African pension funds are increasingly stepping beyond traditional asset classes and embracing infrastructure and alternative investments as strategic tools for long-term value creation. The African Infrastructure and Alternative Investment Excellence Programme in South Africa and Botswana provided trustees and pension leaders with practical insights on governance, fund manager oversight, risk management, and sustainable infrastructure funding models. This report captures the key lessons and actionable frameworks that can help schemes strengthen returns while protecting member interests.
Key Learning Outcomes
- Member-centric investment approaches
- Rigorous fund manager selection process and criteria
- Robust governance frameworks
- Distinction between funding and financing infrastructure projects
This programme provided delegates with actionable frameworks to:
- Optimize investment decisions
- Maximize member value
- Manage risks that come with alternative asset allocation away from traditional asset classes
Key recommendations/ action items for schemes to adopt
These items provide a roadmap for transforming pension fund investment approaches to better serve member interests through enhanced returns, reduced living costs, and strengthened community infrastructure—while maintaining prudent risk management and fiduciary standards. Implementation requires sustained commitment to capability building, governance strengthening, and stakeholder alignment.
1. Adopt Member-centric investment philosophies.
How? Evaluate projects through dual lenses; Risk adjusted returns and direct member benefits such as reduced cost of living for the members, improved community infrastructure such as schools and hospitals around where members live.
2. Structure infrastructure investments to fund, never finance.
How? Use PPP models to avoid operational risks while maintaining guaranteed returns from the government.
3. Develop standardized fund manager scorecards.
What does the scorecard cover? Shareholder alignment, fee structures, strategic objectives and sustainability of the investment process.
4. Implement quarterly reconciliation processes.
How? Capital release schedules must be tied to verified and measurable milestones and fund manager co-investment requirements (1-5% of allocation)
5. Establish clear valuation protocols for unlisted assets.
How? Specify independent valuators, minimum frequencies and dispute resolution mechanisms.
7. Set minimum real return thresholds.
How? The threshold must exceed guaranteed returns plus inflation. Conduct an annual stress test against inflation scenarios.
8. Adopt tiered ESG frameworks.
How? Frameworks must emphasize engagement over exclusion. With hard exclusions for serious ethical violations
9. Pension Funds in Africa should access offshore listed assets.
How? Specialized managers like Allan Gray and One Acre Capital that have deep global research capabilities & ensure adequate geographical and currency diversification
10. Consider tiered account structures.
How? Differentiate member liquidity needs from long-term retirement accumulation thus aligning investment horizons accordingly.
11. Develop multi-year capacity Building plans.
How? Plans should address governance expertise, analytical tools, and monitoring systems required for alternative investment oversight.
Delegates undergoing training at the African Infrastructure and Alternative Investment Excellence Programme - South Africa & Botswana
Key Learning areas from the program
- Investment philosophy and structure
- Fund Manager selection and governance
- Risk management and valuation
- Market context and opportunities
- Operational frameworks
Go beyond the highlights, we have prepared a comprehensive, in-depth report unpacking the full learning areas, practical frameworks, and implementation insights shared during the programme.
Request the detailed breakdown and have it delivered directly to your e-mail here: training@finnettrust.com
As pension funds navigate the growing complexity of alternative investments and infrastructure allocations, strong governance, technical expertise, and disciplined oversight are no longer optional — they are essential.
Building trustee capacity is the foundation of sound decision-making.
At Finnet, we remain committed to equipping trustees and pension leaders with the practical knowledge, regulatory insight, and strategic frameworks required to oversee alternative investments confidently and responsibly. Through our specialized trustee training programmes, we continue to support pension schemes in strengthening governance, enhancing investment oversight, and ultimately delivering sustainable value to members.
For schemes seeking structured, practical, and forward-looking trustee training, Finnet remains your trusted partner.