U.S. pension funds have billions of dollars in assets and a very long-term investment horizon, making them a unique kind of investor. But, while pension funds could play a powerful role in shaping financial markets, they currently act more like customers than dealmakers, partially because of their reliance on private money managers to invest those assets for them for large fees. If that reliance were reduced and other legal, political, and cultural obstacles overcome, ⎯ many experts said that the funds could improve their investment strategies at the same time they open the door to socially responsible investing, mission investing, and shareholder activism.
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