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Impact Investing

IPE special report May 2018


Scottish fund's SRI move

Aberdeen City Council pension fund is applying Friend’s Ivory & Sime’s responsible engagement overlay (reo) programme to its £300m (E490m) passive portfolio run by State Street Global Advisors.
Last September State Street and Friend’s Ivory & Sime signed a strategic agreement enabling the former to offer the programme to its clients. Aberdeen’s indexed portfolio will be subject to the SRI overlay, allowing it to pursue social, environmental and ethical objectives without compromising financial obligations.
reo is an inclusive rather than exclusive approach to socially responsible investing in that it works with companies to make them more socially responsible rather than shunning them altogether.
Gordon Edwards, finance director at Aberdeen says: “the fund’s long term commitment to engagement is seen as protecting and enhancing shareholder value and thereby fulfilling its fiduciary duty through addressing areas such as environment, climate change, labour standards and human rights.”
Says Kanesh Lakhani, managing director with SSgA: “we have seen a strong interest in index-tracking SRI. Clients investing through index funds can now fulfil their SRI requirements.”

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