Month: September 2020

European Parliament brings board-gender equality rules closer to fruition

first_imgHowever, MEPs encouraged member states to support SMEs and incentivise them to improve gender balance on their boards, too.MEPs also proposed that the rules apply to companies where women comprise less than 10% of the workforce.Parliament called for a transparent, open and meritocratic recruitment procedure in which gender balance was borne in mind throughout.“Where candidates are equally well qualified, priority should go to the candidate of under-represented sex, at every stage of this procedure,” it said. “Qualifications and merit must remain the key criteria.”Parliament added that companies failing to comply with the new rules would be required to justify themselves to the competent national authorities in their respective member states and describe the measures taken and planned to achieve them in future.Penalties, such as fines, might be imposed for failing to follow transparent and open appointment procedures, rather than for failing to achieve the target, Parliament said.“Where candidates are equally well qualified, priority should go to the candidate of under-represented sex, at every stage of this procedure.”MEPs also proposed that “exclusion from public calls for tenders” should be added to the list of possible penalties, which they say should be mandatory, rather than indicative, as the Commission proposes.Rapporteur Evelyn Regner said: “It is important the directive be broad in scope and that many listed companies be required to use the open and transparent procedure when selecting their non-executive directors.“We do not have an exemption for family enterprises or specific sectors, but we have strengthened the penalties member states should apply when companies do not fulfil the directive’s requirements.”A similar position on the draft rules will now have to be reached by the EU Council before negotiations between the Parliament and the Council can start. The European Parliament has approved draft rules to ensure at least 40% of non-executive board members at EU-listed companies are women by 2020.As part of Brussels’ plan to promote gender equality in economic decision-making, the Parliament backed a Commission proposal to ensure gender balance on boards for publicly listed companies, pointing out that, in 2012, only 15% of non-executive board members at the EU’s largest companies were women.As part of the agreement voted yesterday, MEPs established that listed companies will have until 2020 to reach the target, while public ones should do so by 2018.In adopting the new measures, backed by the Women’s Rights and Gender Equality and Legal Affairs committees, Parliament stressed that the rules would not apply to small and medium-sized enterprises.last_img read more

ESMA launches consultation on mandatory clearing of swaps

first_imgBecause of the difference in timing of the corresponding CCP authorisations, it said the IRS and CDS classes were covered in two separate papers and consultation periods. There was a large overlap between the two to give stakeholders the chance to review them and give feedback at the same time, it said. The regulator also said the two consultation papers might be followed by more on other asset classes.Within IRS, ESMA’s draft standards propose that basis, fixed-to-float, forward-rate agreements and overnight index swaps should be centrally cleared.Within CDS, European untranched index CDS — for two indices — should be centrally cleared, according to the draft standards.However, ESMA decided equity and interest-rate futures and options did not need a clearing obligation at this stage.The IRS consultation paper is open for feedback until 18 August, while the CDS paper is open until 18 September. Two consultation papers have been published by the European Securities and Markets Authority (ESMA) on draft regulatory technical standards (RTS) for the clearing of interest rate swaps (IRS) and credit default swaps (CDS).The European regulator is developing the standards as part of the European Markets Infrastructure Regulation (EMIR), which is aimed reducing systemic risk.ESMA said it had analysed the two classes of derivative instrument and decided some IRS and CDS classes should be subject to the clearing obligation in central clearing houses (CCPs).ESMA said it was required to draft the technical standards on the clearing obligation within six months of CCPs being authorised or recognised.last_img read more

Swiss pension fund members willing to sacrifice returns for sustainability

first_imgMore than 70% of pension fund members in Switzerland want their schemes to apply sustainability criteria when selecting investments, according to a survey commissioned by RobecoSAM.Approximately 40% of the 1,200 participants surveyed said they would be willing to sacrifice returns in exchange for sustainable investments, with 20% of that number willing to give up as much as half the return. More than 70% of respondents said they were convinced the application of ESG criteria would lead to more cautious investment decisions and probably even better ones.Roughly the same percentage of participants said they would even be in favour of making it legally mandatory for Pensionskassen to apply certain sustainability criteria. The survey also found that participants now require more transparency from Pensionskassen with respect to their investments, as well as more in-depth analyses of portfolios according to ESG criteria.The vast majority of respondents also welcomed the Swiss National Bank’s announcement that it would sell the bonds of “ethically questionable” companies it held in its portfolio until earlier this year.RobecoSAM said awareness of sustainable investments increased in conjunction with respondents’ age and education levels.last_img read more

PPF’s in-house management decision not motivated by costs – CIO

first_imgGreater control over asset selection, rather than cost concerns, was the main driver behind the Pension Protection Fund’s (PPF) decision to in-source asset management, according to the scheme’s CIO.In its strategic plan published earlier this year, the UK’s £20bn (€28.6bn) lifeboat fund gave weight to ongoing efforts to reduce the number of external asset managers, citing the spiralling cost of its contracts.The PPF provides a safe-haven for defined benefit (DB) pension schemes whose sponsoring employers have become insolvent.It uses a number of external asset managers, while running manager selection and asset allocation itself. However, Barry Kenneth, the fund’s CIO, said control would be the “first and foremost” reason to in-source any management, given the team’s understanding of the portfolio’s risk exposures.The PPF has previously said fund manager fees were expected to increase by one-third, or £38.6m, over the 2015-16 financial year.The increased costs – in total, £120.1m for 2015-16 and rising to nearly £133m by 2017-18 – would be due to the growing exposure to alternative assets.While Kenneth backed the earlier position of only in-sourcing where the scheme could reduce costs, he denied it would be the basis of any decision.“We know our framework better than anyone else, so, by definition, we should be able to manage it, knowing everything else within the fund, and do so in a more controlled fashion,” he said.“That is the main desire to bring assets in-house.”A number of the fund’s asset managers have been granted discretionary mandates controlling asset selection, with the PPF only vetoing investments over a certain value.By bringing management in-house, the fund’s team would be able to react to market events while accounting for the impact on other portfolio investments.“We know what we want and how we are thinking about the fund,” Kenneth said.“Effectively, when [external managers are] adding assets, we probably have a view on how that fits in.”However, he added: “If we do not think we can do it better and more efficiently, we will not do it for the sake of it.”The PPF had previously said it would not build up in-house competence in areas where it did not expect to invest for the long term.At the end of March 2014, the PPF had more than £15bn in debt instruments and was building up a 12.5% allocation to “hybrid” assets – which provide liability-matching income streams combined with asset growth – such as long-lease property.Kenneth said the fund would be unlikely to ever take 100% of any asset class in-house, as his team would still need a benchmark to measure against.“We always want to learn, so if there are managers we interact with, we need to be able to bounce ideas off them,” he said. “It is also good for the board to see how we perform against others.”He said managing assets would be the next evolution for his team, one he has led for two years, given that asset class decisions were not even made in-house prior to his arrival.“We will do this bit by bit and in a logical manner and ensure the risk to the board and investment team is kept to a minimum,” he said. “We are not under time pressure – doing it properly is more important.”last_img read more

Dorset Pension Fund reshuffles managers on £500m of equity mandates

first_imgThe £2.1bn (€3bn) Dorset County Pension Fund has appointed three managers to invest nearly £500m in global equity mandates after undergoing a review.At present, Pictet Asset Management and INTECH Investment Management, a subsidiary of the Janus group, manage the local government pension scheme’s allocations, but the managers were put under review earlier this year.Dorset invested approximately one-quarter of its assets in global equities – £350m with Pictet, £111m with Intech and £64m with JP Morgan Asset Management through an emerging markets mandate.Intech manages US equity investments, while Pictet manages global equities and has done sone since its appointment 25 years ago. Dorset has now announced three new managers for global equity investments, appointing Investec Asset Management, Wellington Management International and Allianz Global Investors.Investec and Wellington will now share a £240m allocation to global active (ex UK) and emerging markets, while Allianz was awarded a global smart beta equity mandate of the same size.Investec and Wellington have been appointed on long-only active management mandates, with a preference for fundamental discretion with the managers, over systematic strategies.Allianz’s smart beta strategy will manage indices on a factor basis or a fundamental strategy, and also exclude emerging market stocks.The mandate winners came out on top of a manager selection process that generated 39 responses, with consultancy bfinance running the process.According to Dorset’s annual report for the 2013-14 financial year, Pictet underperformed its benchmark on an annual, triennial and five-year basis, down 1 percentage point over the latter.Intech outperformed its benchmark by 50 basis points over the year, 40bps over three years and 30bps over five.last_img read more

Danica sees more business potential in Sweden, Norway

first_imgBut Klitgård said the result from the company’s insurance operations increased by 9% to DKK1.34bn before tax.“The performance,” Danica said, “was adversely affected by the financial market turbulence experienced in the third quarter but favourably affected by improvement in the health and accident business.”Investment returns were down sharply compared with last year, with the net return on customer funds for the with-profits Danica Traditionel pension plan just 0.6% in the nine-month period after 10% in the same period in 2014.However, Danica said that, after it made a change to additional provisions, the return for Danica Traditionel was 3.2% compared with 5.5%.Returns for the unit-link products Danica Balance and Danica Link came in at between 0.5% and 2.1% for the first nine months.This is down from average returns for the two products reported at the half-year stage of 4.5% and 7.5%.Overall, premiums rose to DKK22bn between January and September from DKK20.3bn in the year-earlier period.Within Denmark alone, premiums fell slightly to DKK14.4bn from 14.8bn.In Sweden, premiums were up 44% to DKK6.2bn, while in Norway premiums rose 10% to DKK1.4bn.In both of these countries, the increases had been due to higher single premiums as well as a stronger inflow of new corporate customers early in the year.It said it worked more closely with its parent Danske Bank in the two Nordic countries on selling pensions and comprehensive products to personal as well as business customers.It also said it continued implementing its new investment strategy in the reporting period, aimed at generating long-term returns “at the top end of the market”.The strategy includes more direct investment in companies and more alternative investments, including property.Danica Pension’s total assets came to DKK355bn at the end of September 2015 from DKK353bn at the same point last year.Danica is the country’s second-largest commercial pensions provider after PFA Pension. Denmark’s second-biggest commercial pensions firm Danica Pension witnessed a 44% surge in premiums in its Swedish business in the first nine months of this year and 10% growth in Norway, and said it expected to make still more out of these markets.Announcing interim figures for January to September, Per Klitgård, chief executive of the Danske Bank subsidiary, said: “We see further potential in both markets in the short as well as in the long term.”He described the growth notched up by the two Nordic subsidiaries as a continuation of a positive trend.At DKK1.49bn (€200m), Danica Pension’s pretax profit was below the DKK1.51bn figure reported for the same period last year.last_img read more

LPFA, Lancashire ‘anticipate’ GMPF tie-up amid pooling shortfall

first_imgIt is one of the most advanced of the partnerships, having last year named Michael O’Higgins as its chairman, but, with combined assets of approximately £11bn (€14bn), it is unclear whether it will gain the DCLG’s approval, as it does not yet meet the £25bn asset target set by the government.The LPFA acknowledges this shortfall in its response to the DCLG:“We welcome the government’s ambition to achieve pooling within the sector but recognise the ALM Partnership will be required to expand its pool to achieve [its] target criteria,” it said.It confirms the partnership’s “commitment to wider pooling” and sets out the discussions it has had with LPGS “groupings and individual funds” to date and the outlook in this regard.It has exchanged letters of intent and is in discussions “around how to best work together” with the Greater Manchester Pension Fund (GMPF), the Merseyside Pension Fund (MPF) and the West Yorkshire Pension Fund (WYPF).The funds have total assets of around £35bn.The GMPF is the largest local authority fund in the UK (£17.6bn), with substantial in-house management.The LPFA refers to the “very significant in-house expertise” of all three of the northern funds in its consultation submission.“Given the timescale, discussions are at an early stage,” it said. “But the next steps between now and July are for all participants to develop a proposal around how the pooling arrangement will work and meet the government’s criteria.“All parties anticipate the discussions reaching a successful conclusion.”The LPFA already works with the GMPF on infrastructure, having in January last year launched a £500m investment vehicle for infrastructure and alternative assets – the joint venture announced its first investment in October.As concerns the new pooling arrangements called for by the government, the LPFA and its Lancashire partner have also had talks with the Royal County of Berkshire Pension Fund.The LPFA noted that Berkshire “has indicated in a paper to their Pension Fund Committee that the ALM Partnership pool will be their preferred route for pooling purposes”.The LPFA and LCPF “hope to include Berkshire in the wider pooling discussions”, they said.For its part, the Berkshire Pension Fund in its draft response to the government noted that it agreed that “Officers should continue discussions with the London Pensions Fund Authority and Lancashire County Council and other nascent pools”. Further cost savingsThe LPFA and Lancashire County Council are aiming to start pooling all assets from April, with the expectation that the Financial Conduct Authority (FCA) will approve the operating vehicle of the organisation, an Authorised Contractual Scheme (ACS), by the end of next month.The two funds have jointly invested around £1.5m in start-up costs to provide the foundations for a pool.“The scale of commitment required to get this type of arrangement off the ground is not to be underestimated,” they said, “and we have been happy to share our learning with colleagues from other funds, even when they are seeking to create alternative pools.”They estimated saving some £30m over the next five years on investment management fees, a conservative estimate based on “the experience of just our two funds collaborating thus far”.Investment outcomes, meanwhile, could be enhanced by around £20-£30m by the funds’ increased scale, also on a conservative basis, according to their report.“Given our commitment to wider pooling, we fully anticipate further cost savings to emerge from the detailed analysis that will take place between now and July,” it said.The submission to the government also makes a case for the ALM Partnership’s infrastructure investment capability – noting, for example, that participation in overseas transactions had allowed the team within the partnership “to develop relationships with significant overseas pension funds that potentially will allow the ALM Partnership (and any wider pool that is created) to participate in some larger deals as co-investors”. The Lancashire County Pension Fund (LCPF) and the London Pensions Fund Authority (LPFA) are in talks to partner or work with the Greater Manchester Pension Fund, among other UK local government pension schemes (LGPS), having acknowledged that their partnership had failed to meet the government’s target size for LGPS pooling arrangements.The LCPF and LPFA were the first schemes to announce a partnership, doing so even before the UK government launched a consultation on reforms of the LGPS, which called on the schemes to pool investment assets.English and Welsh LGPS have until today, 19 February, to report to the Department for Communities and Local Government (DCLG) on their commitment to pooling and the steps they have taken in this direction.There are currently eight asset pools emerging from talks among the LGPS, including the partnership between the LPFA and LCPF.last_img read more

Dutch pension fund liabilities to grow after longevity revised upward

first_imgAccording to the AG, boys and girls born in 50 years’ time are likely to live 3-4 years longer.If the Dutch government accepts the AG’s latest estimate, it will have to raise the official retirement age for the AOW state pension, as well as the target age for additional pensions.The AOW age would have to increase to 67 and three months in 2022, and it would have to be set at 68 in 2027, rather than 2029.Further into the future, the AG said it expected the official retirement age to rise to 69 by 2035, 70 by 2044 and 71 by 2053.It suggested the target age for additional pensions should be increased to 68 by 2018 – one year earlier than recommended by Statistics Netherlands (CBS) last year.The AG said the government now needed to make a decision on the ages for the AOW and additional pensions before the beginning of next year. Longevity in the Netherlands is set to increase, with pension funds’ liabilities for men rising by 0.3% and for women by 0.9%, according to estimates from the Actuarial Society (AG). The organisation said it based its estimate on a discount rate of 1%, adding that liabilities would increase by 0.1% and 0.6%, respectively, if the discount rate were 3%.The AG, which produced its previous longevity report in 2014, said it expected girls born in 2016 to live for 93 years on average – an increase of six months.Life expectancy for boys born this year remains unchanged at 90.1 years.last_img read more

Dutch roundup: PGGM, NXP, Qualcomm, remuneration survey, PMT

first_imgPGGM – asset manager for the €185bn healthcare scheme PFZW – argued that remuneration policies had become overly complex, leading to unpredictable results.It has invested €20m in NXP – a former subsidiary of Philips – through listed equity and has also unspecified private equity holdings in the company.In other news, a survey by The Pensions Rating Agency (TPRA) suggests that less than half of industry-wide and occupational pension funds are transparent about the remuneration of their board members.The TPRA said many pension funds had also failed to provide clarity about the remuneration of their supervisory boards and board committees.The agency, which assessed 68 schemes in total, said the issue was less important at company pension funds, as their board members were usually employed by the sponsor.It found that less than one-quarter of the schemes paid their trustees more than the non-binding guideline of the Dutch Pensions Federation, which has set a maximum of €140,000 for a full-time board member at a large scheme, and €125,000 and €100,000 for medium-sized and small schemes, respectively.According to Michaël Deinema of TPRA, pension funds have not explained why they exceeded the guidelines.Lastly, the €68bn metal scheme PMT has committed €400m to invest in affordable rental property over the next four years.According to CIO Inge van den Doel, the pension fund is aiming at the large group of people who do not qualify for social housing and cannot afford non-regulated rental property or to buy a home.A spokesman for MN, PMT’s manager, added that returns were expected to be similar to non-regulated rental housing because of the low-risk profile, the low vacancy level and low vacancy costs.PMT has a €750m residential-property portfolio, with almost 45% in the affordable-housing segment. The €200bn asset manager PGGM has blasted the more than €360m bonus for the chief executive of Dutch chip-maker NXP after the company was taken over by US-based Qualcomm.In a statement, it described the bonus – in shares and as well as share options – granted to chief executive Rick Clemmer as “totally unacceptable”.It called on the company’s remuneration committee, its supervisory board and Clemmer reduce the remuneration considerably for the sake of the company’s stakeholders.The asset manager said it was acceptable to share part of a company’s profit as a bonus with its board and staff, but it said it was opposed to “individuals gathering disproportionate financial assets”.last_img read more

People moves: New director for Shell’s Dutch pension funds [updated]

first_imgVan ‘t Zet has also been appointed as an executive trustee at SNPS. He has been legal counsel at the Pensioenbureau since 2013, having joined from Watson Wyatt where he was a senior consultant.Sigrid Juselius Foundation – Former Ilmarinen CIO Jussi Laitinen has taken up the role of chief executive at the Sigrid Juselius Foundation in Helsinki. He replaces Christian Elfving, who retired at the end of last year.Laitinen headed up Ilmarinen’s investment operations from 2001 to 2008, and then became chief executive of Aktia Bank for nine years until March 2017. He started work at the Sigrid Juselius Foundation at the beginning of this year.UK Labour party – Debbie Abrahams, a member of the UK Labour party, the official government opposition, has been removed from her position as shadow work and pensions secretary. According to multiple national media reports in the UK, Abrahams had been accused of bullying members of her staff – claims she has denied.  Troy ClutterbuckNOW: Pensions – The UK defined contribution master trust has confirmed Troy Clutterbuck as its permanent CEO. He took the role on an interim basis in August following the abrupt departure of Morten Nilsson, who had led the company since its launch in 2011. He first joined NOW: Pensions as chief financial officer in 2016, after a 15-year career with the Jardine Lloyd Thompson Group.NOW: Pensions – wholly owned by Danish pension giant ATP – is the UK’s third-largest auto-enrolment pension provider with more than £600m (€687m) in assets under management. It is the pension provider for IPE International Publishers.In July last year it withdrew itself from the UK regulator’s list of approved master trusts following administration problems, and was fined in February this year for “persistent administrative failings”.BLPK – The Swiss pension fund for the canton of Basel-Landschaft has found a new head of asset management: Thomas Monetti will be joining the CHF9.7bn (€8.1bn) pension fund from 1 September. He replaces Roland Weiss who will retire after 17 years as head of investments at the BLPK. Monetti joins from the CHF5bn pension fund for the canton of Solothurn.Amundi – The French asset management giant has appointed Yerlan Syzdykov as global head of emerging markets. He replaces Mauro Ratto, who has “decided to explore new opportunities for the next stage of his career”, according to Amundi.Syzdykov was made Ratto’s deputy in July last year following Amundi’s acquisition of Pioneer Investments. At Pioneer, Syzdykov was head of emerging markets bond and high yield, having joined the group in 2000.Mercer –  Robert Baker has been named diversity and inclusion consulting leader for Europe and the Pacific region at the global consulting group. The company said Baker would “drive growth in Mercer’s diversity and inclusion consulting services throughout the region by helping clients build the diverse and inclusive workforces they need for the future”.He has worked at Mercer for more than 20 years as an investment consultant and latterly as a global client director, working on multi-national accounts.Robeco – Mark van der Kroft has been appointed as head of a new “trend and thematic” investment team for the €152bn Dutch asset manager Robeco and RobecoSAM as of 1 June.Until March 2017, Van der Kroft had been working for Robeco as sales manager for Dutch institutional clients and as CIO for equity for 16 years. Last year, he was named director of strategic institutional business development at the €246bn asset manager NN Investment Partners.The new 18-strong team is the result of a merger between Robeco’s trend investment team and two thematic investment groups from RobecoSAM. It operates from Rotterdam and Zürich and manages 10 funds, focusing on themes such as smart energy, sustainable water, sustainable and healthy living, and worldwide fintech stocks. It has €7bn in assets under management.Axa Investment Managers – The French asset manager has hired Matthew Murtagh as a senior consultant relations manager. He is based in London and will be responsible for European clients. He joins from boutique investment firm Oaktree Capital Management where he was assistant vice president for marketing and client services. Prior to this he worked in marketing and consultant relations at Schroders.Invesco – The investment management giant has appointed Tom Sartain as a senior portfolio manager in its London-based fixed income team. He will work on the group’s global multi-sector offerings. He previously held a similar role at Schroders, where he worked with Gareth Isaac, now CIO for Invesco’s fixed income team in Europe, the Middle East and Africa.Hermes Investment Management – The £33bn asset manager has added two new hires to its fixed income team in London. Stephane Michel joined as a senior portfolio manager on 19 March. He works on the group’s asset-based lending platform and the wider multi-asset credit offerings. Andrew Lennox joined as an asset-backed securities (ABS) portfolio manager on 3 April and will focus on the European ABS market. Kempen Capital Management – Kempen has appointed Athole Skinner to the role of senior investment manager in its Edinburgh-based European small-cap team. He previously ran his own research company, Hirta Investment Research, but has also worked at Alliance Trust, Scottish Widows and Schroders during a 20-year career. Shell Netherlands, Sigrid Juselius Foundation, UK Labour party, NOW: Pensions, BLPK, Amundi, Mercer, Robeco, Axa IM, Invesco, Hermes, KempenShell Pensioenbureau – Kenan Yildirim has been appointed as director of the Shell Pensioenbureau – which runs Shell’s two pension funds, SSPF and SNPS – in the Netherlands as of 1 May. He has also joined the executive board of SNPS, Shell’s defined contribution scheme for workers who joined since 2013.Yildirim succeeds Janwillem Bouma, who starts as a trustee at the €7.4bn pension fund Hoogovens, the Dutch scheme of Tata Steel, as of 2 June. Yildirim was finance director at Shell Netherlands and has held different financial positions at Shell since 1999. Prior to this, he worked at Unilever.The Shell Pensioenbureau also named Martin van ‘t Zet as senior legal counsel and compliance officer. He takes over from Stefan Tabak, who has taken on a different legal position at Shell.last_img read more