Headquarters of Shell on London's Southbank. Credit: VV Shots via iStock
Goldman Sachs Asset Management (GSAM) has been appointed by various pension entities and a captive insurance company related to Shell and its subsidiaries to manage a $40bn (£29bn) outsourced chief investment officer (OCIO) mandate.
The appointment – which represents one of the largest ever multinational OCIO mandates – will see GSAM manage Shell's international pension plan assets in Europe, including around £11.5bn ($15.6bn) in the UK. It will also see GSAM provide advisory services for Shell's pension plans in North America.
The deal – which represents one of the largest ever multinational OCIO mandates – follows a competitive tender process overseen by Isio.
Each individual Shell pension fund set clear objectives and selection criteria for the tender process, met with potential candidates locally and ultimately made their own selection decision as part of the process.
Goldman Sachs said the asset pools in each respective market will be provided with bespoke and flexible services in order to meet their varying needs and objectives.
As part of the mandate, Shell's pension plan trustees will have access to the global investment capabilities of Goldman Sachs across public and private markets.
GSAM said some of the mandate includes management of liability-driven investing (LDI) and cashflow-driven investing (CDI) – expanding its position in these markets and adding to the approximately $300bn (£221bn) it currently manages globally in LDI and CDI portfolios.
The transitions are expected to complete later in 2025.
GSAM said the appointment meant it now had nearly $450bn (£332bn) in OCIO assets under supervision and marked a "significant step forward" in the wider European OCIO market as pension plans, insurers and other asset owners recognized the potential governance, performance and cost benefits of outsourced solutions in an increasingly complex environment.
Goldman Sachs global head of asset and wealth management Marc Nachmann said: "Pension funds, insurers and other asset owners increasingly want differentiated alpha, holistic total portfolio advice and customized portfolio solutions, delivered through an exceptional client experience.
"They recognize that OCIO partners can have deeper investment expertise, technology resources, and operational infrastructure to help meet objectives. We are proud that Shell's pension fund trustees across several countries have chosen to partner with us to deliver the full capabilities of Goldman Sachs for their members."
Goldman Sachs Asset Management co-head of Europe, Middle East and Africa institutional client coverage Chloe Kipling added: "Our approach to OCIO services is underpinned by extensive risk management experience and driven by a focus on building strong client partnerships.
"We look forward to implementing bespoke solutions that seek to manage risk, generate cashflow and deliver sustainable returns on behalf of members of the Shell international plans."
The appointment comes after Shell's Dutch pension scheme, the Shell Pension Fund Foundation (SSPF), appointed BlackRock as its fiduciary manager last year to look after around €27bn of assets.
