The Private Markets Roundtable Series Part II Debrief

Recently, SIFMA hosted the second part of its Private Market Roundtable Series, where it focused on liquidity and transparency considerations in broadening retail access to private market assets. Key take-aways from Deputy Secretary of Labor Keith Sonderling and panel participants include:

• ERISA does not need a rewrite, but an update. The Administration’s directive to expand access to alternative assets for 401(k) participants can be accomplished with clarification of long-standing fiduciary principles that take into account the liquidity and transparency differences in private vs. public market assets.
• Neutrality remains a core principle of governance. Deputy Secretary Sonderling emphasized that the Administration is neither promoting private markets over public markets nor favoring any specific product, structure or provider. Neutrality must be process-driven, rather than outcome driven. Applying a consistent, analytical framework for use by all fiduciaries will avoid policy-making through enforcement or litigation.
• Standardizing information remains a challenge, but technology will amplify data speed and comparability. Data on private assets is plentiful; the challenge is instead standardizing information and disclosures on assets that are highly bespoke. One size does not fit all, particularly given less familiarity with private market assets and structures from defined-contribution plan sponsors and participants. As the frequency of private asset valuations increases, technology should enable more timely performance reporting, improved benchmarking, and more consistent integration of asset-level data across portfolios.