Aon joins the mansion house compact as chancellor renews support for reform
Aon, a prominent worldwide professional services company, has declared its commitment to the Mansion House Compact, coinciding with Chancellor of the Exchequer Jeremy Hunt’s renewed backing for the agreement during the Mansion House Pensions Summit, a collaborative event between the City of London Corporation and EY.
Marking the latest development, Aon pledges that at least 5% of its defined contribution (DC) funds will target unlisted equities by 2030. This strategy aims to free up more than £50 billion of fresh capital by the decade’s conclusion. This move aligns Aon with major players like Aviva, Scottish Widows, L&G, Phoenix, Nest, Smart Pension, M&G, Aegon, and Mercer, all representing a significant portion of the DC market. These firms are united in their commitment to enhancing saver returns and empowering rapid-expansion sectors such as fintech and biotech to flourish and expand within the UK.
The Summit emphasizes the necessity of a unified front within the pension sector, inviting pivotal representatives across the industry, trade organizations, specialist market advisors, and the government to advance the Compact’s objectives and tackle both cultural and logistical hurdles inhibiting further investments in unlisted equities.
The event will host several roundtables and panel discussions, focusing on the willingness to invest in unlisted equities, strategies to expedite these investments, and methods for the pension infrastructure to adapt, ensuring the requisite instruments, expertise, and personnel are in place to streamline investments in unlisted equities.
Nicholas Lyons, Lord Mayor of the City of London, commented:
“The UK excels in sectors like tech, biotech, and life sciences, yet often, its citizens don’t gain the full rewards from these companies’ growth. The Mansion House Compact offers a crucial turning point for pension reforms, enabling British businesses to expand and go public domestically, simultaneously enhancing pension yields for savers.
The growing traction behind the Compact is essential for escalating institutional investments in unlisted equities. I applaud the expanding roster of participants and look forward to upcoming advancements.”
Chris Hayward, Policy Chairman at the City of London Corporation, remarked:
“The Mansion House Compact showcases the City of London Corporation’s vital role in uniting industry and government.
Nevertheless, these pensions summit represents a decisive juncture to evaluate the Compact’s journey preceding the Autumn Statement and to confront the obstacles in broadening this initiative’s scope. Our report, Vision for Economic Growth, identifies pension reform as a central mechanism for elevating investments in high-growth British firms, thereby spurring prosperity nationwide.”
Jeremy Hunt, Chancellor of the Exchequer, stated:
“July’s Mansion House Compact signature was a pivotal instance, reflecting the pension sector’s dedication to securing superior returns for their members. I am thrilled that Aon is aligning with the Compact, ensuring its 180,000 members can profit from the expansion of the UK’s most dynamic, high-growth firms.
Although, this represents British financial prowess fueling British expansion, promising enhanced retirement funds and more robustly financed public amenities for UK residents.”
Julie Page, CEO of Aon UK, shared:
“By diversifying investment markets and permitting DC pension plans to engage with new ventures like unlisted equities, we anticipate an upsurge in future asset returns, culminating in more favorable results for pension contributors. We wholeheartedly endorse the Mansion House Compact’s objectives, and we’re confident this approach suits Aon’s UK DC solutions, poised to manage £7 billion in assets and serve 180,000 members – our topmost concern.”
Axe Ali, EMEIA Financial Services Private Equity & Venture Capital Leader at EY, added:
“Funneling more funds into the UK’s top-tier, innovative enterprises should create a ripple effect throughout the national economy, benefitting pension savers by diversifying equity investments, enhancing Defined Contribution results, and opening new financial channels for UK businesses.
From our joint authorship of the report ‘Powerful Pensions: Unlocking DC Pension Capital for UK Tech Growth’ with the City of London Corporation, to our ongoing support for the Mansion House Compact and Pensions Summit, EY stands behind efforts that simultaneously generate value for pension savers and the broader economic landscape. It’s heartening to witness more institutional investors embracing this philosophy, accelerating the Compact’s momentum and ultimately forging a more resilient UK economy for the long haul.”
