Asset management roundup: LGIM modifies target date funds for DC
Legal & General Investment Management (LGIM) has made changes to its range of target date funds for defined contribution (DC) schemes, including integrating a multi-asset fund with explicit environmental, social and corporate governance (ESG) criteria.
It will also be increasing the allocation to growth assets in the earliest retirement savings phase of the Pathway Funds and de-risking at a more gradual pace in a bid to help deliver an improved level of income in retirement.
The ESG-related change involves LGIM adopting the multi-asset fund in its Future World range as a core diversified growth component of the Pathway Funds. The fund excludes companies that fail to meet certain business practice standards and also follows LGIM’s targeted engagement process to invest in companies most committed to keeping global warming to 2°C above pre-industrial levels.
In a statement, LGIM said the changes were partly a response to direct feedback from its DC members, who had shown greater interest in sustainable investments, as well as wider demographic research conducted as part of the Pathway Funds’ governance process.
The changes will be fully implemented by the end of the first quarter of 2020. The Pathway Funds are designed to create what are referred to as investment “glidepaths” taking pension scheme members up to retirement and beyond.
A spokeswoman told IPE that there are currently £900m of assets under management in the Pathway Funds, “with a strong pipeline”.
Alpha FMC launch
Asset management consultancy Alpha FMC has launched a dedicated pensions and retail investments practice in response to “convergence accelerating betwen asset and wealth management and the traditional pensions and retail investments sectors”.
The launch has led to two new hires as directors – Bruce Davies and Dan Mahony, both from Ernst & Young (EY).
Davies previously built and led EY’s life, pensions and investments transformation capability. Mahony started his career with Prudential, helping to launch the UK’s first fixed-term annuity by founding the start-up business, Living Time. He has since led EY’s relationships with a number of prominent clients in the industry.
The aim of the new practice, according to Alpha FMC, is to help asset managers transform their business models “and respond to ever-changing client demands and technical innovations”.
Davies said: “We aim to provide a different and distinctive set of services, focused on where the market is going and not how it is traditionally structured.”
AXA IM’s Rossi steps down as CEO
Gérald Harlin has been appointed executive chairman of AXA Investment Managers (AXA IM), taking over from CEO Andrea Rossi.
Harlin, who is currently group deputy CEO and group CFO, will take up his new role on 1 December, continuing to report to Thomas Buberl, CEO of AXA. He has also assumed the role of chairman of the board at AXA IM, succeeding Christof Kutscher, who had held this role since 2014.
Rossi, who had led the asset manager since 2013, will become a strategic advisor to Harlin on December 1.