UK - Fund managers are offering pension schemes a poor choice on socially responsible investment, Watson Wyatt claims.
The consultant’s first SRI paper – Socially Responsible Investment for Pension Funds: Putting a Conscience Into Your Portfolio – blames a lack of resources at fund mangers.
The reason – according to the paper’s author, senior investment consultant Noel Grant – is that the contribution of SRI to a fund manager’s revenue and profit is still small.
He said: “SRI does not yet attract the most talented investment professionals – the key part of any process.”
But he said SRI could eventually be used by pension funds as a distinct investment style as part of a diversified portfolio, rather than as a concept which must apply to the entire portfolio.
He pointed out that SRI funds were not subject to the types of construction discipline and risk control that institutional investors expected and that fund managers relied too heavily on external company and market research in their processes.
Grant said that while these issues appeared to be “damning views”, fund managers should look to the future.
He believed that better teams and products would emerge as the investment case became stronger.
“If SRI is going to make an impact in the institutional arena, we need to consider the approach in a different way – simply as another investment style or strategy, in just the same way that we view value or growth investing,” predicted Grant.
Females can expect to live a greater number of years in poor health than males, according to data from the Office for National Statistics (ONS) for 2015 to 2017.
Scottish higher-rate taxpayers will benefit from more pensions tax relief than workers on the same salary anywhere else in the UK as income tax bands continue to diverge.
Schemes risk breaking the law and being forced to wind up as The Pensions Regulator (TPR) warns some may be master trusts but do not know so.
As a hectic 2018 draws to an end, Jonathan Stapleton wishes readers a quieter 2019.