Month: September 2020

Mandate roundup: SEI, Torfaen, FIL Pensions Management, Invesco AM

first_imgAs CIPD’s adviser, SEI is to provide strategic investment advice and the full implementation of a bespoke investment strategy.SEI will also manage the scheme’s day-to-day investment strategy, including the selection and replacement of managers, tactical asset allocation, changes to strategy, funding-level monitoring and reporting.Peter Purdom, chairman of trustees at the CIPD scheme, said: “We were initially looking to appoint a traditional consultant. However, during the selection process, it became apparent SEI’s solution offered a greater diversification of asset classes, investment styles and investment managers than would be possible using the more traditional approach.”In other news, Torfaen County Borough Council has awarded FIL Pensions Management a £50m global emerging markets mandate.At the same time, it awarded a £100m Asia Pacific ex Japan mandate to Invesco Asset Management. The £29m (€35m) CIPD defined benefit pension scheme has appointed SEI as its investment adviser.SEI will act as an adviser for the whole of the UK scheme’s assets.CIPD is the professional body for HR and people development.Its trustees selected SEI after a competitive process involving a number of providers, they said.last_img read more

USS to join UK institutional investors in legal action against RBS

first_imgFive UK institutional investors, including the Universities Superannuation Scheme (USS), are set to launch a legal challenge against the Royal Bank of Scotland (RBS) over a 2008 share issue, IPE understands.Joining USS are Legal & General Investment Management (LGIM) and insurers Standard Life and Prudential.The fifth claimant, as first reported by news agency Reuters, is believed to be Aviva Investors.The case relates to a £12bn (€14.6bn) share issue from RBS at the end of April 2008, the largest in UK corporate history, which the bank undertook to shore up its finances after the controversial takeover of Dutch bank ABN AMRO. The investors argue the bank misled them into increasing their shareholdings and are seeking compensation from the losses resulting from the fall in share price since.Around six months after the group bought further shares in RBS, the bank was bailed out by the UK government, which now retains an 81% stake.Referred to as the ‘Quinn Emmanuel group’ after the representing law firm, the institutions are expected to file the case with the UK High Court on Wednesday, the sixth anniversary of the share issue.All five institutions declined to comment on the case.The lawsuit is expected to be the tune of £1bn in compensation from the bank. However, IPE understands the exact split among the five claimants is yet to be decided.RBS’s trading share price at the time of the issue was £34.6, before plummeting to £4.94 by the end of the year, after the government bailout.The case follows on from a group of more than 100 institutional investors making a similar case in April 2013.The RBS Shareholder Action Group filed a case with the High Court against the bank and four former directors, seeking damages for “inexcusable actions”.A statement from the bank regarding the imminent lawsuit said that, while it made decisions that have been criticised, it never acted illegally.“This does not mean the company or directors misled investors or acted illegally,” the statement said.“We believe we have strong defences to the claims that are being brought against the bank, and that is why we intend to defend these vigorously and to protect the interests of our shareholders, including UK taxpayers.”last_img read more

IPE Top 400: Danish asset managers climb in 2014 global ranking

first_imgJesper Langmack, managing director at PFA Asset Management (PFA Kapitalforvaltning), told IPE: “The main driver of our increasing AUM, PFA Pension, successfully launched a new defined contribution platform in 2009 attracting several new corporate clients.”PFA Asset Management – the investment management arm of the PFA group – had experienced significant growth in assets under management in recent years, he said.“The success of PFA Pension is expected to continue driving AUM growth this year and in the coming years as well,” Langmack said.“Similarly, we expect both our institutional and retail fund range to continue contributing to asset growth going forward.”At the beginning of 2013, PFA also took over Danish clerical workers’ pension fund FunktionærPension.Niels-Ulrik Mousten, head of Danske Capital, attributed the business growth seen at the Danske Bank asset management division last year to the strength of markets outside Denmark.“In the first quarter of 2014 alone, 71% of net sales are from countries outside Denmark,” he said.He said this development underlined the fact Danske Capital had become an overall export business.Right now, the division is managing assets for Danish and foreign investors on the private as well as the professional sides of around DKK748bn, which means assets have crossed the €100bn line for the the first time.Mousten described it as “realistic” to think Danske Capital’s level of growth seen so far could continue.Nordea Investment Management also attributed its growth during 2013 in large part to business expansion outside Denmark. Allan Polack, chief executive of Nordea Investment Management, said: “Global equities, euro credit products and total return products – these are the three growth areas for us that lie behind the global sales.”Business from Southern Europe was very strong, he said, with this development most likely reflecting a shift by investors from local asset managers to more international asset managers. “Looking ahead, we’re pretty optimistic, particularly regarding international growth, basically because our product offering suits what’s going on,” Polack said.He said there was a lot of interest from clients in absolute risk management, as they aimed to take on more risk but in a controlled way. Maj invest5,7115,168 BankInvest8,3918,416 Jyske Bank Capital Management11,300- Carnegie Asset Management11,0009,300 PFA Pension55,89543,135 Nordea Investment Management151,418140,644 Company2014 Total2013 Totalcenter_img Danske Capital96,59790,045 31/12/13 (€m)31/12/12 (€m) Nordea Investment Management has once more topped the ranking of asset managers within Denmark, according to IPE’s Top 400 Asset Managers survey for 2014, with Danske Capital in second place and PFA Pension narrowing the gap as the country’s number three.Seen internationally, Nordea Investment Management rose to number 71 in the 2014 league table of the Top 400 Asset Managers from number 74 in 2013, while Danske Capital rose to number 94 from 102, and PFA Pension leapt to 143 from 165.Assets under management (AUM) at Nordea Investment Management rose to around €151bn at the end of 2013 from €141bn a year before, according to the data complied by IPE based on information provided by the individual companies and from public sources. Meanwhile, Danske Capital came second once more, with assets having risen to €97bn from €90bn, followed by PFA Pension, which saw assets rise particularly rapidly during 2013 to €56bn from €43bn.  Gudme Raaschou Asset Management7,263- Nykredit Asset Management15,62914,004 Jyske Invest Fund Management8,073-last_img read more

Croatia cancels highways monetisation scheme in favour of IPO

first_imgCroatia’s plan to monetise the €4.2bn debts of Hrvatske Autoceste (HAC), the national motorway authority, and Autocesta Rijeka-Zagreb (ARZ), the state-owned company that operates the Rijeka-Zagreb motorway, have come to an abrupt end.On 13 March, prime minister Zoran Milanović announced that the government was cancelling the tender and replacing it with an IPO of 51% of Croatian Motorways Maintenance and Tolling (HAC-ONC), the agency jointly owned by HAC and ARZ.This alternative was first made public earlier in March by Siniša Hajdaš Dončić, minister of Maritime Affairs, Transport and Infrastructure.Croatia’s four mandatory pension funds, part of the original bidding consortia, would still be involved. According to Croatian media, 80% of the available shares would be offered to the pension funds, and the remainder to the Croatian citizens and HAC ONC employees.The prime minister said the IPO would relieve the state budget of principal and interest repayments, which would become the responsibility of the IPO investors.Politically, the government’s decision allows it to sidestep a potentially embarrassing referendum against the monetisation programme that was awaiting clearance by the Constitutional Court.Had it gone ahead, the referendum would have barred not just the HAC-ARZ concession but all similar future schemes.Opinion polls suggested the concession was proving highly unpopular, and not just because of its perception as a privatisation of public property.Ultimately, it would have been funded largely by higher motorway tolls and fuel excise duties.There will nevertheless be financial repercussions associated with the last-minute cancellation, including potential lawsuits by the bidders to recover the costs incurred to-date.The three consortia submitted non-binding bids in 2014 and were set to follow up with binding bids this April.Meanwhile, the Croatian Democratic Union (HDZ), the largest opposition party in Parliament, has called for Dončić’s resignation, reminding him that he had earlier ruled out any alternatives to the monetisation concession, and had himself threatened to resign if it fell through.last_img read more

Denmark must tackle pension tax, says head of abolished commission

first_img“This may have detrimental effects on savings and retirement incentives, and it is therefore important to address this issue.”He also cited differential taxation of different types of savings, as well as the complicated rules surrounding pension saving.“The only issue the government wants to pursue is the so-called residual group, that is, those who do not – or only to a very small degree – save for pensions,” he said.He pointed out that the whole idea of the commission when it was set up was to take a thorough look at the entire pension system. “This is important since the system is maturing, and since there have been a number of policy changes in other areas, or with other purposes, which have affected pension savings,” he said. Andersen said the commission’s main task was to come up with possible solutions to problems in the Danish pension system.Now that the body was being abolished, this would not happen, he argued.However, he said that not all the work the commission had so far done had been wasted.“The commission has produced a first small report highlighting the pros and cons of the Danish pension system, and has prepared a number of analyses on how the system will develop as it matures, with more and more people set to retire with a decent labour market pension,” he said. The high effective rate of tax on pension savings in Denmark, arising because public pensions are means-tested, is one of the pension system’s biggest problems and must be addressed, according to the head of the Danish Pensions Commission.The new Danish centre-right government, which took office in June following the general election, said a week ago that the Pensions Commission, set up under the Social-Democrat-led government in 2014, would now be disbanded.Explaining the move, the incoming minister for taxation Karsten Lauritzen said the commission had been set up by the previous government, and that the new government now had different objectives and time-scales.Torben Andersen, chairman of the commission and professor in the department of economics and business at Aarhus University, told IPE: “One of the big issues in the Danish system is the high effective tax rates of pension savings, for low and medium-income households, due to the means-testing of public pensions.last_img read more

Draft ECON report reveals softer line on international reporting standards

first_imgThe report, which also urges the EC to look at whether the European Securities and Markets Authority (ESMA) has adequate powers, potentially puts long-term UK investor concerns about IFRS in conflict with Europe’s politicians.Sarah Wilson, chief executive at corporate governance advisers Manifest Proxy, said: “While we welcome more transparency and accountability in respect of IFRS, we would be extremely concerned by any proposals that sought to increase a market regulator’s oversight of company law matter.”Of concern to corporate governance activists is the observation in the report that ECON “[w]elcomes the fact that the Commission is encouraging member states to follow the ESMA enforcement guidelines on IFRS.”Stolojan, a former prime minister of Romania, goes on to urge the Commission to weigh up whether ESMA’s powers allow it to ensure consistent and coherent enforcement across the EU.Wilson warned it was important to maintain a strict boundary between shareholder interests and market regulation.“Companies exist even when financial markets do not,” she said. “Markets are trading facilities, not owning facilities.“In many parts of the EU, just like the UK, there is a proper separation between the interests of companies and their providers of capital, the shareholders and the markets.”In a statement, the Financial Reporting Council told IPE: “We support and benefit from ESMA’s current co-ordinating activities on enforcement.“ESMA’s Standards of Enforcement ensure an appropriate level of consistency and comparability at EU level while leaving each national enforcer as the best placed to determine its approach, which suits the characteristics of its own market and behaviours of relevant market participants.”ESMA’s founding regulation allows it to introduce guidelines for national competent authorities and issuers.Under Article 16 of the regulation, member states must either comply or explain within two months.ESMA then reports to the European Parliament on which states do not comply and what action it intends to take to ensure they do so in future.The Stolojan report also asserts that allowing individual member states to decide whether or not to use IFRS for local reporting purposes such as separate financial statements “ensures proper subsidiarity and proportionality”.Meanwhile, some investors in the UK, such as the Local Authority Pension Fund Forum (LAPFF), have been highly critical of IFRS in recent years.The LAPFF has also complained that IFRS lack any reference to the principle of prudence in its conceptual framework.The IASB has said it will reintroduce the concept of prudence to its conceptual framework.The LAPFF has recently written to FTSE 350 chairmen and invited them to ignore guidance from the UK’s audit watchdog, the Financial Reporting Council, on the question of distributable reserves.Ahead of that move, the LAPFF sought two opinions from leading commercial barrister George Bompas QC.He concluded that accounts prepared under IFRS could potentially damage shareholder interests.Listed companies in the EU have used IFRS as the basis for their financial reporting since 2005.The standards are developed by the London-based international Accounting Standards Board.Also contained in the 12 January draft ECON report is a reference to the European Commission’s plans to “examine the case for strengthening the EU rules relating to dividend distribution”.The EC committed to look at the issue in a report last year.The Commission noted that capital maintenance and dividend distribution rules have been a source of potential legal conflict in some jurisdictions.Currently, each member state decides how to address these questions within the framework of its own national law and EU capital maintenance requirements.The Commission concluded: “The Commission will examine the case for strengthening EU rules relating to dividend distribution.”But away from shareholder concerns, ECON could be about to play hardball with the US over its failure to adopt IFRS for use by US companies.Although the US has since 2008 allowed foreign entities to file IFRS financial statements, it has backed away from allowing domestic businesses to do the same.Despite this, the US has nonetheless maintained a seat on the monitoring board that overseas the activities of the IASB’s parent body, the IFRS Foundation.According to the draft ECON report, the Parliament supports the Commission in the view that applying IFRS and permanent financial contribution to the IFRS Foundation “are conditions for membership of the governing and monitoring bodies of the IFRS Foundation and of the IASB”.Last year, Jim Schnurr, the chief accountant of the Securities and Exchange Commission, revealed publicly that here is “virtually no support to have the SEC mandate IFRS for all registrants”.Moreover, he went on that “there is little support for the SEC to provide an option allowing [US listed] companies to prepare their financial statements under IFRS”.But he added that one route to securing the objective of a single global set of accounting standards could be to give US-listed companies the option of providing supplementary IFRS-based information. The ECON report remains open to amendment by individual members of the European Parliament. A draft report from the European Parliament’s Committee on Economic and Monetary Affairs (ECON) suggests the Parliament has softened the tone of its rhetoric against International Financial Reporting Standards (IFRS).Under its previous chairwoman, Sharon Bowles, the committee marked itself out as highly critical of the International Financial Reporting Standards Foundation, the parent body of the International Accounting Standards Board.The report, drawn up by ECON’s rapporteur, Theodor Stolojan, notes that IFRS “strengthen accountability by reducing the information gap between investors and companies”.The 10-page document also asserts that IFRS protect investor interests, deliver transparency and facilitate effective decision-making in Europe’s capital markets.last_img read more

Securities lending lessons for responsible investors

first_imgThe gains to be had from securities lending “do not come completely free”, however, said van der Struik.For example, investors lose their voting rights for the period they lend out the stock. This means that a responsible investor needs to have a policy in place on securities lending and voting to ensure they are complying with their fiduciary duty, the manager said.He explained that PGGM has “quite a strict policy” on this. It has a list of 100 companies that it does not lend out, and which it always votes on. PGGM voted on 95% of its equity positions last year, he said.Another issue flagged by van der Struik is “empty voting”, when a party that does not have an economic interest in a company borrows shares just for the votes at an annual meeting.He said that this was extremely rare, but that the impact was nonetheless quite serious. To mitigate this, investors could write in the contract with the borrower that this practice is not allowed.“In all our contracts it is disallowed, it is seen in the market as extremely bad practice, and in most jurisdictions it’s illegal,” van der Struik added.He later told IPE that pension funds get “very mixed signals” about securities lending, he said, with some investment consultants very much in favour and others saying it is incompatible with ESG.He also explained that the extent to which lending out securities – which could be used for short-selling – makes sense for investors could also depend on whether the securities are held as part of index-tracker funds or a high-conviction segregated mandate.As concerns short-selling, van der Struik said that “sometimes it’s seen as evil” but that the consensus is that it helps create an efficient market.He said that most of the bad press that securities lending gets is unjustified, but that headline risk is “one risk that in no way you can mitigate”.“It’s not a free lunch, but it’s a pretty good investment,” he said. Securities lending is not usually associated with responsible investment, but given the right approach it can bring in incremental income without sacrificing principles.That was the argument of Roelof van der Struik, a portfolio manager at major Dutch pensions investor PGGM, speaking at a conference of the World Pensions Council in London last week. PGGM’s main client, healthcare pension fund PFZW, has a strong responsible investment policy and wouldn’t tolerate the practice if it wasn’t done properly, he added.Lending stocks to other investors for short periods is more nuanced than bad press about the activity has portrayed, he argued, and can be reconciled with being a responsible investor. The practice can generate income and create or transform liquidity.Van der Struik joked that he was known as the “chief crumbs officer” at PGGM after a colleague remarked during a meeting recently that “we should not forget to pick up the crumbs”. Van der Struik said he had “consistently” made 1% on collateralised trades for PGGM.last_img read more

British Steel: Trustee board defends member communications

first_imgThe trustees of the UK’s British Steel Pension Scheme (BSPS) have hit back at accusations that the communication of their ambitious restructuring project to members was “woefully inadequate”.In a report published by the Work and Pensions Select Committee this morning, politicians from the UK’s lower house of parliament said the £14bn (€15.8bn) scheme was “under-resourced and unable to provide basic facts to inform a complex choice”.The report relates to a major restructuring of the scheme to prevent its sponsor, Tata Steel UK, from being driven to insolvency. The restructure is awaiting regulatory approval.Members were given the option of transferring to a new scheme, sponsored by Tata Steel UK but with lower indexation, or going into the Pension Protection Fund, which cuts benefits by 10% for those not yet retired. Alan Johnston, chair of the British Steel Pension Scheme, gives evidence to Work and Pensions Select CommitteeIn a statement, the trustee board said the committee’s claims were “not supported by the evidence”.“The [board] set out to achieve maximum engagement and received responses from over 97,000 of its 122,000 members,” the statement said. “A response rate of nearly 80% is highly commendable for an exercise of this type.” The trustees said they had been preparing for the Time to Choose project since late 2016, engaging independent experts and updating and digitising records.They highlighted the 41 events held across the country to explain the changes to members, and defended the information provided to participants.“All members were provided with enough information to make good choices,” the trustees said.The committee called for TPR to review the scheme’s communication exercise and for improvements to data and record keeping across the pension sector. The committee claimed the communication of the restructuring to members – a project dubbed “Time to Choose” – was “woefully inadequate”.The report said the Pensions Regulator (TPR) had been alerted to “gaps in basic data” in the communications to members.last_img read more

People moves: Blankfein to exit Goldmans; DWS expands insti team

first_imgSource: Goldman SachsLloyd Blankfein addresses Goldman Sachs shareholders on TuesdayAdebayo Ogunlesi, lead director of the company’s board, added: “Lloyd has been a remarkable leader during an extraordinary period of challenge for Goldman Sachs.“His temperament and innovative thinking, deep understanding of risk and the firm’s businesses, and ability to motivate and inspire the people of Goldman Sachs have defined his tenure.“He has pushed the firm’s entry into new businesses and opportunities, while also investing in areas that will continue to be highly valued by our clients.” DWS – The asset management arm of Deutsche Bank has hired a trio of senior staff to its institutional client-facing team. Gareth Davies joins from Hermes Investment Management as head of UK institutional clients, having previously held senior roles at BlackRock, Henderson, JP Morgan and Bacon & Woodrow.Alexia Giugni has been named head of institutional clients for southern Europe. She has spent much of her career in the investment banking sector with a focus on insurance.Shalin Bhagwan joins as head of UK pensions advisory. He was previously head of fixed income at Ashburton Investments, responsible for its liability-driven investment business. He has spent much of his career specialising in LDI, having led the LDI business at AXA Investment Managers. He has also worked in LDI related roles at Legal & General Investment Management, Mercer, and Hewitt Associates.Investec Asset Management – Anna Genda will join the investment company’s UK institutional business at the start of August in a newly created role as director of direct defined benefit, defined contribution and insurance. She was previously an investment director at Fidelity International, and has worked in several other investment consulting roles.Genda’s appointment follows a number of recent additions to Investec’s institutional business, including Ed Evers as head of global consultants; Alastair Leather as sales director for global and UK consultants; and Michelle Campbell as a sales associate for global and UK consultants.PAAMCO Prisma – Jane Buchan and Girish Reddy, co-chief executives of the US-based hedge fund provider, are to leave the company later this year as part of a leadership restructure. The pair will remain at the company in an advisory capacity until the end of this year.The company – formed last year by the merger of PAAMCO and Prisma – will be led from 1 August by a six-strong executive committee, chaired by Eric Wolfe, currently head of the portfolio management team at Prisma. Buchan was a co-founder of PAAMCO in 2000, while Reddy co-founded Prisma in 2004. Buchan plans to launch a quantitative investment fund next year, while Reddy plans to move into “investing and educational philanthropy”, the company said. IFRS Foundation – The international accounting standards body has named the governor of Finland’s central bank as chair of its trustee board. Erkki Liikanen was a member of parliament in Finland for 18 years, including three as finance minister from 1987 to 1990, and subsequently became Finland’s first EU commissioner in 1994. In 2012, he chaired an EU inquiry into structural reforms for the banking sector. He has led Finland’s central bank since 2004.The IFRS Foundation said in a statement that Liikanen would lead the trustee board in “advancing their objectives of developing a single set of high-quality, understandable, enforceable, and globally accepted accounting standards and promoting and facilitating the adoption of IFRS globally”.Financial Reporting Council (FRC) – Elizabeth Barrett is the UK accounting regulator’s new executive counsel and director of enforcement, effective from 1 August. She will be responsible for leading the FRC’s enforcement division and for decisions in relation to disciplinary proceedings involving auditors, accountants and actuaries, the FRC said.She joins following a 30-year career at law firm Slaughter & May, including 27 years as a partner. She advised the UK treasury department on a number of high-profile proceedings throughout the financial crisis and after, including its interventions in Northern Rock and Bradford & Bingley.Vanguard – The passive investing giant has appointed Gregoire Blanc as senior ETF capital markets specialist, responsible for “supporting the liquidity of Vanguard’s products, and helping clients achieve their desired investment outcomes”, according to the company. He joins from Lyxor Asset Management where he held a similar role.The hire is part of a marked push to expand its ETF staff in Europe. Simone Rosti joined last month as head of Italy, Markus Weis was named deputy head of Germany and Austria in February, and Liz Wright, Rahul Thrakar and Christophe Collet have also joined the firm this year as senior ETF specialists.Systematic Investment Management – Christian Gast has been named CEO of the Swiss asset manager with effect from November 2018. He joins from BlackRock where he was head of iShares and index investing for Switzerland, a position he held since 2010. He previously led UBS’ exchange-traded fund business since 1999.The company was set up last year as a joint venture between fund managers from Credit Suisse and a team from Switzerland’s Federal Institute of Technology in Zurich. Achmea IM – Ivo van der Veen has been appointed business development director at the €120bn Achmea Investment Management. Van der Veen joins from Deloitte, where he was an adviser to pension funds and asset managers for the past five years. Prior to this, the econometrist worked at Aegon Asset Management for 10 years. At Achmea IM, Van der Veen is to focus on growing its fiduciary management, liability-driven investing and responsible investment businesses.VanEck – The ETF provider has further expanded its European staff with the appointment of Gijs Koning as head of portfolio management and operations. He is co-founder of the Dutch ETF provider Think ETFs , which was acquired by VanEck earlier this year. Think ETFs’ other co-founder, Martijn Rozemuller, is the new head of VanEck Europe.BlueBay Asset Management – The fixed income specialist has appointed Gautam Kalani to the newly created role of emerging market FX strategist. He will be responsible for analysing and shaping global FX positioning across BlueBay’s emerging markets investment strategies, the company said. Kalani was previously a strategist in the emerging markets research team at Deutsche Bank. Barnett Waddingham – The UK consulting and actuarial firm has appointed Nasir Shah to its insurance consulting team. He joins as consulting actuary and associate, and will support general insurance companies across a variety of areas. He was previously at ANN Consulting, which he co-founded in 2014.Kas Bank – Rebecca Pitts has been appointed as business development manager at Kas Bank, specialist provider of securities serices to the UK pension industry. She has been tasked with developing and delivering innovative fintech solutions for trustees in both private and public sectors. She joins from SEI Investments Europe where she was a technical sales executive. Goldman Sachs, DWS, Investec, PAAMCO Prisma, IFRS Foundation, FRC, Vanguard, SIMAG, Achmea, VanEck, BlueBay, Barnett Waddingham, Kas BankGoldman Sachs – Lloyd Blankfein , chairman and chief executive officer at the investment banking giant, is to leave the company at the end of September after 12 years at the helm. David Solomon , currently president and co-chief operating officer, will take on both roles from 1 October.Blankfein joined Goldman Sachs in 1981 as part of the investment bank’s acquisition of commodities trading company J Aron & Co. He was appointed as president and chief operating officer in 2004. Solomon joined Goldman Sachs in 1999 and became global co-head of the investment bank in 2006. He became COO in 2016.“Our firm has demonstrated great resiliency and strength over the last 12 years,” Blankfein said in a statement. “I’ve never been more optimistic about our ability to serve our clients effectively and generate industry-leading returns. “David is the right person to lead Goldman Sachs. He has demonstrated a proven ability to build and grow businesses, identified creative ways to enhance our culture and has put clients at the centre of our strategy. Through the talent of our people and the quality of our client franchise, Goldman Sachs is poised to realise the next stage of growth.”last_img read more

Man Group ESG framework to exclude coal, tobacco from funds

first_imgSandy Rattray, Man Group CIOIn addition, all funds going beyond the “base standard” for responsible investment would be subject to enhanced stewardship and engagement activities.Jason Mitchell, co-head of responsible investment at Man Group, said the introduction of the fund framework and the exclusions list marked a “milestone in the formalisation and progression of our approach to responsible investment”.Group CIO Sandy Rattray said: “We see clear demand from institutional investors for managers to demonstrate their commitment in this area and put action into words – with the introduction of both the responsible investment fund framework and the responsible investment exclusions list, we are doing just that.“These developments will seek to ensure a clear and consistent approach to responsible investment across Man Group’s range of strategies, and inform the way we deliver our approach to ESG investing to meet the multitude of client preferences.” UK-listed asset manager Man Group has introduced a firm-wide responsible investment exclusion list and fund framework as part of a bid to answer calls for investment managers to demonstrate their commitment in the burgeoning area of environmental, social and corporate governance (ESG) related investing.Man Group portfolio managers running funds meeting more than a “base standard” for responsible investment will no longer be allowed to invest in tobacco companies or companies that derive more than 30% of their revenues from producing coal or providing coal-based energy.Companies involved in the production of controversial weapons – such as anti-personnel mines, cluster munitions, and chemical, biological or nuclear weapons – are also on the new exclusion list.The policy on controversial weapons was already in place, but has been formalised under a responsible investment “fund framework” applied across all Man Group funds.   Man Group today also announced it had established an exclusions committee, which would focus on developing guidelines to direct the exclusions and report to the group’s responsible investment committee.‘Credibility, clarity and consistency’The new fund framework, the $114bn (€100bn) manager said, was “designed to establish a baseline requirement of ESG standards, and to provide credibility, clarity and consistency in Man Group’s approach to responsible investment across its range of funds”.Funds would fall into three categories: the base standard, a standard for funds with a further level of responsible investment integration, and a standard for funds dedicated to responsible investment.As part of the introduction of this framework all Man Group funds would receive “100% proxy voting”. IPE understands that portfolio managers will be able to exercise votes pertaining to all stocks in which their funds are invested. This was not previously the case.last_img read more