ERAFP, the French pension fund for civil servants, has awarded mandates for the management of its US equity portfolios, which now include dedicated mid-cap investments.

The pension fund did not previously have dedicated US mid-cap mandates, but added these when it last year launched a call for tenders ahead of its US large-cap mandates expiring at the end of 2020.

Today ERAFP announced it had chosen BFT Investment Managers, with the financial management delegated to Morgan Stanley Investment Management, for US mid-cap equities.

The mandate is for around €150m, according to ERAFP. Schroder Investment Management and Amundi are on standby.

Ostrum Asset Management and Oddo BHF Asset Management have been awarded US large-cap mandates for around €1.1bn in total. According to ERAFP, they have delegated the financial management to Loomis Sayles and Wells Cap Management, respectively.

Sanso IS, and BlackRock have the US large-cap equity standby mandates.

According to ERAFP’s most recent annual report, Ostrum and Robeco were its previous US large-cap managers.

The mandates are for benchmark-outperforming conviction-driven management.

As is standard for ERAFP, the portfolios must comply with the pension fund’s socially responsible investment framework. The managers must also support ERAFP in achieving its climate change mitigation objectives, ERAFP noted.

AP7 re-appoints ISS for ESG mandate, seeks treasury review help

Sweden’s AP7 announced it is re-appointing a division of environmental, social and governance (ESG) services firm Institutional Shareholder Services (ISS) for both parts of an ESG mandate, which was tendered in November 2020.

Stockholm-based ISS-ESG won the two parts of the tender, with a total estimated value of SEK5m (€493,000) each, having already provided the services to the SEK722.5bn pension provider for several years.

The tender was part of an expected renewal that was subject to Sweden’s public procurement act, according to AP7.

The first part was for norms-based screening, controversial weapons screening, cannabis screening, Paris climate agreement screening, norms-based engagement, semiannual bespoke reporting and ad-hoc support.

The second, meanwhile, was for custom proxy research, custom proxy voting and ad hoc support, according to the tender document.

AP7 reported it received three tenders for the first part and two for the second, before re-awarding both to ISS-ESG in a contract concluded on 17 May.

Additionally, the pension fund has announced it is looking for a firm to cover the administrative aspects of a review it will conduct into the prospects of streamlining various treasury processes.

The processes concerned are financing, liquidity risk management, collateral management, counterparty management, and cash management including currency and securities lending and borrowing, according to AP7.

The pension fund – which is the state-operated default fund in Sweden’s defined contribution premium pension system – said the scope of the procurement was for the winning firm to cover the administrative aspects of the upcoming review, and to provide it with support, analysis and advice as described.

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