Stichting Pensioenfonds Zorg en Welzijn
Encyclopedia
Stichting Pensioenfonds Zorg en Welzijn (known as PFZW, formerly PGGM, translation: "Pension Fund for Care and Well-Being") is the second largest pension fund in the Netherlands
. As of 31 December 2009, PFZW had total assets under management
of €86.1 billion ($123 billion).
PFZW's predecessor, PGGM, was founded in June 1969 through the combination of several smaller Dutch
pension funds in the healthcare industry. In 1970, PGGM assumed responsibility for the pensions of employees throughout the healthcare and social work
sectors in the Netherlands. In 1972, PGGM moved to its current headquarters in Zeist
, Netherlands.
PFZW is as a non-profit foundation, controlled by trade unions and employers from the healthcare and social work sectors. At the end of 2006, the governing board of what was then known as PGGM adopted a separation between its policy (structuring of pensions) and implementation (managing of assets and payment) functions. The pension fund (the foundation) continues to formulate pension policy, but was renamed Stichting Pensioenfonds Zorg en Welzijn (PFZW), and a newly created cooperative
PGGM now manages the fund’s €86.1 billion of assets under management
. This separation, which took effect in January 2008, was taken in response to new legislation passed in the Netherlands that would limit PGGM’s ability to offer related financial services
.
) of 8.0% since 1970 (2007: 9.3%).
Based on assets, PFZW is the second largest pension fund in the Netherlands, behind Stichting Pensioenfonds ABP
. More broadly, PFZW stands in the top 5 of European pension funds and in the top 15 globally, based on both number of plan participants and assets under management
.
, another large Dutch pension fund, considered a spin-off of their asset management businesses. The two pension funds coordinate their activities in private equity
through AlpInvest Partners
, one of the largest investors globally in the private equity asset class.
In 2008, PGGM announced that it would divest itself of its holding in the NYSE-listed Chinese operator PetroChina
(PTR). PGGM announced that it was making the decision because the Chinese operator is involved in human rights violations in the Darfur
region of Sudan
.
, fixed income
, real estate
, commodities, hedge funds and private equity
.
Netherlands
The Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...
. As of 31 December 2009, PFZW had total assets under management
Assets under management
Assets under management is a financial term used denote the market value of funds being managed by a financial instutition on behalf of its clients, investors, depositors, etc. This metric is a sign of size and success against competition...
of €86.1 billion ($123 billion).
PFZW's predecessor, PGGM, was founded in June 1969 through the combination of several smaller Dutch
Netherlands
The Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...
pension funds in the healthcare industry. In 1970, PGGM assumed responsibility for the pensions of employees throughout the healthcare and social work
Social work
Social Work is a professional and academic discipline that seeks to improve the quality of life and wellbeing of an individual, group, or community by intervening through research, policy, community organizing, direct practice, and teaching on behalf of those afflicted with poverty or any real or...
sectors in the Netherlands. In 1972, PGGM moved to its current headquarters in Zeist
Zeist
Zeist is a municipality and a town in the central Netherlands, located east of the city of Utrecht.-Population centres :*Austerlitz*Bosch en Duin*Den Dolder*Huis ter Heide*Zeist- The town of Zeist :...
, Netherlands.
PFZW is as a non-profit foundation, controlled by trade unions and employers from the healthcare and social work sectors. At the end of 2006, the governing board of what was then known as PGGM adopted a separation between its policy (structuring of pensions) and implementation (managing of assets and payment) functions. The pension fund (the foundation) continues to formulate pension policy, but was renamed Stichting Pensioenfonds Zorg en Welzijn (PFZW), and a newly created cooperative
Cooperative
A cooperative is a business organization owned and operated by a group of individuals for their mutual benefit...
PGGM now manages the fund’s €86.1 billion of assets under management
Assets under management
Assets under management is a financial term used denote the market value of funds being managed by a financial instutition on behalf of its clients, investors, depositors, etc. This metric is a sign of size and success against competition...
. This separation, which took effect in January 2008, was taken in response to new legislation passed in the Netherlands that would limit PGGM’s ability to offer related financial services
Financial services
Financial services refer to services provided by the finance industry. The finance industry encompasses a broad range of organizations that deal with the management of money. Among these organizations are credit unions, banks, credit card companies, insurance companies, consumer finance companies,...
.
Scope of the fund
At the end of 2009, PFZW had 22,000 affiliated employers (employees are enrolled automatically), more than 1.9 million participants. The fund has an investment portfolio of over €85 billion and total annualized return (IRRInternal rate of return
The internal rate of return is a rate of return used in capital budgeting to measure and compare the profitability of investments. It is also called the discounted cash flow rate of return or the rate of return . In the context of savings and loans the IRR is also called the effective interest rate...
) of 8.0% since 1970 (2007: 9.3%).
Based on assets, PFZW is the second largest pension fund in the Netherlands, behind Stichting Pensioenfonds ABP
Stichting Pensioenfonds ABP
Stichting Pensioenfonds ABP , frequently referred to as ABP, is the pension fund for government and education employees in the Netherlands...
. More broadly, PFZW stands in the top 5 of European pension funds and in the top 15 globally, based on both number of plan participants and assets under management
Assets under management
Assets under management is a financial term used denote the market value of funds being managed by a financial instutition on behalf of its clients, investors, depositors, etc. This metric is a sign of size and success against competition...
.
Investments
PGGM manages the bulk of its investments in-house on behalf of PFZW. In 2006, PGGM and Stichting Pensioenfonds ABPStichting Pensioenfonds ABP
Stichting Pensioenfonds ABP , frequently referred to as ABP, is the pension fund for government and education employees in the Netherlands...
, another large Dutch pension fund, considered a spin-off of their asset management businesses. The two pension funds coordinate their activities in private equity
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
through AlpInvest Partners
AlpInvest Partners
AlpInvest Partners is a private equity investment manager and at the end of 2009 globally managed over €42 billion ....
, one of the largest investors globally in the private equity asset class.
In 2008, PGGM announced that it would divest itself of its holding in the NYSE-listed Chinese operator PetroChina
PetroChina
PetroChina Company Limited is a Chinese oil company and is the listed arm of state-owned China National Petroleum Corporation , headquartered in Dongcheng District, Beijing. It is China's biggest oil producer, and was the world's most valuable company by market value as of September 28th 2010...
(PTR). PGGM announced that it was making the decision because the Chinese operator is involved in human rights violations in the Darfur
Darfur
Darfur is a region in western Sudan. An independent sultanate for several hundred years, it was incorporated into Sudan by Anglo-Egyptian forces in 1916. The region is divided into three federal states: West Darfur, South Darfur, and North Darfur...
region of Sudan
Sudan
Sudan , officially the Republic of the Sudan , is a country in North Africa, sometimes considered part of the Middle East politically. It is bordered by Egypt to the north, the Red Sea to the northeast, Eritrea and Ethiopia to the east, South Sudan to the south, the Central African Republic to the...
.
US investment activities
In the United States, as in Europe, PGGM is a major investor in financial markets including public equityStock market
A stock market or equity market is a public entity for the trading of company stock and derivatives at an agreed price; these are securities listed on a stock exchange as well as those only traded privately.The size of the world stock market was estimated at about $36.6 trillion...
, fixed income
Fixed income
Fixed income refers to any type of investment that is not equity, which obligates the borrower/issuer to make payments on a fixed schedule, even if the number of the payments may be variable....
, real estate
Real estate
In general use, esp. North American, 'real estate' is taken to mean "Property consisting of land and the buildings on it, along with its natural resources such as crops, minerals, or water; immovable property of this nature; an interest vested in this; an item of real property; buildings or...
, commodities, hedge funds and private equity
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
.