The Irish Association of Pension Funds' (IAPF) Investment Committee has published a paper calling for coordinated action from across the pensions ecosystem to increase allocations to domestic investments.

It stated that while the Irish pension system had established substantial and growing pools of long-term capital, allocation to domestic opportunities remained limited.

The association argued that addressing this domestic investment shortfall was not driven by sentiment or obligation, but by a “compelling opportunity” supported by strong investment fundamentals, market development potential, and advancing long-term national resilience.

To meet the goal of greater domestic investment, the IAPF called for coordinated and consolidated action from regulators, trustees, investment advisers, asset managers and allocators, and government agencies and policymakers.

With Ireland assuming the EU Presidency from 1 July, the committee said there was a unique platform for the Irish pensions sector to demonstrate leadership in capital markets development and long-term investment frameworks.

Its paper outlined three ‘key actions’ to facilitate change, including the development of a suitable fund vehicle across the three pension pillars.

The IAPF said such an investment vehicle should provide enhanced liquidity frameworks that align to the pillars’ time horizons; meet institutional standards for governance, transparency, and scalability; enable efficient access to a diversified range of domestic opportunities; and allow participation from additional investor groups.

“Crucially, the vehicle must be sufficiently transparent and understandable to support trustee decision-making and member confidence,” it stated.

“Without a suitable vehicle structure, allocation will remain constrained regardless of intent.”

The second key action was continued dialogue across stakeholders to meet the need for symmetric information and for stakeholders to work together in completing the value chain.

“Without a collective working group driving this agenda forward, the fragmented discussions and different understandings will result in the status quo being retained,” the paper said.

Finally, the committee said the industry would need to shift its emphasis from headline costs to value delivered to underlying investors, as a continued focus on cost would risk excluding assets that could enhance absolute performance, diversification, income, and resilience.

This would mean prioritising net performance outcomes, aligning fee structures with long-term value creation, and ensuring cost transparency while recognising the need for appropriately resourced investment strategies.

“Without this shift, the necessary vehicles and strategies will struggle to gain traction,” the committee stated. “Investors must see clear, risk-adjusted value.

“Ireland has both the capital and the capability to strengthen its domestic investment ecosystem.

“The challenge is not one of resources, but of coordination, structure, and execution.

“By acting collectively, aligning incentives, and focusing on practical solutions, Ireland can create a model that balances global diversification with meaningful domestic participation.

“The path forward is clear. The question now is whether we move decisively.”

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