AkademikerPension in Denmark has terminated its collaboration with State Street Global Advisors (SSGA), partly for ESG reasons – a blow for the US asset management giant less than a month after a similar loss in the UK.
Anders Schelde, chief investment officer of the DKK157bn (€21bn) pension fund for academics, said: “The decision is primarily driven by our new equity strategy, but we also assess that State Street’s changed approach to active ownership and responsible investments no longer meets our expectations.”
The member-owned pension fund said it put high demands on how external asset managers handled sustainability, active ownership and responsible investments, and had a strict assessment process carried out by its ESG team in collaboration with the investment teams, which awarded managers an A to C rating — with C being the lowest.
“As a consequence of this approach, we have decided to terminate our collaboration with State Street Global Advisors,” the pension fund said.
Schelde said that the pension fund’s high standards for sustainability and responsibility in its investments did not mean its asset managers had to think in exactly the same way, since these were complex issues and there might be different paths to achieve the same goal.
“But they must be in line with our fundamental approach and the way we see the world,” he added.
In late February, the People’s Pension in the UK appointed Amundi and Invesco to manage £28bn (€34bn) of its assets with a focus on responsible investment, which reduced the amount of assets managed by State Street from £32bn – all the fund’s assets — to around £5bn.
The UK master trust said the appointments represented “a step forward in achieving greater alignment with The People’s Pension’s stewardship approach and priorities and will allow it to continue to evolve these high standards”.
A year ago, State Street became one of the US financial institutions to quit the Climate Action 100+ investor coalition amid the ESG backlash in the country.
A spokesman for SSGA said: “As shared by AkademikerPension, the decision to reduce the use of external managers was prompted by an exercise to increase insourcing capabilities.
“As a manager with approximately $50bn in AUM for Nordic institutional investors, a 35% year-over-year increase in AUM, State Street Global Advisors looks forward to continued discussions with MPIM on future opportunities,” he said.
MP Investment Management (MPIM) is AkademikerPension’s investment management arm.
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Rachel is IPE's Nordic correspondent.
She has long been a freelance writer, and over the years, has written for The Telegraph, The Independent, The Observer, AMWatch and elsewhere.
In 2001, Rachel's personal finance book Kickstart Your Money was published by John Wiley & Sons.View full Profile
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