Details of your study will be unveiled at the Private Assets conference on 1 October. What are your main findings?
Patrick Augustin (PA). – “The 2024 Draghi report on EU competitiveness argues that the EU should channel household savings more effectively into productive investments such as equities, real estate and infrastructure. These require risk-taking, so we refer to them as risk capital, unlike deposits and fixed income. In our study, we examine countries that have undertaken pension capitalisation reforms over the past 30 years. We show that these countries have accumulated two to three times more risk capital than those with pay-as-you-go systems, such as France and Germany.
We also find that countries with capitalised pension regimes have taken different paths to building reserves of risk capital. For example, Canada has focused on strengthening its public pension system, while Australia has doubled down on its occupational pension system.
Could you give concrete examples of the current barriers to directing more capital towards risk assets?
PA – “Barriers exist at policy, institutional and household levels. Public pensions often face explicit risk limits or restrictive investment rules. Even among advanced occupational funded pension systems such as in the Netherlands, regulatory requirements like Solvency II constrain risk-taking. At the household level, stock market participation remains low in countries with limited financial literacy, weak tax incentives and inadequate choice architecture.”
How do your findings on the mobilisation of risk capital connect specifically to investments in private assets?
Sébastien Betermier (SB). – “Countries that have accumulated substantial capital through funded pension schemes also invest more in private infrastructure. Three factors explain this. First, greater capital accumulation enhances risk tolerance. Second, infrastructure is particularly well suited to pension funds, providing steady, inflation-linked income with an illiquidity premium. Third, scale is crucial: large funds can develop in-house expertise and allocate to more complex asset classes, including infrastructure.
Do Anglo-Saxon funds have an advantage over their continental counterparts when it comes to investing in infrastructure?
SB – “Anglo-Saxon funds have built a long track record in private infrastructure. One reason is access: governments in countries such as the UK and Australia opened assets such as toll roads, ports and electricity networks to private investors in the 1990s. Another reason is strategic: infrastructure generates long-term, inflation-linked income streams that are especially valuable for defined-benefit pension funds. A further advantage is experience itself. Early investments created knowledge, expertise and scale. Today, large Anglo-Saxon funds have decades of experience in the infrastructure market.”
The Swedish example
“Sweden stands out for its strong level of stock market participation across public pensions, occupational pensions and voluntary savings,” notes Patrick Augustin. The country shows a marked gap with other European states in accumulated risk capital: “For example, the average worker in Germany has accumulated €66,000 of risk capital, compared with €250,000 in Sweden.”
In the CSSF’s 2024 annual report, its CEO, Claude Marx, also highlights Sweden’s Investeringssparkonto as a model for the savings systems of tomorrow.
This article was written for the supplement of Paperjam magazine's October 2025 issue, published on September 24. It is published on the site to contribute to the full Paperjam archive. .