SJP drops Aberdeen Standard as ethical manager

St. James’s Place has dropped Aberdeen Standard Investments (ASI) and appointed Impax Asset Management to run its £286m ethical fund after a sustained period of underperformance.

SJP

The St James’s Place Ethical fund was previously run by ASI senior investment manager Jamie Cumming. Under Cumming’s management, the fund has underperformed over a one, three and five-year basis, generating returns of 6.9%, 35.8%, and 33.5% respectively, versus 8.3%, 40.4%, 57.6% for the LF Global Equities sector, according to FE Analytics.

SJP announced that Kirsteen Morrison and David Winborne of Impax Asset Management will now manage the fund and that it will be renamed the Sustainable and Responsible Equity (SRE) fund.

Chris Ralph, chief investment officer at SJP (pictured), said: “This strategy adopts a differentiated philosophy which effectively integrates ESG considerations, as both a source of growth and a risk factor, into a more traditional, fundamental investment process.

“The fund will invest in globally-listed companies which stand to benefit from the transition to a more sustainable global economy.”

What next?

Portfolio Adviser contacted ASI but the firm declined to comment on Cumming’s future after being removed from the fund. He is part of a team managing around £15bn which includes the Aberdeen Global Responsible World Equity and Aberdeen Ethical World Equity funds.

ASI has seen a number of high profile exits since the £11bn merger of Aberdeen Asset Management and Standard Life Investments in August 2017. Earlier this month, an eight-strong equity team left ASI for Aviva Investors to join equities CIO David Cumming who left ASI in December 2017.

Performance

Ian Simm, CEO of Impax Asset Management, said being selected by St. James’s Place to run its sustainable strategy is a “great honour and testament to Impax’s approach and the team’s track record”.

“The strategy for the Sustainable and Responsible Equity fund will move beyond merely applying a negative ethical screen to taking a positive approach, which is the hallmark of our successful investment style of the past 20 years,” he added.

“This reflects the changing needs of the private client market who want to invest with managers who are proactively supporting the development of a more sustainable economy.”

Diversified Assets fund

SJP also announced the launch of the Diversified Assets fund, which subject to regulatory approval, will see KKR appointed as manager.

Ralph added: “The launch of the Diversified Assets fund provides an exclusive opportunity for St. James’s Place clients to invest in a diversified portfolio of public and private market assets within a single investment fund.

“This strategy will offer our clients access to private market assets which have, historically, only been available to institutional investors.

“KKR has a world-leading, global investment team and will be responsible for targeting growth opportunities in a number of markets, and will provide exposure to private equity, real estate, infrastructure, as well as private and public credit.”

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