Bev Shah at City Hive writes that as policymakers and industry push for greater allocation to private markets – including UK initiatives such as the Mansion House Accord – distribution is expanding into wealth and platform channels.
Private equity, private credit and infrastructure have historically been the preserve of institutional capital. That boundary is now shifting.
At the same time, the policy backdrop is becoming more explicit. Debate around the Pension Schemes Bill – and in particular the proposed “mandation” power – has brought into focus the extent to which capital may be directed towards private markets. Recent votes in the House of Lords have again challenged this approach, resisting provisions that would allow the government to influence how pension schemes allocate capital, even in a limited form.
This matters. Because as the transition accelerates – through both market evolution and policy direction – an important question follows: are investors accessing these assets through wealth, platform and pension structures being exposed to risks that are simply less visible than those in public markets?
Fewer eyes, different scrutiny
Public markets operate within a system of continuous observation. Price discovery is real-time, disclosures are standardised, and a wide ecosystem of analysts, media, counterparties and regulators provides ongoing external challenge.
Private markets function differently.
Valuations are periodic rather than continuous. Information is shared within defined investor groups rather than broadly disseminated. Scrutiny exists, but it is more concentrated and less visible.
Policy-driven allocation adds a further dimension. Where capital flows are influenced — or even perceived to be influenced — by external objectives, the traditional mechanisms of market discipline become less clear. As private markets expand into wealth and platform channels, the level of external challenge does not scale in the same way as participation increases. The number of end investors may grow, but the number of independent “eyes on” does not necessarily follow.
The information problem
This brings the focus from scrutiny to the underlying information available to investors.
Public market investing benefits from relatively consistent reporting standards, established governance frameworks and a high degree of comparability across issuers and managers. These features make it easier not just to access information, but to interpret and challenge it.
In private markets, information is less standardised, less frequent and more dependent on manager practices and fund structures. Even where data is provided, it is often less comparable and harder to contextualise.
Within an institutional setting, this is mitigated by direct access, due diligence capabilities and negotiated transparency. As private market exposure extends into wealth and platform structures, those mitigating factors are less visible. The policy debate sharpens this point.
If capital is being encouraged – or potentially directed – into private assets, then the question is not just where it is going, but what level of visibility travels with it. Without improvements in comparability and transparency, participation can scale faster than understanding.
The issue is therefore not simply that there are fewer external eyes, but that the underlying information available to those investors is less consistent, less comparable and harder to interrogate.
This raises a more fundamental question: whether existing standards of visibility are sufficient for a broader distribution model.
Liquidity: structural, not incidental
Liquidity is often cited, but warrants more precise framing.
Private markets are structurally illiquid. Capital is committed over multi-year horizons, exits are uncertain and pricing is episodic. For institutional portfolios, this is an intentional feature aligned to long-term liabilities and return objectives.
Within wealth and platform structures, particularly in semi-liquid or evergreen formats, the interaction between underlying asset liquidity and product-level liquidity mechanisms becomes more complex. The key risk is not just the absence of daily liquidity, but the conditional nature of access to capital, particularly in stressed environments.
Where allocations are increased – whether by market choice or policy influence – this structural characteristic becomes more systemically relevant.
Governance through layers
In private markets, governance is often framed in terms of control at the asset level. But for investors accessing these strategies through wealth and platform structures, that governance is indirect. The more immediate question is the governance of the firms managing the capital.
Investors accessing private markets through wealth and platform structures are, as in public market funds, several layers removed from the underlying assets, allocating through fund structures where investment decisions, valuations and exits are controlled by the manager.
The difference in private markets is that those decisions are less visible, less frequently tested by market pricing, and harder to challenge in real time – making transparency into how they are made more critical.
In private markets, particularly among specialist firms, firm-level visibility is less consistent. How decisions are made, how risks are assessed, how internal challenge operates, how culture shapes behaviour, and how incentives influence outcomes are often not clearly observable from the outside.
This matters more in private markets precisely because of their illiquidity. When capital is committed for extended periods, investors are less able to respond to poor decisions or changing conditions. The ability to exit is constrained, which increases reliance on the judgement, discipline and culture of the firm managing that capital.
The result is that investors are required to place significant reliance not just on the assets, but on the firm itself – how it behaves, how it makes decisions, and how it exercises stewardship over time – with limited ability to interrogate those factors in practice.
In this context, governance is not simply about control at the asset level. It is about the visibility of the firm itself – and how far that can be understood from the outside.
Raising the bar
There are already signs of how this may evolve.
As private markets are increasingly distributed through wealth and platform channels, expectations will need to evolve alongside access, reflecting the standards developed in public markets – around comparability, disclosure and ongoing scrutiny.
This does not mean replicating public market frameworks wholesale. But it does mean moving towards greater consistency in reporting and improved visibility into how decisions are made and how firms operate.
The current policy debate is, in part, accelerating that shift. If governments are prepared to play a more active role in shaping capital allocation – even as a backstop – then the case for stronger standards of transparency, comparability and governance becomes more acute.
Part of this shift may come from the changing composition of the market itself. Traditional asset managers – many of whom have long operated under higher expectations of transparency – are expanding into private markets, whether through acquisition or organic growth. Large insurance asset managers have also operated across both public and private markets for some time.
As these models converge, there is an opportunity for standards to converge with them. Expectations around disclosure, governance and visibility developed in public markets can begin to carry across into private market strategies.
Tokenisation and digital distribution models may improve access and operational efficiency. But greater accessibility, in the absence of improved visibility, risks widening the gap between participation and understanding.
If private markets are to play a larger role in portfolios accessed through wealth and platform structures, then the standards that underpin them will need to rise accordingly.
The bottom line
The expansion of private markets into wealth, platform and pension structures is a significant structural shift – and one now reinforced by policy direction as well as market forces. But access, in itself, is not sufficient.
If private markets are to become a core allocation beyond institutional portfolios, then the standards that support them must evolve accordingly.
Because as capital moves from public to private markets, the risk is not just that returns behave differently – but that the underlying risks become harder to see, particularly where the ability to exit is limited.
