South Korea’s sovereign wealth fund Korea Investment Corporation (KIC) has doubled the size of co-investments that can be decided through a fast-track process to $100 million as part of procedural changes aimed at securing better returns.

KIC’s decisions on standard alternative investments are usually made through a complicated process involving several committees. A potential investment opportunity needs confirmation from the heads of the investment and risk management divisions, as well as approval from the chief investment officer, in order to be put under review.

The investment working committee and risk management working committee then examine it, with a final decision being made by the investment committee, which consists of the chief executive officer, chief investment officer, chief risk officer, chief operating officer and heads of investment strategy and alternative investment.

But KIC allows a co-investment under a $50 million threshold to be decided through a more streamlined process that only requires approval from the chief investment officer. With the threshold being lifted to $100 million, more co-investment opportunities can bypass the time-consuming decision-making process.

The change is part of efforts by the fund to increase co-investment activity and get improved returns, industry watchers said.

KIC has co-invested in many private equity and real estate deals across North America, Asia and Europe since 2011. It is also leading efforts to co-invest with other domestic asset owners, such as pension funds and credit unions.

The fund established a $400 million joint venture with the National Agricultural Cooperative Federation in July to increase investment in foreign alternative assets. In 2014, KIC led the launch of the Co-Investment Roundtable of Sovereign and Pension Funds.

KIC had approximately $157.3 billion in assets under management at the end of 2019, with its exposure to alternative assets standing at $24.5 billion. Real estate and infrastructure accounted for the largest portion with $9.7 billion, while $9.3 billion and $5.1 billion were allocated to private equity and hedge funds respectively. (Reporting by Hee-yeon Han)