National Pension Service Overhauls Fund Management System... Investment Committee to Be Split into Two

Enhancing Expertise by Asset Type: Public vs. Private Investments

A major overhaul of the system is being pursued to manage the massive National Pension Fund, which exceeds 1,200 trillion won, in a more professional and efficient manner. The core of this reform is to split the existing single "Investment Committee," which has served as the 'investment control tower,' into two separate bodies: the "Public Asset Investment Committee" and the "Private Asset Investment Committee."

According to the National Pension Service on November 6, this restructuring aims to enhance the expertise and speed of decision-making by aligning with the characteristics of the assets being invested in. This measure is intended to resolve inefficiencies that arise when both public and private assets, which have fundamentally different characteristics, are handled by a single committee, and to follow the standards of leading global pension funds.

The Public Asset Investment Committee will be dedicated to traditional asset classes such as stocks and bonds, which require agile responses to rapidly changing market conditions. Meanwhile, the Private Asset Investment Committee will focus on alternative investments such as real estate, infrastructure, and private equity funds (PEF), which require long-term perspectives and complex analysis, establishing in-depth strategies and making long-term investment decisions.

The National Pension Service will also begin a comprehensive review of its overall fund management system. Starting at the end of this year, it plans to engage professional consulting services to analyze portfolio composition systems and establish mid- to long-term improvement directions, taking into account the fund's long-term investment horizon. The National Pension Service is already pursuing new strategies to diversify investment returns, such as introducing a "reference portfolio" (65% risk assets, 35% safe assets) and applying a "smart beta strategy."

Despite uncertainties in the financial markets, including U.S. tariff policies, the National Pension Service achieved a return of 4.08% (49.8 trillion won) in the first half of this year.