Van der Velden led Ownership Capital wins $750m in four pension fund seed mandates

Ownership Capital, the Amsterdam-based asset manager co-founded in January 2013 by Alex van der Velden, former Head of Responsible Equity Investments at PGGM, the Dutch pension fund manager, has won its first assets after three UK pension funds and a Danish scheme handed it four separate mandates worth a total of $750m (€579m) for its concentrated, long-term, engagement-based strategy. The UK schemes investing are the fund of food giant Unilever, The Pensions Trust and the Environment Agency Pension Fund (EAPF). The Danish pension scheme has not been named. The sizes of the individual mandates were not disclosed, although they would appear to be in the range of €100m+ for each fund. Ownership Capital has won the money after 18 months of fund raising, a relatively short period of time for a new manager, but based on a track record of running assets for PGGM’s innovative €3bn Responsible Equity Portfolio, which takes concentrated, long-term bets in a small number of companies. Van der Velden started Ownership with a lift-out of the team running that fund at PGGM, including Antoinette van Lier, Investment Director, Otto van Buul, Portfolio Manager, and Francois Schockaert.
 The team left PGGM in September 2012. Ownership Capital’s strategy is close to that of the PGGM fund, limited to 20-30 stocks based on large stakes, fundamental research and a pre-investment engagement approach that seeks to identify potential value in sustainability and governance themes and work with the company onrealising that value over time. Ownership says it aims to make equity investments where it will hold the stake for ten years, in an effort, it says, to align the long-term success of well-managed companies with the duration obligations of pension funds. It did not disclose the terms or timescale of the new mandates. Van der Velden, Partner and Chief Investment Officer of Ownership Capital said the fund would also lower its management fees as it brings in new clients to reflect economies of scale, which he said was a further indication of alignment with pension funds. He did not disclose its current fee structure. He said the fund manager was looking to work with a relatively small number of large pension funds for the strategy. Mark Mansley, Chief Investment Officer of the £2.4bn (€3bn) EAPF, said: “We were impressed by Ownership Capital’s commitment to stewardship, investing responsibly in companies for the long-term in a way that enhances returns by implementing the recommendations Professor (John) Kay made in his review.” The Kay Review of 2012 stressed the importance of long-termism in institutional investment as well as agency problems in the fund management chain. The manager’s Chairman is Sir George Buckley, former CEO of US industrial group 3M, who the Ownership team met as part of a PGGM engagement. Van der Velden said the US industrials sector was typical of one where Ownership would focus its investment: “Aside from a small number of companies like 3M, many industrials in the US do not have a sustainability strategy and we think there is value over the long term in working with good, well-priced companies to build one and demonstrate its financial worth.”