Swedish state pension fund Fjärde AP-fonden (AP4) has put around €125m into two engagement funds run by Governance for Owners, the UK-based firm that recently announced it was focusing solely on investment.
AP4, which has SEK260bn (€29bn) in assets, has invested €75m in the GO European Focus Fund, the activist investment fund that was set up in 2005.
And it has put a further JPY7bn (€49.5m) into the TMAM-GO Japan Engagement Fund – doubling its initial investment in the fund that was made when it was launched in March 2012. The fund engages with small and mid-cap Japanese companies to address strategic, financial and governance issues.
“AP4 is delighted to make these investments into funds that we feel make a difference,” said AP4’s CEO Mats Andersson.
“Improving the performance of companies and making them more sustainable fits very well with AP4’s long term investment philosophy.
“Our experience with the Japan Engagement Fund has been excellent, with returns far outstripping the market, and we have seen real change at Japanese portfolio companies. We look forward to more of this in Japan and also now in Europe”.Steve Brown, the GO co-founder who recently took over as chief executive from Stephen Cohen, said AP4’s backing was a “powerful endorsement” of GO’s constructive approach to improving companies.
“Investments into funds that we feel make a difference”
“There are excellent opportunities in both Europe and Japan right now and we look forward to capitalising on these for the benefit of AP4 and our other investors”.
AP4’s Head of Corporate Governance Arne Lööw holds the 2014 chairmanship of the AP funds’ Ethical Council.
GO, which was established in 2004 by former senior executives at Hermes Fund Managers, last month revealed that it would split off its five-string Stewardship Services arm to GES, the Stockholm-based ESG research house.
The move would enable GO – whose shareholders include Railpen and CalPERS – to focus solely on investment.