The £2.8bn (€3.4bn) Avon Pension Fund has awarded a £150m emerging markets equities mandate with strong responsible investment criteria to institutional boutique Unigestion.
The fund had tendered the mandate – representing around 5% of its total assets – in July 2013, saying corporate governance and responsible investment criteria would form 5% of the selection criteria for the five-year contract.
“The pension fund is working towards achieving the UN PRI [Principles for Responsible Investment] standard and therefore will take this into consideration when evaluating the tender,” Avon said.
The fund in the west of England said the benchmark is the MSCI Emerging Markets Index with a rolling three-year outperformance objective of plus 2 to 4 % per annum, net of fees.The fund, the 17th largest within the Local Government Pension Scheme, said it received 43 tenders for the mandate.
Although not a PRI signatory itself, the Avon fund does have a comprehensive responsible investing policy in place, and encourages its external investment managers to become PRI signatories.
Geneva-based Unigestion, which has around $14bn in assets under management, has some 250 institutional clients. In the UK they include Railway Pension Investments Ltd., Merseyside Pension Fund, the London Borough of Hammersmith & Fulham and the West Midlands Pension Fund. It launched its emerging markets equities product in 2010. Last November it announced that its environmental sustainability fund of funds offering, the Unigestion-Ethos Environmental Sustainability Fund, had made a commitment to the Armstrong South East Asia Clean Energy Fund.