The unrealized capacity

Worldwide, pensions control around $56 trillion in assets—a substantial fraction of gross global product.  Most of this money is captured in the securities trading markets, where it has no place.

Pensions have an unrealized capacity to curate an equitable world—not only for their members but also, indirectly, for everyone.

Since 1970, however, most pension fiduciaries have ceded control of their funds to asset managers, who play the markets to deliver a desired rate of return.

This speculation includes profit extraction from growth in the valuation of companies whose operations are deleterious to Earth’s capacity to support its people.

This is a dereliction of fiduciary duty.

All of us are affected:

Making an equitable world

Pensions and other socially purposed funds, such as endowments and sovereign wealth funds, are constituted to be stewards of natural and social capacity, entrusted as they are with both the discretionary power, and the duty, to flow trillions of dollars of our savings into programmatic investments in the real economy.

Pensions don’t need an exit by sale: they need actuarial cash flows. A vast opportunity exists to open a new fiduciary channel of investment, marrying ‘forever money’ with ‘forever projects’ that people need. 

It’s a match made in heaven, and a true fulfilment of fiduciary duty.  If realized, it will transform the economy and society. 

Capacity Finance aims to help pensions and other socially purposed funds bring about this future.

But how?