How we manage the funds

Who manages the funds?

When you become a USS member, you start building your pension with us. But who’s actually looking after your money and deciding where to invest? The answer is USS Investment Management Limited (USSIM). They’re appointed by us to be our investment manager. And together, we have a duty of care to invest your contributions for you.

Investments with you in mind

We make investments with long-term investment goals in mind. That’s because we have a legal duty to invest in the best financial interests of our members, so that we’re able to pay you the pension you’ve earned.

Find out more about where we invest.

The investment gurus

Our investment managers invest in both public and private Markets, giving them a global reach. They manage approximately £77.9bn in assets (as at 31 March 2024) across both the Retirement Income Builder (the defined benefit part) and the Investment Builder (the defined contribution part).

USSIM oversee all our money. They also select and monitor a range of external investment managers to look after some of the money. But the biggest proportion of our investments (between 70% and 80%) is directly managed internally by an expert team of in-house investment managers. That means there are specialists managing your contributions. These investment experts can adapt to the ever-changing markets – and help towards a more secure financial future for you.

How we measure success

To help us measure how well we’re doing, we now use what’s called an investment balanced scorecard, which covers six important categories. Each category includes a new set of measures that assess our investment performance more holistically.

There is a scorecard for both the Retirement Income Builder and the Investment Builder. Each one uses the same six categories but with slightly different metrics. These metrics include a range of quantitative risk and return metrics, and qualitative inputs. The purpose of the scorecards is to take a balanced view of performance against the backdrop of our investment objectives and the interests of our members and employers.

The categories include the return on our assets, the way investment risk is managed, the value our in-house investment team add by actively managing our assets, the quality of investment advice, how resilient our investment portfolio is, and our Responsible Investment ambitions. This last one includes things like reaching net zero and the way we integrate environmental, social and governance (ESG) issues into our investment process.

Investment balanced scorecard categories:

We also closely monitor our investment costs. These were are approximately £121m (35%) lower in the calendar year 2022 than the median global peer pension fund, according to the most recent independent analysis by CEM Benchmarking. This demonstrates the value our in-house investment team provide.

Whilst there are costs associated with having an in-house investment team, they’re significantly lower than what we would otherwise have to pay external managers – and we have achieved strong relative returns over the long-term in a cost-effective way. Over the last five years, our investment management costs are £410m (26%) lower than the peer median.

Making Responsible Investments

We’re a long-term, responsible investor with a legal duty to invest in your best financial interests, so we can pay our members’ pensions long into the future. We believe that when our investments are run effectively and their environmental and social risks, like climate change or health and safety, are appropriately managed, risk-adjusted returns can be improved over the long-term.

That’s why we consider the financial impact of environment, social and governance (ESG) issues when we invest. More specifically, we integrate financially material ESG factors into our investment decisions and, as active owners, we work hard to assess how our investments manage these factors through our stewardship activities to encourage improved management and disclosure of ESG issues.

Find out more about responsible investment.

See what we’re talking about

Watch our video for more on how and where we invest, and a little more on how we invest responsibly too.