UK - The £6.3bn Royal & SunAlliance Pension Scheme is reviewing its investment process. A key element will be to consider investments in UK and European companies should be on a sector rather than geographical basis.
The move follows last week’s decision by Staffordshire County Council’s £1.4bn pension scheme to review its analysis method – including looking at investments on a sector basis.
Royal & SunAlliance Investments spokesman Peter Marshall said the RSA scheme uses analysis on a sector basis with fund managers adding a geographic-specific perspective.
Marshall added: “The bigger houses are going down a sectoral basis. Markets are becoming more independent and are looking to identify additional value – the move towards sector investment has grown up.”
Imperial Tobacco Pension Scheme chief investment officer Will Mather, though, doubts whether widespread change is imminent.
He said: “There is a real trend for overseas investment, but the real move to sector investment will not come any time soon.
“More pension funds are considering sector basis investment – yet many more people have not yet taken the leap. Investment in pension funds is becoming more open minded which has definitely been off the back of the Myners' review.”
J Sainsbury Pension Scheme manager Geof Pearson said: “In the future there is a need for diversification of funds in order to even out pension assets over countries. This reduces domestic exposure and provides a greater diversification of the fund.”
Bacon & Woodrow partner in investment practice Kerrin Rosenberg said: “More and more schemes are looking at global sectors rather than overseas regions to manage their portfolios. Increasingly pension funds are looking at global sectors such as global technology, oils and pharmaceuticals.”
By Shifa Rahman
Canada Life has signed a £351m bulk annuity contract insuring the pensioner liabilities of 2,510 members and dependents in the AA UK Pension Scheme.
In this week's Pensions Buzz, we want to know if you believe there is ever a case for combining retirement savings products with other savings products, and if the PPF levy for sponsorless schemes is appropriate for DB consolidators.
The Insolvency Service has disqualified four directors of trustee firms from running companies for a total of 34 years following an investigation.