Mandate roundup: Hounslow, PIRC, Hermes, TMI, BNY Mellon, Prudential, NEST, NOW: Pensions
EUROPE – The £600m (€719m) fund for the UK local authority of Hounslow has appointed a replacement for its proxy-voting provider Manifest, first tendered in March.
According to the recently published mandate award, PIRC will now oversee the fund's proxy voting for three years, with an additional two-year extension possible.
The award added that PIRC would be expected to vote on behalf of Hounslow at approximately 200 events for its UK, European and US holdings.
PIRC most recently was successful in retaining one of the UK's largest local authority schemes, the £8.7bn West Midlands Pension Fund, as its client.
Of its £597m in assets under management (AUM), the fund invested 69% in overseas and UK equity.
Oil and gas producer BG Group, which today saw its stock price fall to a two-year low on the back of predictions that it would not grow output in 2013, was the local authority scheme's largest single investment at the end of March, according to its most recent annual report.
This accounted for 1.9% of total AUM.
It has similarly large exposures to bank Standard Chartered, telecoms company Vodafone and British American Tobacco, and its 10 largest equity holdings account for one-sixth of total assets.
At a recent meeting, the pension fund committee further agreed to extend investment consultant Allenbridge Epic's contract by an additional two years.
According to the meeting's minutes published earlier this week, the decision was both due to satisfactory work undertaken by the company and over concerns that the timing for re-tendering the position was "not good".
In other news, Hermes Fund Managers – the firm originally set as the BT pension scheme's fund manager – has selected Deutsche Bank's platform, dbSelect, to launch its new absolute return commodity strategy.
The Hermes investment process is based on a multi-strategy approach operating algorithmic models across 20 commodity curves, complemented by fundamental research.
The strategy covers an investment universe of 25 liquid commodities and offers daily liquidity.
Hans Jacob Feder, global head of dbSelect at Deutsche Bank, said "substantial" interest in commodity strategies continued, as investors and managers welcomed the liquidity and transparency benefits offered by managed accounts.
Meanwhile, Thomas Miller Investment (TMI) has signed a 10-year administration and custody outsourcing agreement with BNY Mellon.
BNY Mellon's Asset Servicing group will be responsible for TMI's institutional business, while Pershing, a BNY Mellon company, will service its private investment management business.
The agreement with BNY Mellon covers both the onshore and offshore business requirements of TMI.
Lastly, Prudential has announced that it is working with both NEST, the National Employment Savings Trust and NOW: Pensions – the independent multi-employer trust supported by the Danish pension scheme ATP – to provide auto-enrolment solutions for a number of its corporate pension clients.
Prudential will provide a single approach to auto-enrolment for many of its clients, but in some instances employers with a diverse range of employees will require a dual-scheme approach.
The collaboration with NEST and NOW: Pensions will give employers a choice of complementary auto-enrolment solutions, Prudential said.