London CIV, the asset pooling vehicle for the capital’s 32 local authority pension funds, has launched a global equity core fund, with Morgan Stanley Investment Management as delegated investment manager.
The fund’s objective is to generate total return, comprising both capital growth and income, over a long-term period, typically five to 10 years.
It is structured as a segregated, concentrated portfolio of high-quality companies that is free of sectors such as tobacco, alcohol and fossil fuels. The portfolio’s carbon footprint is 95% lighter than the MSCI World Index per $1m invested.
Jason Fletcher, CIO at London CIV since the spring, said: “London CIV is delighted to be adding MSIM’s quality-driven, ESG-integrated portfolio to the London CIV family of funds. Responsible investment has become an increasingly important consideration for asset owners and at London CIV we are continuing to develop solutions that meet with these high expectations from our 32 client funds.”
In Jacqueline Jackson, London CIV has had a head of responsible investment since the summer.
William Lock, managing director and head of the international equity team at MSIM, said the mandate from London CIV “illustrates the increasing demand we are seeing for ESG-integrated strategies that demonstrate a low-carbon track record”.
London CIV said that at the end of July, its assets under management had reached £9bn (€9.8bn), which combined with £10bn invested in passive strategies, had taken the percentage of London pension funds’ pooled assets to over 50%.
In October last year it launched an infrastructure fund, indicating it was working on real estate funds, too.