Bringing pension investments to life through clearer, more tangible narratives could play a key role in improving defined contribution (DC) member engagement, according to Aviva Investors UK head of institutional, James Edwards.

He argued that while engagement remained a persistent challenge in DC pensions, helping members understand where their money was invested - and the real-world impact of those investments - could help bridge the gap.

“I think if you can show members that they’re invested in tangible, impactful projects, they are more likely to care,” he explained.

“There is still disengagement because pensions are long-term, but bringing investments to life can make a difference.”

Edwards added that using real investment examples, particularly in private markets and UK productive finance, can make pensions more relatable to savers while still meeting the core requirement of delivering strong financial outcomes.

“There are good things you can invest in in the UK that stand up from a fiduciary perspective versus anything globally," he said.

“If the returns are there, schemes will invest - there’s no inherent bias against the UK.”

Edwards pointed to several projects to illustrate how this could work in practice, including Aviva Investors’ single-family housing platform and a development linked to the London Cancer Hub.

“These are long-term projects that generate returns while also delivering wider societal benefits,” he noted.

“When you’re talking about real assets, it becomes much easier for people to understand what productive finance actually means in practice.”

He also highlighted a natural capital project in Aberdeenshire focused on peatland restoration and afforestation, which is designed to capture more than 1.4 million tonnes of carbon over its lifecycle.

The ability to clearly communicate these types of investments is becoming increasingly important as pension schemes expand their exposure to private markets, particularly within DC arrangements.

Indeed, Aviva Investors’ latest Private Markets Study found that 72 per cent of DC funds globally believe adding private markets to accumulation portfolios will improve performance outcomes, reflecting a shift away from viewing private assets solely as a defined benefit (DB) strategy.

Edwards stressed that this growing interest in private markets was now a central theme across DC, Local Government Pension Scheme (LGPS), and DB segments, alongside increasing focus on UK-based investment opportunities.

“Across DC, LGPS and DB, we’re seeing growing interest in how these assets can be used effectively," he said.

Meanwhile, in the LGPS, he noted that attention was increasingly turning towards local investment strategies, particularly in areas such as housing, infrastructure and regeneration, although approaches are still evolving.

“There’s a lot of focus on what local investment could look like, but it’s not fully defined yet,” he said.

“Residential property is a key area, partly because it’s well understood, offers inflation alignment, and meets a clear societal need.”

This shift also reflects a broader evolution in how environmental, social and governance (ESG) considerations are being framed within investment strategies.

“The framing has changed,” Edwards said. “It’s now about identifying compelling investments - like infrastructure or regeneration projects - that also happen to deliver positive environmental or social outcomes.”

On the DB side, Edwards suggested that attention was also turning to how schemes manage growing surpluses, with many considering run-on strategies alongside traditional risk-transfer routes.

“It’s not going to be a one-size-fits-all approach," he said. "For many schemes, it will be about taking incremental steps - perhaps running on for five to seven years and assessing from there.”

“You’re not going to see a wholesale shift in asset allocation. It’s more about how that surplus can be used - while maintaining a prudent approach.”

Despite ongoing debate around government intervention, Edwards suggested that the primary issue was not a lack of willingness from schemes to invest in the UK, but ensuring there was a sufficient pipeline of suitable opportunities.

“I’m sure schemes would welcome more opportunities to invest in the UK,” he added.

“If the right assets are there, they will allocate to them.”

---