Australian asset manager Pendal Group – formerly BT Investment Management – has announced it is to take full ownership of Regnan, the ESG advisory firm it co-founded with Commonwealth Superannuation Corporation (CSC).
The announcement that the listed Australian fund firm will acquire the remaining 50% stake in the Sydney-based firm from CSC, the super fund for Australian government employees, was made via the Australian stock exchange today. Financial terms of the deal were not disclosed.
CSC, which provided the seed funding for Regnan – then BT Governance Advisory Service – when it launched in 2001, described it as the “right time” to transfer its stake in the firm and “support its transition onto an international distribution platform”.
Alison Tarditi, Chief Investment Officer at CSC, will step down as a director of the ESG house following the completion of the deal.
Pendal and CSC took over at Regnan in 2015 when several large institutional investors withdrew to become clients instead.
Regnan’s CEO Pauline Vamos, formerly CEO of the Association of Superannuation Funds of Australia (ASFA), stepped down in August last year after just over a year in the role to “pursue other interests”. She is now chair at the CIMA (Certified Investment Management Analysts) Society of Australia and Freedom Insurance.
According to the ASX release, the planned acquisition will help support its “continued focused on stewardship”.
Pendal currently manages A$2bn (€1.25bn) in “dedicated sustainable and ethical strategies” and the move would enhance Regnan’s offering, using Pendal’s insights “across equities, fixed income and multi-asset portfolios”.“Full ownership of Regnan will allow us to further support our clients on their journey to fully embed ESG into their frameworks, and also improve our ability to be a more active steward of their capital across all our investment capabilities”, said Richard Brandweiner, CEO of Pendal Australia.
Alison George, Regnan’s acting-CEO, added: “This represents an exciting next chapter for Regnan, allowing us to further develop our research and engagement capabilities and to have them more deeply embedded in investment processes to improve outcomes for investors.”
Staying in Australia, this week also saw the release of the much-anticipated report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry. The report, which makes over 80 recommendations, highlighted remuneration as a main contributor to the poor conduct in Australia’s banking sector.
Brynn O’Brien, Executive Director at the Australian Centre for Corporate Responsibility (ACCR), responding to the report, slammed the “wilful misconduct by banking and financial services executives, inadequate whistleblowing protections, uninterested and disengaged investors, and authorities suffering from catastrophic impotence and ineptitude”.
She added: “It is ludicrous that it took a Royal Commission for institutional investors to collectively vote against remuneration packages and in the case of AMP, directors. Corporate democracy is weak if those in positions of power do not use the accountability tools available to them. Large investors should have taken action much sooner across the financial services sector.”