PGGM, Europe's second largest pension fund with e50bn assets, has taken a step forward in sustainable investment, awarding a e5.5bn mandate to London-based fund managers Friends Ivory & Sime (FIS).
The socially responsible investment (SRI) mandate will be managed using FIS's new standalone responsible overlay programme (reo) that until now was only available to those clients with a fund management contract with the firm.
The 'engagement approach' of the programme aims to work with the companies invested in to encourage them to improve management attitudes regarding social, environmental and ethical issues and will be applied to PGGM's in-house managed continental European and passive UK equity assets.
Alfred Kool, director of corporate communications at PGGM in Zeist, says: "Following a review of the SRI offerings on the market, we were in no doubt that Friends Ivory & Sime are in our opinion the leaders in this specialist area and able to meet our specific requirements." He believes that FIS's new standalone responsible engagement service will provide added value to scheme members. "We are confident that FIS's dedicated team and their combined expertise to encourage companies to move towards best practice will continue to deliver change and great results," he says.
Gary Mairs, managing director for retail & institutional business at FSI believes that reo is becoming recognised as the premier SRI solution for pension funds at a time when the demand for this type of product is growing among institutional investors across Europe.