Nokia Named Mercer as OCIO for US Retirement Plans

Finnish telecom company Nokia Corp. appointed Mercer Investments, part of Mercer LLC, a Marsh McLennan company, as its outsourced CIO and investment fiduciary for its Nokia of America defined benefit pension funds, defined contribution retirement plan and other-post employment benefit portfolios, totaling nearly $30 billion, a spokesperson for Nokia confirmed Tuesday to CIO.

Jeanmarie Grisi, CIO of Nokia of America Corp., will retire from the company in March 2025, according to a source. She has worked at Nokia and its predecessor firm, Alcatel-Lucent, for nearly 25 years.

According to the plan year 2023 Form 5500 for the Nokia Retirement Income Plan, the company entered into an agreement with Mercer in July to outsource the asset management of its plans to the firm. The target date for the commencement of Mercer acting as the fiduciary manager of the plan was listed as October 1.

Nokia’s U.S. pension plan had $13.864 billion in assets under management, with 90,189 participants. Per Nokia’s Form 5500, the plan had 7,492 active participants, 61,934 participants retired or separated from the company and receiving benefits, and 20,763 retired or separated participants entitled to benefits in the future.

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The Nokia Savings/401(k) Plan, with $9.082 billion in assets and 25,956 participants, was also outsourced to Mercer as the plan’s 3(38) fiduciary investment manager, as were the OPEB obligations, which had assets valued at about $737 million, according to the company’s 2023 annual report and a company source.

As corporate pension funds continue a streak of funding surpluses, having more assets than they have liabilities, more are choosing to outsource the management of their assets.

According to CIO’s 2024 Outsourced Chief Investment Officer Survey, 30% of corporate pensions outsource or plan to outsource their assets to an OCIO provider. Among the reasons to outsource, across all types of plans, lack of internal resources was the top reason, followed by making faster implementations and decisions, as well as the need to increase returns.

2024 Outsourced Chief Investment Officer Survey

How Managers of Pension Funds, OCIOs Are Approaching Risk

Tags: Jeanmarie Grisi, Mercer, Nokia, OCIO, outsourced chief investment officer

As the 29th United Nations Climate Change Conference approaches this month, the Net-Zero Asset Owner Alliance, an initiative of institutional investors committed to achieving net-zero investment portfolios, has provided its fourth progress report. Asset owners representing $9.4 trillion in assets out of $9.5 trillion represented by the NZAOA have set targets to achieve net-zero portfolios by 2050.

The NZAOA details three ways asset owners can influence the move to a net-zero emissions environment (one in which all greenhouse gas emissions are offset by greenhouse gas removal elsewhere): allocating capital to businesses focused on the energy transition; stakeholder engagement; and contributing to changing the norms and standards in the investment ecosystem.

In the report, the NZAOA noted that emissions financed across members’ portfolios declined to 254 million tons of carbon dioxide from 260 million tons the prior year. The alliance seeks decarbonization targets aligned with the 2016 Paris Agreement on climate change.

Across the alliance, 81 of 88 members that have set targets, and financed emissions have fallen annually by approximately 6%, both of which the NZAOA found in line with the 1.5 degrees Celsius pathway requirements of the Intergovernmental Panel on Climate Change, which aims to limit global warming to 1.5 C by 2030, a limit the IPCC wrote is needed to reach net zero by 2050.

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Asset owners across the NZAOA have invested $555 billion in climate solutions, as of 2023, according to the report. A majority of these assets were invested in corporate bonds and real estate.

While the alliance noted progress in portfolio decarbonization among its members, the report stated that the transition to net zero is not happening fast enough in the real economy.

“Despite significant advances in asset owner portfolio decarbonization, the pace of transition in the real economy remains insufficient, with global emissions continuing to rise each year,” said Wendy Walford, head of climate risk at Legal & General, in a statement. “As long-term investors, we see the difference between governments’ climate commitments and current policies as unsustainable, and a decisive shift in policy is required to align policy frameworks with the net-zero transition more widely.”

The NZAOA boasts some of the world’s largest institutional investors among its members, but like the Climate Action 100+ Initiative, it has seen a number of departures. In September, Danish pension fund PKA, with $59 billion in assets, left the alliance. Cbus, the Australian construction and building unions superannuation fund ($61.93 billion) and the Church of England Pensions Board left the alliance in 2022 and 2023, respectively.

Despite the departures, NZAOA’s 88 members are an increase from the 74 members with $10.6 trillion in AUM outlined in its September 2022 progress report. At that time, asset owners representing $7.1 trillion had adopted intermediate net-zero targets. In September 2019, the alliance had 12 members, representing $2.4 trillion in assets in total.