UK - The £630m Shropshire County Council Pension Fund has signed up Isis Asset Management to provide SRI overlay to a £80m UK indexed portfolio.
The fund will adopt Isis’s responsible engagement overlay service (reo) to the portfolio which has been managed by State Street Global Advisors since 1995.
The move stems from a strategic alliance Isis formed with SSgA in September 2001 to offer reo as part of a package with SSgA’s index tracking funds.
Shropshire County Council chair of the pensions committee, Derek Woodvine, said: “Having taken the decision to become more socially responsible in the management of our pension funds we decided to opt for the reo service, because of the unique approach it employs which separates the investment process from the engagement process.
“This approach will allow us to fulfil our fiduciary duty while remaining socially responsible because there is no compromise in terms of investment returns.”
Reo differs from the traditional approach to ethical investment in that it engages with companies to encourage them to be more socially responsible rather than using screening to exclude them from the investable index. Director, institutional funds at ISIS Asset Management, Polly Watts said: “We believe that reo is an attractive proposition for pension funds providing them with a long term commitment to engagement which protects and enhances shareholder value through addressing areas such as the environment, climate change, labour standards and human rights.”
Industry Voice: Sponsored by Eaton Vance
This week's top stories included Cardano announcing plans to acquire Now Pensions from a Dutch pension fund later this year.
Royal Bank of Scotland (RBS) faces a £102m impact on liabilities as a result of equalising guaranteed minimum pensions (GMPs), according to its annual results.