By Shruti Menon Seeboo
As the 9th Pension Funds and Alternative Investments Africa (PIAfrica) Conference convenes at the Hilton Mauritius this February, the dialogue centres on the sophisticated deployment of institutional capital. At the heart of this transition is the Government Employees Pension Fund (GEPF) of South Africa, a titan whose strategic shifts signal broader trends across the continent.
In this exclusive interview, Brian Karidza, GEPF’s Head of Actuarial and Benefits Administration, explores the rigorous mechanics behind the fund’s evolution. From the actuarial complexities of private market acceleration and the intricacies of cross-border regulatory navigation to the integration of climate-forward financial risks, Karidza outlines a blueprint for fiduciary excellence. His perspective reinforces a critical 2026 mandate: while pension funds possess the scale to drive social infrastructure and affordable housing, such “developmental investing” must remain anchored in ironclad risk-adjusted returns and long-term liability matching. Excerpts:
- As one of the largest funds driving Africa’s Institutional Investor Power, how does GEPF adapt its actuarial models to account for the unique risks and illiquidity associated with increasing allocations to Private Markets Acceleration?
Our actuarial and ALM work is naturally long-term, so the first adjustment for private markets is less about changing the “engine” and more about strengthening what we feed into it. Practically, we treat private markets as a different risk/return and cashflow profile: valuations are less frequent and can lag public markets, and cashflows are driven by capital calls and distributions (often with an early “J-curve”).
So we build in pacing and diversification and stress tests that combine market drawdowns with slower distributions and higher calls. We lean heavily on manager research and independent advice to keep assumptions realistic, then monitor whether actual cashflows and realised outcomes are tracking the model. Over time, the model gets refined based on experience rather than theory alone.
2. The PI Africa agenda highlights Navigating New Regulation across key markets. How does GEPF manage compliance and risk when making cross-border investments within Africa, especially regarding currency and regulatory divergence?
For cross-border investing, we start with a simple principle. We only want to take risks we understand and can govern. That means we do deep pre-investment work on local regulation, licensing, tax, repatriation rules, custody arrangements, and enforceability of contracts usually with on-the-ground partners and specialist legal input.
Currency risk is managed as a portfolio issue, not a one-off decision. We set exposure limits, run scenario tests for devaluation and convertibility constraints, and hedge where it’s practical and cost-effective. From a South African control perspective, we also ensure transactions are structured to comply with exchange control and prudential requirements as implemented through authorised dealers and the prevailing SARB framework.
The other big tool is engagement: where rules are evolving or unclear, we try to engage early and collaboratively with regulators and credible market participants rather than “guessing” and hoping for the best.
3. How is GEPF evolving its approach to Asset Allocation to incorporate non-financial factors, particularly those related to Climate-Forward Investing, while strictly adhering to its long-term liability matching obligations?
Climate risk increasingly shows up as financial risk. So the evolution is that we’re embedding climate considerations into strategic asset allocation and risk management, while keeping the liability objective front and centre.
In practice, we incorporate climate-related scenarios into our long-term modelling, we expect managers to demonstrate how ESG and climate risks are priced and managed, and we use stewardship (engagement and voting) to push for better disclosure and governance in the assets we own. That sits alongside our responsible investment approach and investment beliefs, which explicitly recognise ESG factors as relevant to long-term outcomes.
Where climate-forward opportunities are also bankable (e.g. renewable energy, resilient infrastructure, green buildings), we can pursue them through the same lens: risk-adjusted returns first, and sustainability benefits as part of long-term value protection.
4. From an Actuarial perspective, what is the greatest benefit and the greatest challenge the GEPF sees in the trend toward Strengthening Trustee Capacity and enhancing their understanding of complex alternative investment structures?
The biggest benefit is better decisions will be made. When trustees understand the structure and risk drivers of alternatives they can better challenge and interrogate advisors and managers more effectively. That improves outcomes and reduces the risk of blind investing.
The biggest challenge is that alternative structures are genuinely complex and the information asymmetry is real. Even capable trustees can be pulled into either learning inertia or herd mentality . There’s also a time constraint. Trustees have many responsibilities, and deep technical mastery takes effort.
I believe that the way through is a practical middle ground. Targeted training, independent specialist support and a culture of continuous learning is required.
5. What role do you believe African pension funds, given their scale, should play in financing essential public services and Affordable Housing that directly contribute to the social well-being of their members?
Given their scale and long horizon, pension funds should be part of financing solutions that strengthen the economies their members retire into. However this has to be done with discipline. Our first responsibility remains paying promised benefits, so investments must still meet appropriate risk/return requirements and be backed by credible governance and implementation capacity.
In affordable housing specifically, funds can play a meaningful role through well-structured vehicles, where revenue models are clear and there is alignment across stakeholders. Pension funds can allocate and partner, but they can’t carry the full burden of social delivery alone.
This is broadly consistent with the idea of developmental investing. Pension funds can play a role in supporting growth and sustainability objectives where those investments are investable and aligned with long-term performance.
