Gauging risk,building resilienceWhat are the social issues and/or outcomes that you believe that your

199、 organization could better support through its portfolio allocation?Percentage of organizationsUnited StatesUnited KingdomEuropeCanadaAustralia/New ZealandIMETALATAMClimate transition37%33%48%19%29%48%75%0%UN SDGs(Sustainable Development Goals)29%13%43%44%14%24%38%75%Local housing and welfare develo

200、pment24%29%24%13%24%33%13%25%Local community/outreach projects20%17%24%6%14%14%50%75%Diversity initiatives18%25%10%0%24%19%38%25%Decarbonization17%13%19%19%19%24%0%25%Food scarcity16%17%0%25%24%10%38%0%Youth outreach programs16%13%5%13%10%24%25%75%Elderly community15%8%14%0%19%24%25%25%Social mobili

201、ty14%21%0%13%10%14%25%50%Te Ao Maori-led strategy4%0%5%0%0%19%0%0%Maori representation on boards4%0%5%0%0%19%0%0%None of the above30%50%24%31%38%14%13%0%Other10%4%10%0%14%19%13%0%Note:More than one answer could be selected,so the total may exceed 100%.Within the data there are notable nuances,both b

202、y region and organization type.On a regional basis:Climate transition is an even more prominent issue for organizations in the United Kingdom,Australia&New Zealand,and across the IMETA region.A higher proportion of community or public foundations(59%)and faith-based organizations(57%)cite climate tr

203、ansition as a priority social issue,relative to other segments of the sector.In Europe and Latin America,the highest proportion of organizations cite the UN Sustainable Development Goals as the desired focus of increased support through portfolio allocations.Beyond the social issues detailed in our

204、table,organizations priorities also include health inequalities,entrepreneurship,and international rescue and relief.Key findings 4IntroductionForewordContentsKey findings 1 Key findings 2 Key findings 3ConclusionContact usKey findings summary37Gauging risk,building resilienceConclusionOur findings

205、highlight that E&F organizations of all sizes are active in identifying and taking advantage of emerging opportunities,whether from a pure investment structure perspective or through further alignment with the organizations mission or beliefs.The momentum into private markets that we observed in las

206、t years survey continues to gather pace,most prominently into private equity and notably into infrastructure.Through infrastructure allocations,E&F investors can build portfolio resilience against inflation,and also have an opportunity to build-up sustainable and impact allocations.While the data su

207、ggests that private markets remain the preserve of larger organizations,it also indicates that many organizations diversification programs are not yet complete.In our view,gaining the risk-reward benefits of diversifying into a broader range of relevant investments remains the key opportunity for E&

208、F investors.The largest organizations tend to be early adopters,and indeed trendsetters,in investment approaches.Smaller organizations have an opportunity to learn and benefit from this blueprint:while scale can help access investment opportunities,it does not need to be the determining factor.Appro

209、aches to sustainable investment are clearly evolving and it will be interesting to observe how impact investment methods develop over the next year,decade and beyond.Despite the clear trend of increasing sustainable investment allocations,only a small minority of investors have adopted a framework f

210、or decarbonization at the portfolio level or set and implemented a net-zero target.This is an area in which investors may be overlooking the interrelated aspects of of climate change,asset values,physical risks,and societal impacts.Investing over multi-decade even infinite horizons puts portfolios t

211、hrough different tests,but also provides an opportunity to learn from each experience,as well as from peers pursuing similar investment objectives.ConclusionIntroductionContentsForewordKey findings 1 Key findings 2 Key findings 3Contact usKey findings summaryKey findings 438Global Survey Report 2024

212、38Gauging risk,building resilienceContact usIf you would like to discuss the findings within this report in more detail or how we may be able to support your organization,please feel free to contact your Mercer representative.Alternatively,email us at Adeline Tan+852 3476 3834 AsiaGilles Lavoie+1 51

213、4 841 7583 CanadaMichel Meert +32 471 712 514 Continental EuropeRebekah Dunn +61 2 8864 6889 Pacific Paul Fleming+44 20 7178 3373 United KingdomRob Ansari+971 50 2204626 United Arab EmiratesTexas Hemmaplardh+1 212 345 0713 United StatesKey findings 3Key findings 2 Key findings 1 IntroductionConclusi

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