Universal Investment – Ulrich Köhne, a member of Union Asset Management Holding’s management board, is to leave the company at the end of the month for personal reasons. Until a replacement for Köhne is named, his responsibilities for infrastructure and fund management will be shared by the remaining management. Köhne has been with the company since 1999.Eaton Vance Management – Hattie Burgess Franklin has been appointed institutional business development director for the UK. Franklin has more than 10 years’ experience within the UK institutional market, having held similar roles at Hermes Investment Management and Governance for Owners. Eaton Vance Management International is a subsidiary of Eaton Vance Management and the international arm of Eaton Vance, with principal offices in London and Singapore.Vanguard Asset Management – Steve Charlton has been appointed manager of Vanguard’s defined contribution proposition for Europe. He joins from Mercer, where he was most recently a principal within the consultancy’s DC leadership team. Before then, he worked at consulting firms Punter Southall and Towers Perrin.Affiliated Managers Group – Rob Geeraets has been appointed director and head of distribution for the Benelux countries. He joins from F&C Netherlands, where he was sales director, responsible for covering all institutional client segments. Before then, he held institutional marketing roles at Lombard Odier Darier Hentsch and Kas Bank.Financial Reporting Council – Chris Hodge has been appointed executive director of strategy. He will have overall responsibility for the strategic direction and public perception of the FRC in the UK and internationally. Hodge joined the FRC in 2004 and is currently director of corporate governance.Sackers – The UK law firm for pension scheme trustees and sponsors has appointed Oliver Topping as a newly qualified associate. He joins from Slaughter and May, where he undertook his training contract. Separately, Dan Robson has joined the business development and marketing team from SJ Berwin.Franklin Templeton Investments – Peter Vincent has been appointed head of alternative sales for Europe. He joins from Fauchier Partners, where he was responsible for institutional business development and client relations in the UK and Ireland. He also held previous roles at Swiss Re, UFJ International and Bankers Trust. Alternative Investment Management Association, London Pensions Fund Authority, BlackRock, Universal Investment, Eaton Vance Management, Vanguard Asset Management, Affiliated Managers Group, Financial Reporting Council, Sackers, Franklin Templeton InvestmentsAlternative Investment Management Association (AIMA) – The hedge fund industry association has appointed Jack Inglis as chief executive. He joins from Barclays, where he was a member of the global executive committee for Prime Services and was previously chief executive at Ferox Capital between 2007 and 2010. He also spent 16 years at Morgan Stanley, where he was co-head of European prime brokerage from 2003 to 2007. The appointment follows the announcement in June that current chief executive Andrew Baker was stepping down.London Pensions Fund Authority (LPFA) – Robert Vandersluis – GlaxoSmithKline’s director of global pension investments – has been appointed to the board as a non-executive director. His previous roles include senior positions at Affinity Sutton Group and Ford Credit Europe Bank. In addition, he has served on the boards of five organisations, including the Pensions Trust. The LPFA has also announced that Michael Cassidy retired from the board at the end of September following the completion of his second and final term.BlackRock – Rachel Lord has been appointed head of iShares for the EMEA region. She replaces Joe Linhares, who, after three years leading the business in Europe, will return to the US to assume a new role as global head of BlackRock’s Platinum Client programme. Lord joins from Citigroup, where she was global head of corporate equity derivatives. Before then, she spent 13 years at Morgan Stanley.
Speaking at the Innovation Second Pillar conference in Lucerne earlier this week, the question was raised whether funds should be forced to rewrite their lending agreements so their securities are with them during the AGM season.When a security is with the borrower, the lender cannot use it to vote.Barbara Heller, managing director of proxy advisory SWIPRA, said she believed those funds that wanted to ensure they could vote should not lend.“If you want to be sure you can vote at AGMs, then you mustn’t be involved in securities lending – but the law does not forbid it,” she told delegates.Speaking in a personal capacity, Zihler added that he did not view large-scale securities lending as compatible with VegüV, saying it was important to avoid a situation where pension funds were seen as “systematically” trying to circumvent voting requirements by lending their holdings.“You can’t say that if you have leant some or a part of the shares, potentially over a longer horizon, that you won’t be forced to recall the shares ahead of an AGM,” he said.However, Dominique Biedermann, chief executive of Swiss proxy voting foundation Ethos, stressed that pension funds should not be lulled into a sense of false security over engagement, believing that their only role was to cast votes.“The most important thing is not to attend the AGMs, but in advance to engage in a dialogue with the companies and, potentially – it is not impossible – to organise a campaign ahead of the AGM to communicate one’s concerns.” Large-scale securities lending by Switzerland’s pension funds will probably be impossible under legislation requiring the schemes to exercise their shareholder rights, the industry has been warned.Florian Zihler, a lawyer working at the Ministry of Justice (BJ), said he acknowledged that pension funds were financially compensated for lending out parts of their portfolio and therefore benefitted from it, but added that the activity could not be used as a reason for domestic funds to fail to vote at the AGMs of domestic firms.His comments come after the Swiss public last year overwhelmingly voted in favour of the Minder Initiative, requiring a change to the country’s constitution.The resulting law on excessive executive pay (VegüV) also requires the country’s pension funds to vote at the AGMs of companies either headquartered or listed in the country.
He became head of investment (occupational and individual pensions) for Spain in 2010, before taking up his role as head of investment, institutional asset allocation, in January 2013.In this role, he was responsible for business development, market strategy and investments for European institutional business, covering €8bn of client assets.Martinez was CIO at Fonditel from 2009.Previously, he was portfolio manager and head of asset allocation at Santander Asset Management and portfolio manager at Banif Gestion.He was also head of fixed income at Invercaixa Gestion and Herrero Gestion.In other news, Fonditel has also appointed a new fixed income portfolio manager, Paloma Lorenzo, former fixed income manager at Aviva Gestion de Inversiones, which she joined in January 2008. Fernando Aguado, former head of investment and institutional asset allocation at BBVA, has been appointed CIO at Fonditel, asset manager for the pension fund of Spanish telecoms giant Telefónica.Aguado replaces Jaime Martinez, who previously announced his intention to pursue other projects.It is understood that the new appointment will not herald a change in management structure or investment policy for the €3.8bn investment portfolio.Aguado had been at BBVA since 1997, and joined BBVA Pensiones in 2008, working in investments and business development.
“He brought new life to the company internationally, and successfully contributed to the development of Natixis Global Asset Management’s multi-affiliate model by taking majority equity interests in H2O Asset Management and Dorval Asset Management, and by using Natixis Asset Management’s expertise to create Seeyond and Mirova,” the board added.Voisin has previously worked at Crédit Agricole Asset Management as deputy chief executive and head of asset management, and was Groupe Crédit Agricole’s CIO.The statement did not shed any light on the reasons behind his departure.Duncan has held a number of senior positions in asset management, working as CIO for equities at Cambridge Place Investment Management, head of business strategy at Newton Investment Management and COO at Quilter Chevriot Investment Management. Matthieu Duncan has been named chief executive of Natixis Asset Management, following the resignation of Pascal Voisin.Duncan will join the French manager at the beginning of April, after Voisin stepped down from the position he had held since 2007.Voisin’s sudden departure, confirmed late last week by the French press, will result in current deputy chief executive François Baralon stepping into the role on an interim basis, until Duncan joins on 4 April.In a statement, Natixis’s board thanked Voisin for his work over the last 11 years at the company.
SPH, the €9.5bn pension fund for general practitioners in the Netherlands, is reducing its number of asset managers, switching to passive investments and renegotiating mandates in an effort to focus fully on cutting costs.According to its 2015 annual report, it will also divest its “expensive” 5.2% hedge fund allocation.The scheme said it reduced total costs by almost 15% last year, in particular by lowering its transaction costs.It said it aimed to cut asset management costs over the long term by trimming its number of managers. Last year, SPH placed its emerging market equity and small-cap holdings in global passive mandates, while replacing several “expensive” active managers with a single passive manager.Excepting hedge funds and private equity, it said it had ceased paying all performance fees, adding that it intended to renegotiate mandate costs for emerging market debt and listed property.Meanwhile, SPH has placed the whole of its equity, government bond and commodities holdings under passive management.Alex de Waal, the pension fund’s director, said: “We want to have all asset classes managed passively in principle, unless the added value of active management is evident.”To reduce risks, the pension fund introduced a gradual scale for its equity and commodities investments, ranging from 50%, when funding is more than 130%, to 30%, when funding is less than 105%.Over the next three years, it aims to lower the risk profile of its non-listed real estate holdings by transferring its entire 10.1% property allocation into PGGM’s Private Real Estate Fund.Its board has also decided to start investing in local care centres, having already invested €14m in a nursing complex.The pension fund reported a net return of 1.3%, following losses of 2.7 and 0.3 percentage points, respectively, on its currency and interest hedges.It lost 3.7% on the 0.1% private equity allocation that remained following its decision in 2011 to divest the portfolio.SPH said infrastructure holdings generated 16.7% and that it wanted to increase its 2.6% allocation to 5% by 2020.Hedge funds returned 11.1%.The pension fund has 16,645 participants and pensioners, who received an indexation of 2.1%.Its funding stood at 131.6% as at the end of March.
“Our new guidelines are designed to ensure the individuals responsible for a company’s executive pay practices are held to account. We hope this can at last deliver meaningful progress on excessive top pay.”The PLSA’s corporate governance code states: “Remuneration committees should take ownership of, and be accountable for, both the remuneration policy and its outcomes. Companies should consider how they might align pay more closely with the interests of their long-term owners to position themselves best for future success.”The trade body’s comments come after BlackRock, the world’s largest asset manager, wrote to the chairs of the 350 biggest listed companies in the UK last week.The asset manager said executive pay increases should not exceed those granted to the rest of its workforce.The letter, quoted in the Financial Times, said: “In the case of a significant pay increase that is out of line with the rest of the workforce, BlackRock expects the company to provide a strong supporting rationale.”The PLSA’s guidelines also include a recommendation to vote against a company’s report and accounts if there is no statement regarding diversity policy. The UK’s pension fund trade body has added its voice to those calling for a tougher stance on executive pay.The Pensions and Lifetime Savings Association (PLSA) wants investors to oppose the re-election of remuneration committee chairs if they also reject pay packages.The recommendation is part of an updated PLSA corporate governance policy and voting guidelines, aimed at encouraging pension fund investors to be more active when voting on remuneration issues.Luke Hildyard, the PLSA’s policy lead for stewardship and corporate governance, said: “Provocative levels of executive pay are doing great damage to the reputation of British business. The failure of some companies to recognise stakeholder concerns on this issue is a major worry for pension funds as investors.
Torben Möger Pedersen, CEO, PensionDanmark“We submitted our application on 3 July this year,” he said. As yet, however, the DKK172bn pension fund is not listed on the organisation’s signatory database.The moves mean that all six Danish pension funds who left the PRI in 2013 have now become signatories once more.Four of the six funds – PKA, PFA Pension, ATP and Sampension – announced in December 2016 that they were signing up again. At the time, they said PRI chairman Martin Skancke had listened to their criticisms and the organisation had changed policies and management structure, making its plans and decisions more visible.According to the signatory database, all four rejoined between 3 January and 11 January 2017.In February 2015, following an 18-month independent governance review, signatories approved a new board governance structure for the PRI.When the six pension funds quit in 2013, they said would remain dedicated supporters of the organisation’s six founding principles, and continue to report individually on how they worked with responsible investment – including their compliance with the principles. According to the PRI’s signatory database on its website, the DKK250bn (€33.5bn) provider signed the principles on 10 July 2019.Fellow labour-market fund Industriens Pension has also decided to return to the ranks of PRI signatories, a spokesman for the scheme told IPE. Two of Denmark’s biggest pension providers have returned as signatories to the UN’s Principles for Responsible Investment (PRI), reversing their 2013 walk-out staged in protest over the organisation’s governance.PensionDanmark and Industriens Pension both confirmed to IPE this week that they had rejoined the PRI. Four other Danish funds that exited in 2013 rejoined in January 2017.Torben Möger Pedersen, chief executive of PensionDanmark, said in a statement: “PensionDanmark can confirm the membership of PRI. We are looking forward to taking an active part in PRI’s actions for responsible investments.“This is particularly regarding the efforts to measure and benchmark investors’ impact on investments that meet the vision of the Sustainable Development Goals and the central aim of the Paris Agreement to pursue efforts to limit the temperature increase to 1.5°C.”
Discount rates in Switzerland for the purposes of international accounting standard IAS 19 were negative for the first time in the third quarter of this year, the consultancy said. Though they rose again slightly in September, the firm said discount rates are still negative for shorter durations and only slightly positive for longer durations.Adam Casey, head of corporate retirement consulting at Willis Towers Watson in Zurich, said: “It is impossible to foresee the development of discount rates in the fourth quarter. However, we are preparing companies for the unusual but real possibility of negative discount rates for the 2019 valuations under IAS 19.”Willis Towers Watson said it was now the right time to ensure assumptions used for accounting purposes corresponded to the current best estimate of the development of the pension plan.“Adjustments to certain assumptions that have not been reviewed in recent years could lead to a much-needed reduction in pension fund obligations,” it said.The consultancy also suggested companies might also set out to optimise their risks by reviewing the structure of their pension plans.The pension fund index is published quarterly by Willis Towers Watson and is based on International Accounting Standard 19 (IAS 19).At the beginning of September the consultancy warned long-term pension liabilities for company pension funds in Switzerland could rise 15% as a result of the county’s discount rate turning negative. Plummeting discount rates for liabilities caused the pension balance sheets of Swiss companies to weaken in the third quarter of this year to the point where the schemes were collectively in deficit, according to Willis Towers Watson’s latest pension index for the sector.Overall, the coverage ratio — the ratio of pension assets to liabilities — fell by around four percentage points between July and September, declining to 99.6% by the end of September from 103.5% at the close of June, the consultancy reported.Willis Towers Watson said this was the first time since the second quarter of 2017 that its pension index for Switzerland was in deficit.Swiss company pension funds achieved a return on capital in the third quarter which largely matched the previous quarter’s return, the firm said, adding that this could not offset the significant decline in discount rates.
“The investment offered commensurately attractive risk/return characteristics including a significant premium for illiquidity and complexity.”According to a press release from MIDIS, the portfolio was made up of loans for projects involving onshore and offshore wind, solar, smart meters, and energy from waste and biomass power.The loans meet the Loan Market Association’s green loan principles.MIDIS said the portfolio’s annual electricity generation was anticipated to power the equivalent of 4.6 million households, with the carbon dioxide-equivalent (CO2e) avoided equivalent to taking 2.3 million cars off the road. BAE Systems Pension Schemes have invested in a synthetic securitisation of a £1.1bn (€1.3bn) portfolio of green project finance loans granted by NatWest.The investment was made via Macquarie Infrastructure Debt Investment Solutions (MIDIS) and BAE Systems Pension Funds Investment Management (BAPFIM), which is the lead investment manager for the aerospace and defence company’s pension schemes.The pension funds have around £24.5bn in total assets.Toby Buscombe, deputy chief investment officer at BAPFIM, said: “[The] transaction offered a good opportunity for us to build on our existing exposure to the UK renewables sector in a structured and non standard manner, which put the opportunity beyond the reach of many institutions.
The BAE Systems Pension Scheme has announced it has reached an agreement with its plan sponsor, the British multinational defence, security, and aerospace company BAE Systems, which has proposed a contribution worth £1bn (€1.2bn).The move follows details of its latest actuarial valuation, as of 31 October 2019, which highlights the need to accelerate deficit recovery contributions into the BAE System’s section of the pension fund in the coming months.The Airbus Section of the scheme is unaffected by these developments, it said. The next actuarial valuation for that section will be undertaken as at 31 March 2020.Following the merger on 1 October 2019 of its pension schemes – the BAE Systems 2000 Pension Plan, the Alvis Pension Scheme, the Shipbuilding Industries Pension Scheme and the BAE Systems Pension Scheme – the new trustee board agreed with the company to bring forward the actuarial valuation of the BAE Systems section to 31 October 2019 from the previously scheduled date of 31 March 2020. The fund said the actuarial valuation of the section showed a funding level of 92% with a deficit of £1.9bn. The trustees have now agreed to a new deficit recovery plan with BAE Systems with the one-off payment of £1bn.The scheme said this payment represents an acceleration of deficit contributions that would otherwise have been payable in the period to 2026 under the pre-merger recovery plans of all four merging schemes.Furthermore, in line with those recovery plans, around £240m of deficit funding will also still be paid by 31 March 2020 followed by approximately £250m by 31 March 2021, it added.Before agreeing the basis and outcome of this actuarial valuation and the new deficit recovery plan, the trustees took professional advice and consulted The Pensions Regulator (TPR).Later in the year the trustees will provide section members with a funding update which will include further information about this actuarial valuation.The effective date of the next BAE Systems section’s actuarial valuation must be no later than 31 October 2022, but trustees expect that it will be 31 March 2022.The next actuarial valuations for the other UK defined benefit schemes – the Royal Ordnance Pension Scheme, the Royal Ordnance Senior Staff Pension Scheme and the BAE Systems Executive Pension Scheme – are unaffected and will be as at 31 March 2020.