Taiwan’s government-run retirement system last week selected five external managers for its second overseas investment mandate for fiscal 2026, its Global Climate Transition Passive Infrastructure Securities strategy.
The Bureau of Labor Funds, on behalf of the Labor Pension Fund, Labor Insurance Fund and the National Pension Insurance Fund, mandated equal amounts to each of five global managers: Amundi Asset Management, BNP Paribas Asset Management Europe, Geode Capital Management LLC, Northern Trust Asset Management Australia Pty. Ltd. and State Street Global Advisors Singapore Ltd., according to a statement from the BLF.
Each manager will get a total of $600 million to invest—$400 million each from the Labor Pension Fund and $100 million each from the Labor Insurance Fund and the National Pension Insurance Fund. The total allocation was $3 billion for a term of five years, according to the BLF.
The fund managers each will use the FTSE Global Core Infrastructure ex-China TPI Climate Transition Index as their benchmarks, targeting companies with forward-looking climate transition management capabilities.
“Through a passive investment approach, the mandate aims to participate in the global infrastructure market at relatively lower cost,” the BLF stated. The mandate will also serve “the dual objectives of supporting companies in advancing structural transition and capturing investment growth opportunities.”
The fund managers will also aim to achieve the long-term objectives of the labor funds and the National Pension Insurance Fund, which are to consistently earn stable returns.
“This mandate aligns with international trends by focusing on climate transition infrastructure, combining stable income characteristics with structural growth in electricity demand,” the BLF stated in March, when it announced the search that this mandate fulfills. “It aims to strengthen the balance of alternative investments within the overall portfolio, enhance diversification, and simultaneously support corporate transition while capturing investment growth opportunities.”
The investment comes against the backdrop of the rapid development of artificial intelligence, cloud computing and the digital economy, which have led to the expansion of investment opportunities in related infrastructure.
“Such assets typically feature stable cash flows, essential demand, and resilience to economic cycles, which help generate long-term returns while enhancing portfolio defensiveness,” the agency stated in March. “In addition, under the global energy transition trend, power and related infrastructure are gradually shifting toward low-carbon development.”
A version of this article originally appeared in our sister publication, Financial Standard, which, like CIO, is owned by ISS STOXX.
Tags: Asset Management, climate, Taiwan