Brunel launches £1.2bn Sustainable Equities Fund

Brunel Pension Partnership Limited has said it aims to go “beyond traditional responsible investing” with the launch of its Sustainable Equities Fund with a mandate of £1.2bn.

The pooled Local Government Pension Scheme fund’s creation of the sub-fund comes after requests from clients for a listed equity portfolio in which environmental, social and governance (ESG) considerations were at the forefront of the investment process, and where the managers would positively pursue companies that benefit society.

The fund selected three managers, whittled down from 70 expressions of interest, who will be charged with integrating ESG metrics throughout their whole investment process including their decision making, stewardship, policies and strategies.

The appointed managers are Ownership Capital CEO and co-founder, Omar Cordes, RBC Global Asset Management (UK) head of global equity, Habib Subjally, and Nordea Asset Management CEO, Nils Bolmstrand.

The portfolio opened with a significant underweight to GICS energy sector and an aggregate carbon intensity that is significantly lower than the MSCI All Country World Index, which it uses as a benchmark.

Brunel stated that the newly launched portfolio would go beyond its current portfolios in terms of managing ESG risks, in which managers actively seek exposure to companies providing solutions to sustainability, whilst also targeting a financial return.

Brunel Sustainable Equities Fund portfolio manager, David Jenkins, commented: “We were delighted to find managers who share our understanding of sustainability, embedding it deep into their culture and investment processes.

“This portfolio therefore meets our aspiration to go beyond traditional Responsible Investing and ensure that the managers are engaged with the companies and are investing in them for positive reasons, not simply focusing on negative exclusions.”

Subjally added: "Brunel Pension Partnership has a deep commitment to Responsible Investing and we consider them to be thought leaders and innovators in this area. We are delighted, therefore, that, following a rigorous selection process, we have been appointed as one of the managers of the Sustainable Equities Fund.

“We look forward to partnering with Brunel to generate strong and sustainable investment performance, whilst simultaneously having a positive impact on the companies in which we invest for the benefit of society as a whole."

Brunel head of listed markets, David Cox, said: “The Sustainable Equities Fund gives our clients access to both the equity risk and sustainability focus they requested.

"The three managers we appointed share a broad investing style and a prioritisation of sustainability, yet their approaches are also different enough to provide clients with the diversification they were looking for.”

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