Master trust roundup: People’s Pension cuts £226m based on ESG standards

No comments

The People’s Pension, a UK-based master trust, has removed £226m (€266m) worth of investment in companies that have failed to meet its rigorous ESG standards.

The workplace pension scheme has worked closely with its fund manager State Street Global Advisors (SSGA) on the policy that led to the initial removal of approximately 150 stocks from its portfolio, it announced.

The divestment targets controversial weapons companies as well as organisations linked to severe controversies involving human rights, labour, environment, and corruption, it said.

Jon Cunliffe, managing director of investments at B&CE, provider of The People’s Pension, said: “We’ve taken the significant step of divesting from companies which fail to meet our ESG standards because of the risks they pose to member accounts and the reputation of the scheme.”

He said the move was “in the best interest of our members” as engagement with such companies would be “unlikely to work”.

“Both SSGA and our trustees have worked very hard to get to this point, and we know that this decisive action will have the support of our members as our polling tells us that responsible investment is important to them,” he said.

Alistair Byrne, managing director, head of retirement strategy at State Street Global Advisors, added: “ESG considerations are an increasingly crucial aspect of the investment strategy of any pension scheme. We are delighted to have been able to work with The People’s Pension to design and implement these changes, creating a more robust and sustainable default fund for their millions of members.”

River and Mercantile hires head to develop master trust offer

Asset manager River and Mercantile (R&M) has appointed Britt Hoffmann-Jones as head of proposition development within its solutions business to develop the firm’s master trust.

The master trust will be available for UK defined benefit (DB) and defined contribution (DC) pension schemes in the UK.

With more than 15 years of experience, Hoffmann-Jones has a track record of advising both DB and DC pension schemes. She has held various senior positions within the investment management sector, most recently as head of proposition development at independent trustee and governance services provider PTL.

“I am thrilled to be back at R&M at a time of strong growth and opportunity for the fiduciary management division,” she said. Hoffmann-Jones had an almost five-year stint at the firm between 2010 and 2015 as a managing director, asset solutions, and head of UK DC pensions.

Ajeet Manjrekar, co-head of solutions at R&M, said: “As the first firm to offer fiduciary management in the UK to both DB and DC pensions schemes, we’ve never sat still. In this ever-changing industry, pension schemes need to keep pace, so we’ve always looked to evolve and enhance what we do in response to changing client needs, regulation, cost pressures and the demand for better technology with faster access to information.”

He added that around 70% of schemes will undertake some form of consolidation in the next five years so all DB schemes should be formally considering “the most appropriate strategic framework and operating model to deliver their member commitments”.