Investing

GIPS® Standards Asset Owner Performance Survey Report

29/05/2025
admin

The CFA Institute “2024 GIPS® Standards Asset Owner Performance Survey Report” (Asset Owner Survey Report) reveals that asset owners worldwide are increasingly embracing the Global Investment Performance Standards (GIPS Standards). The Survey Report’s findings show not only a rise in awareness and compliance with these industry standards but also a broader trend among asset owners toward greater transparency, accountability, and alignment with best practices in investment performance reporting.

The survey, which was global in scope, was conducted June – September 2024 by CFA Institute in collaboration with the GIPS® Standards Asset Owner Subcommittee. It expands on a U.S.-focused study conducted in 2020 by CFA Institute in conjunction with the United States Investment Performance Committee (USIPC), which is the GIPS Standards Sponsor in the United States.

The survey gathered responses from 63 asset owners across the Americas, EMEA (Europe, Middle East, and Africa), and Asia Pacific. Survey participants included a mix of pension funds, endowments, insurance companies, sovereign wealth funds, and family offices. The survey’s goal was to ascertain how these organizations manage and report investment performance and how they use the GIPS standards when doing so.

The GIPS Standards

The GIPS standards were originally designed to bring uniformity and integrity to performance reporting by investment managers. However, a significant 2020 update introduced a version tailored specifically for asset owners — entities that typically do not compete for clients but still face oversight and accountability because they often manage substantial portfolios. This version of the GIPS Standards helps ensure consistency in how asset owners calculate and present returns across internally and externally managed assets.

The latest survey results paint a promising picture. Familiarity with the GIPS standards by asset owners is widespread, and compliance claims are steadily increasing. This reflects a growing recognition among asset owners of the benefits that these global standards offer — not just in terms of performance presentation, but also when selecting and evaluating external managers, especially in increasingly complex investment environments involving both liquid and illiquid assets.

Here are six key takeaways from the report:

  • Widespread Awareness, Growing Compliance: An impressive 93% of respondents reported at least some familiarity with the GIPS standards. Of those, 31% already claim compliance, up from under 21% in 2020, and another 9% plan to do so.
  • Stronger Oversight of External Managers: Asset owners are increasingly prioritizing GIPS compliance when selecting external managers. For liquid asset classes, such as equities and fixed income, 68% either require or ask about GIPS compliance during manager selection. For illiquid asset classes, including private equity and real estate, that number stands at 41%.
  • Enhanced Return Transparency: Most asset owners (56%) report time-weighted returns (TWRs) to their oversight bodies, which are mandated by the GIPS standards. However, 42% go a step further and also provide money-weighted returns (MWRs), offering a more complete picture of investment performance that accounts for the timing and size of cash flows.
  • Many Close to Compliance Without Declaring It: Interestingly, 59% of asset owners already present net-of-fee returns to their oversight bodies — one of the core requirements of the GIPS standards. This indicates that many organizations are already doing much of the work required for GIPS compliance and may simply need to formalize their reporting to claim compliance officially.
  • Illiquid Assets Are a Major Focus: More than 90% of asset owners surveyed have exposure to illiquid investments, and nearly half (45%) allocate between 26% and 50% of their assets to such holdings. This reinforces the need for clear and consistent performance standards that can accommodate the unique characteristics of these asset classes.
  • Diverse Benchmarking Practices: Benchmark use is evolving. While 59% of respondents use only one benchmark, 41% use multiple benchmarks, with some employing as many as five. The most common benchmarks are weighted according to policy asset-class targets (used by 61%).

Overall, the 2024 survey shows a growing commitment among asset owners to adopting global standards that support fair, consistent, and transparent investment reporting. As GIPS compliance continues to rise, the pressure on external managers to align with the premier global performance standards will likely increase as well.

CFA Institute sees this as an opportunity to better communicate the practical and reputational benefits of GIPS compliance — not only for asset owners themselves but for the broader investment industry.

#GIPS #Standards #Asset #Owner #Performance #Survey #Report