In a letter to shareholders, BlackRock chairman and chief executive Laurence D Fink said the investment manager has an “obligation to be a strong voice in public debate” on retirement issues, given that “two thirds of the assets that BlackRock manages support people in their retirement”.
“I believe that bold policy ideas must be considered, such as the compulsory retirement savings model used in Australia's superannuation system,” Mr Fink said.
“Pension funds also should consider a broader range of investments, including alternatives and non-traditional fixed income, to achieve the returns they need to meet their liabilities.”
In addition, Mr Fink suggested that investment in infrastructure may help address the world’s “longevity crisis” and the problem of “persistent unemployment”.
“Around the world, the energy revolution; the aging of roads, rail links, airports and other transportation resources; and social and economic development all call for trillions of dollars of infrastructure spending in the coming decades,” Mr Fink said.
“Yet action on this front remains elusive, if not ambiguous. Governments simply cannot afford to self-fund infrastructure projects, demonstrating the need to harness the capacity of the private sector.
“Private institutional investors with low risk tolerances and long-term liability structures, such as pension funds and insurance companies, are ideally suited to put money to work in yield-oriented, multi-decade projects that provide current income and can act as a natural inflation hedge,” he said.