Northern Trust will provide services for Nest’s investment strategy, including custody, asset allocation and rebalancing and performance measurement.

The firms said the new partnership will oversee substantial growth in Nest (the National Employment Savings Trust), with the scheme forecast to pass £100bn in AUM in 2030.

Mark Fawcett, chief executive of Nest Invest, said: “Nest is at an exciting point in our journey. Within the coming years, we’ll likely be the largest UK pension scheme by both AUM size and membership. We’ve needed to consider how we manage that growth to ensure we continue delivering a world-class service for our 13 million members.”

He said the fund administrator is one of Nest’s most important contracts. “It provides the platform to manage our growth across our highly diversified portfolio, including enhancing the member journey across our range of funds as we implement our private markets programme.”

He said Nest has specific requirements for asset allocation and rebalancing, and said the flexibility Northern Trust can offer, to evolve the services we need around our future growth, will be crucial.”

Ian Hamilton, head of asset owners, UK at Northern Trust said: “This mandate is testament to Northern Trust’s track record in supporting complex asset owners deliver transformative change.” 

The current fund administrator contract expires in October 2025.

Nest currently invests £39bn on behalf of its 13 million members, making it one of the UK’s largest pension schemes. 

Northern Trust Corporation provides wealth management, asset servicing, asset management and banking to corporations, institutions, affluent families and individuals. It was founded in Chicago in 1889 and now has a global presence with offices in 24 US states and across 22 locations in Canada, Europe, the Middle East and the Asia-Pacific region. As of 31 March, Northern Trust had assets under custody/administration of US$16.5trn (£13.17trn), and assets under management of US$1.5trn (£1.2trn).