Capita Pension & Life Assurance Scheme has selected Russell Investments for a fiduciary management mandate worth £1.5bn (€1.7bn).
The appointment, which followed a competitive tender process, came as the scheme’s trustee decided to move to an improved investment governance model that would enable it to focus on the direction of the scheme’s investment strategy whilst delegating the majority of day-to-day decisions to Russell.
Fiduciary management is expected to give the scheme access to a wide range of investments, typically with lower fees, but with less complexity and time commitment for the trustee, Capita announced.
Taking responsibility for the scheme’s total assets (£1.5bn), Russell will provide strategic advice to meet the scheme’s self-sufficiency goals and will also develop and implement a “holistic investment framework” that will progressively increase the security of members’ benefits as the scheme’s membership matures, the fund added.
Russell will also provide continuous oversight of portfolio strategy and implementation, dynamically managing the scheme’s assets to generate return, manage risk and maintain diversification.
The scheme said that particular emphasis would be placed on the inclusion of ESG considerations within the new investment arrangements.
Andy Wadley, trustee chair for the Capita scheme, said: “We believe Russell Investments’ experience and proven pedigree in strategic advice, portfolio implementation and ESG will be highly beneficial in helping us meet our investment objectives.”
Russell has set a goal for its global business operations to be carbon neutral by 2030, and to reach net zero carbon emissions by 2050 or sooner across all its investments.
This aligns with Capita’s commitment to be carbon net zero across all parts of its business, including its supply chain, by 2035, Wadley noted.
Russell has over 40 years of experience providing fiduciary management solutions and services, currently managing more than £83bn in fiduciary mandates globally.
Jim Leggate, managing director, UK institutional and Middle East at Russell, said:“We are delighted to partner with the Capita Pension & Life Assurance Scheme and believe our insights, strategic advice, and investment and implementation expertise, will deliver a highly effective solution to meet the scheme’s long-term goal of reaching self-sufficiency by 2026.”