The performance of the management of the UN Pension Fund's assets is assessed using three key metrics established by the Fund's governance structure. Additionally, performance of the investments is also measured against peers, using a review performed by CEM Benchmarking, a leader in global pension fund analyses.

All indicators are currently positive, confirming the effectiveness, the efficiency and the safety of the Funds’ investments.

Investment performance

1. Long-term absolute return: the Fund’s Office of Investment Management (OIM) has an objective to meet or exceed a 15-year real rate of return in US dollars set at 3.5%. As of 30 September 2023, the Fund's 15-year real rate of return stands at 3.6%, which exceeds the target and demonstrates the sound Fund’s investment performance over the long-term.
2. Short-term relative return: The Fund also seeks to meet or exceed the nominal return of its Policy Benchmark, as set in the Investment Policy Statement, over a 3-year period. Despite market volatility over the last three years, as of 30 September 2023, the Fund’s 3-year nominal rate of return is 3.4%, outperforming the Policy Benchmark’s return of 3.0% by 40 basis points.

Detailed information on the monthly evolution of the long and short-term return metrics can be found on our website.

Cost of investment

• Total cost of investment: Starting from the 2024 Budget cycle, the UN Pension Fund’s Office of Investment Management (OIM) will report to the United Nations General Assembly the total cost of its investment activities; with the aim to be equal to, or below the median cost of its peers, as measured through the CEM Benchmarking study. The median cost for managing the investment of the Fund’s assets against peers that will be used as a metric for 2024 is 41 basis points against the assets under management. In 2022, the total cost of investment for the UNJSPF was 32.7 basis points, which was below the peer median cost.

This new metric will be made public on an annual basis on the Fund’s website.

CEM Benchmarking Study

Besides the three metrics described above, the United Nations General Assembly requested in 2022 (resolution A/RES/76/246) that OIM should conduct a comparison of the UN Pension Fund's investment performance with other global pension funds. To this end, OIM engaged CEM Benchmarking, a leader in global pension fund analysis, to use their peer review that compares the results of the Fund’s performance in relation to other global pension funds.

The 2022 CEM Benchmarking analysis, that has just been released, compared the UN Pension Fund's performance and total cost of investments against:

1. A global universe of 277 pension funds, with assets ranging from $0.1 to $1,740.3 billion, representing a total of USD $11.6 trillion. The median fund size is $8.6 billion. 
2. A peer group of 19 global funds with assets under management ranging from $48.3 to $127.8 billion, with a median size of $82.4 billion.

The main findings of the 2022 CEM Benchmarking analysis confirmed the Fund's:

• Effectiveness: The 5-year net total nominal return of the portfolio was 4.2%, surpassing both the global median of 3.3% and the peer median of 3.9%.
• Efficiency: The 2022 total investment cost of 32.7 basis points was lower than the theoretical benchmark cost of 34.0 basis points, indicating that the Fund incurred lower costs for services compared to its peers. In absolute terms, the Fund's total investment cost was 29% lower than the peer median of 45.8 basis points.
• Safety: The asset risk of the portfolio was 10.8%, slightly higher than the peer average of 10.1%. The asset-liability risk was 11.8%, close to the peer average of 11.7%.

The 2021 CEM benchmarking report, published earlier this year, similarly highlighted the UN Pension Fund's positive returns on investments and lower management costs compared to its peers (see here).

To download the 2022 CEM Investment Benchmarking Analysis, click here.