Achmea IM: Impact investing with private equity under the Wtp

September 22, 2025

^{This article was originally written in Dutch. This is an English translation.}

Impact investing is increasingly on the agenda of Dutch pension funds. Private equity is regularly mentioned as an instrument for combining social impact with attractive financial returns. Active ownership in companies also offers opportunities to focus on this even more specifically. Financial Investigator spoke with Ralph Engelchor, Coen van de Laar and Mark Leeijen of Achmea Investment Management about this development and the expected effects of the Future Pensions Act (Wtp).

By Esther Waal

What is the role of private equity in the new pension system?

Mark Leeijen: 'Private equity is an asset class with high return potential. This makes it a valuable addition to the return portfolio. The new pension contract places greater emphasis on absolute returns, which makes private equity even more relevant. Private equity is particularly suitable for younger participants, who have a long investment horizon. In addition, the asset class offers the opportunity to fulfil their preference for sustainability and socially responsible investing.

Despite the illiquid nature of private equity, we see opportunities for an additional allocation to this asset class within the new pension contract. This investment category is particularly well suited to the collective portfolio of the solidarity-based contribution scheme, the SPR. However, the FPR, the flexible contribution scheme, also offers scope for including private equity in the return portfolio, provided that its illiquidity is taken into account.

Impact investing via private equity is becoming increasingly mature. There are more and more specialised managers and funds available, making it more attractive for pension funds to invest in this area.'

Will impact investing become more important under the Wtp?

Coen van de Laar: 'Under the Wtp, an age-dependent investment policy applies. In order to determine the risk appetite of participants, pension funds ask about their risk preferences. We see that pension funds are taking this opportunity to also ask participants about their sustainability preferences. Moreover, transparency and communication are becoming even more important under the Wtp. This makes participants more aware of the companies in which they invest. As a result, participants often want their pension money not only to generate a good financial return, but also to make a positive contribution to a sustainable world.'

What is the potential impact of private equity?

Ralph Engelchor: 'Private equity is particularly well suited to making a positive impact thanks to its active ownership and long-term focus. Pension funds can use specialist managers to strategically guide companies on issues such as sustainability, social inclusion and technological innovation.

The broad investment universe of private equity makes it possible to achieve impact at different stages of business development, from start-ups to mature companies.

A wide range of impact themes are accessible, including health, climate, food security and the circular economy (see Figure 1). The growth of impact funds significantly increases investment opportunities. This means that private equity is increasingly well suited to building a well-diversified impact portfolio.'

Can financial and social returns be combined?

Engelchor: 'Financial and social returns can be combined, but this requires a careful approach. Private equity impact funds often have the same high absolute return targets as regular private equity. We also maintain our long-term expectations of a 3% excess return over listed shares for private equity impact investments.

Venture capital, growth capital and buy-outs are private equity categories that lend themselves well to impact investing. Impact opportunities in the venture capital category can often be characterised as highly innovative and risky. In general, pension funds prefer growth capital and buyouts. These offer a relatively stable risk profile and good opportunities for impact realisation. Themes such as health and sustainable energy are interesting from a risk-return perspective because of their mature markets and strong commercial models. Successful impact investments require clear agreements on objectives, transparent impact measurement and a good spread across funds, regions and vintages.'

How do you mitigate risks and what are the practical considerations for pension funds?

Van de Laar: 'Diversification across funds, regions, sectors and vintages is essential to limit valuation and concentration risks. Furthermore, a careful selection process for fund managers is crucial. Attention must be paid to experience, impact strategy and transparency, especially in a market with limited historical data. Clear agreements on impact objectives, monitoring and evaluation ensure accountability and make it possible to monitor the balance between return and impact.'

Engelchor: 'Investing in private equity under the Wtp entails a number of practical considerations. For example, illiquid investments are associated with higher costs. Pension funds must critically assess whether the expected added value outweighs these costs. We are seeing that pension funds are increasingly willing to incur slightly higher costs and include private equity in the available investment universe because of their desire to make an impact and because of the potential returns. Open-end funds and co-investments can offer cost-efficient alternatives in this regard.'

Leeijen: 'Insight at cohort level is important in order to determine the scope for illiquid investments such as private equity. With a young participant base, the pension fund’s investment horizon is long. This offers many opportunities for private equity. Finally, monitoring illiquidity within the Wtp is important. Within the FPR, a liquid buffer is essential to be able to execute daily transactions and payments smoothly without being forced to sell illiquid investments.'