The five global portfolios will target ‘best-in-class’ passive ESG-rated equities and bonds. Each model’s equity allocation will vary from 100% to 20% and will invest across a range of regional equity funds and/or two fixed income funds.

The equity element will invest in the Amundi SRI PAB equity funds, which track MSCI SRI Filtered PAB regional indices. These focus on the top 25% ESG-rated companies relative to their sector peers and have a wide range of systematic environmental- and social-based exclusions – for example, they exclude companies generating revenue from thermal coal mining or oil and gas extraction.

These indices also align with the EU Paris-Aligned Benchmark (PAB) regulation minimum requirements, including: a reduction in carbon intensity by 50%, compared to the underlying investment universe; and a reduction in carbon intensity by 7% on an annualised basis.

Meanwhile, the SRI fixed income element invests in two bond funds managed by Northern Trust Asset Management, which track Solactive Global Bond ESG Climate indices. These are focused on a global investment grade bond universe that is screened for ESG scores and carbon emissions, including targeting a 50% reduction in corporate bond carbon intensity compared to the parent index. EBI added risk in the SRI bond element is reduced by blending the two fixed income funds to target a shorter duration than the wider market.

See also: Pacific, Albemarle and Hymans Robertson model portfolios added to Parmenion platform

Jonathan Griffiths (pictured), investment product manager at EBI, said: “We know investors seek to invest in line with their values, while also seeking competitively priced investment solutions. With the launch of the SRI portfolios, we are in the sweet spot where these two elements align. Providing enhanced ESG screening, and market-leading equity exposure aligned with the EU Paris-Aligned Benchmark minimum requirements, these portfolios are an exciting addition to our product suite and the wider MPS space.”

Ashkan Daghestani, head of ETF, indexing, and smart beta sales for UK & Ireland at Amundi, added: “We are pleased to be selected by EBI, which will enable more and more UK investors to have access to our low-cost SRI index-based solutions. This partnership demonstrates our commitment to meeting the needs of UK investors, in particular for ESG index solutions at competitive pricing.”

EBI is part of Bristol-based platform Parmenion and has £2.5bn in assets under management. It runs a range of passively managed investment products including a Core ESG and Earth range for sustainable investors, and factor-based global portfolios, the World range, and Core, for market-based global exposure.

This article was written for our sister title ESG Clarity

Coldstream Wealth Management

Seattle-based wealth manager will merge with Paracle Advisers.

The combined RIA group, under the Coldstream brand, will have $5.7bn (£4.1bn, €4.7bn) in client assets.

The financial details of the deal were not disclosed.

Investcloud

The financial digital solutions provider has acquired financial planning technology firm Advicent for an undisclosed sum.

The cloud services provider aims to create the “world’s leading financial planning solution” by leveraging on Advicent’s cash flow, trust and tax planning offering.

People Moves

RBC Wealth Management

The wealth firm has opened a Roanoke, Virginia office which welcome The Meridian Group from UBS.

The group manages around $900m in assets and specialises in financial planning and asset management for high net worth families and businesses.

The team comprises Edward Link and Michael Kemp, both managing directors and financial advisers; Bradley Blum, senior vice-president and financial adviser; Allison Link, financial adviser; Virginia Riddle, senior financial associate; Michaela Frantz and Judith Honaker, both senior registered client associates; and, Kristy Joyce, client service associate.

In other news, Jesse Witt has been hired as Phoenix complex director to lead 71 advisers and 57 support staff across six branches in the Arizona capital.

He joins from Wells Fargo where he was a regional manager and succeeds Glen Gatch who is retiring.

Additionally, the Heald Wealth Management Group joins RBC WM’s office in Wellesley, Massachusetts, from Wells Fargo. It manages around $460m in assets and specialises in retirement income planning and asset management for HNW individuals, families and trusts.

The group is made up of: Timothy and Andrew Heald, both senior vice-presidents and financial advisers; and Elyse Slotnick, senior client associate.

Northern Trust Wealth Management

Ana Nuñez has been promoted to senior managing director of the private client advisory team in Miami.

She will succeed Eric Vainder, who was recently promoted to market executive for Broward County.

Nuñez has been at Northern Trust for 22 years, serving in various senior roles.

BNY Mellon Wealth Management

The wealth manager has named Bryce Walker as senior client strategist in Tampa, Florida.

He will work with UHNW families.

Walker was previously vice-president of asset management and capital advisory at PNC.

Amerilife

The life and health insurance provider has recruited Mark Springett as senior vice-president for enterprise data and analytics.

He most recently served as head of data science, business intelligence and data at Allianz Life.

Sun Life

The international financial services provider has promoted Yaniv Bitton to vice-president and head of investor relations and capital markets, based in Toronto, Canada.

He has been at the firm since 2016 holding several senior positions.

Lafayette Square

The New York-based investment platform has recruited Ommed Sathe as head of strategy, a newly created role.

He joins from Prudential where he was head of the impact investing unit.

RGT Wealth Advisors

The Dallas-based financial advisory firm has hired Steve Novak as a managing director.

He joins from Morgan Stanley where he worked as an executive director for over two years.

It will encourage more people in the investment and savings profession to be visible and share their stories through joining the firm’s Project 1000.

Project 1000 is a global five-year drive to spotlight 1,000 LGBT+ and supportive ally role models, all working within the industry. The movement has attracted representation from over 60 different firms in three continents and works collaboratively with the Diversity Project and other initiatives.

The WriteToInspire campaign builds on the momentum of LGBT Great’s initiatives and serves as a powerful reminder about the importance of the equality movement and the progress taking place in the investment and savings profession.

Through highlighting the positive actions taken by individuals and firms, LGBT Great is changing perceptions of the investment and savings industry and ensuring that it is seen as an inclusive choice for all prospective employees.

In the UK, LGBT History Month is held throughout February to raise awareness on the challenges faced by the LGBT+ community historically.

The theme this year is about inspiring others through writing, and WriteToInspire highlights the visibility of LGBT+ and ally Project 1000 role models, who have all contributed an online written bio as a beacon of inspiration to others.

Significant contributions

The WriteToInspire campaign specifically spotlights four Project 1000 role models, including:

• Emma Palethorpe, a programme manager at St James’ Place Wealth Management;
• Seamus Kearney, a second vice-president from Northern Trust;
• Justin Onuekwusi, a fund manager from Legal and General Investment Management; and
• Ann Lynch, a business analyst from Schroders.

LGBT Great has selected these four individuals based on their contributions to diversity and inclusion. LGBT Great’s global member firms also spearhead the campaign which celebrates LGBT History Month and aims to help increase progress towards the 1,000 goal.

Matthew Cameron, managing director of LGBT Great, said: “The simple concept of role modelship is having a significant impact across our industry by providing minorities with the confidence that they need to succeed.

“Just a few years ago, there was no support for LGBT+ visibility at a time when expectations from employees, clients and investors were increasing. Our members are proud to mark LGBT History Month, and we hope that this will have a positive impact by encouraging others to follow their lead.”

International Adviser‘s parent company, Last Word Media, is the exclusive industry media partner of LGBT Great.

For more insights on diversity and inclusion, please click on www.diversityq.com

The initiative urges leaders in the industry to support LGBT+ equality throughout the sector.

LGBT Great reached out to 50 C-Suite representatives who have committed to work towards greater equality.

As Last Word is the exclusive media partner of LGBT Great, International Adviser can reveal the first five leaders who have pledged their support:

• Simon Haslam, group chief financial officer and board member of Fidelity International;
• Laura Mason, chief executive of Legal and General Retirement Institutional;
• Penny Biggs, executive vice-president of Northern Trust;
• Peter Harrison, chief executive of Schroders;
• Andrea Rossi, chief executive of Axa Investment Managers.

Catalyst for progression

Matthew Cameron, managing director of LGBT Great, said: “This campaign marks a clear turning point for the industry and proves that there is real appetite to drive LGBT+ equality forward from the top.

“We have been encouraged by the overwhelming support from leadership to influence the agenda and hope that the campaign will be a catalyst for future progression in the industry and beyond.

“The progress in fifty years has been monumental and with a stand of inter-sectional solidarity from those in power, there is a real opportunity to move the agenda forward at a much faster pace.”

The full list of 50 industry leaders will be published on 5 July 2019.

A long way since Stonewall

The Stonewall riots of 1969 are widely considered as the starting point for the LGBT+ equality and human rights movement.

This is why, 50 years later, inclusion and diversity are still important issues that need talking about, said Colette Comerford, inclusion and culture leader at Legal and General Investment Management.

She is also one of LGBT Great’s industry role models.

“This continues to drive the importance of visible leadership support for LGBT+ inclusion, and sends a strong message to LGBT+ people, those working in the investment profession or prospective talent, that they can be themselves.

“These leaders recognise the value of an inclusive culture and in driving equality on gender, gender identity and sexual orientation – across all aspects of diversity.

“I am encouraged by seeing LGBT+ leaders across the industry step up, take action and make a difference for everyone.”

Support progress

“There is no doubt that we have seen positive progress for LGBT people since the movement started,” said Jan Gooding, chair of Stonewall, one of the leading LGBT+ charities in the UK.

“However, there is still a lot to do to translate legal change into everyday experience. Employers therefore need to ‘come out’ as supportive allies and what’s more, this is a way of signalling an actively inclusive culture to everyone who works in your company.”

The #50for50 campaign follows LGBT Great’s research, Aiming for Great, which found 92% of LGBT+ employees working in the financial services industry highly value visible support from board-level executives.

State-run investment giant China Asset Management, for example, established its Luxembourg Ucits fund range in 2010 to tap European investors. However, assets of these funds – sold via its Hong Kong subsidiary – totalled just 0.7% of its total AUM this year ($454.9m).

Japan’s Nikko Asset Management, meanwhile, now sells 13 funds across Europe. However, total assets stood at just $309m at the end of January, accounting for just 0.14% of its total AUM.

Similarly, Seoul-headquartered Mirae Asset Global Investments, which operates in 12 European markets, has just 1.96% of its AUM sourced from European investors.

Hong Kong-based Value Partners, meanwhile, which has five Ucits funds in Europe, has only sourced $211m, or just 1.3% of its total AUM, according to the report.

More than 4,000 asset managers already serve the European market offering at least 32,000 investment products which means Asia-based asset managers are wading into a highly competitive region.

Different distribution landscape

Asia-based managers seeking to launch or build operations in Europe have found European markets extremely challenging with additional knotty considerations, according to the Northern Trust report.

More than 4,000 asset managers already serve the European market offering at least 32,000 investment products, the report states, which means Asia-based asset managers are wading into a highly competitive region.

Unlike the Asian market, the European market is 73% institutional, which means distribution is largely business-to-business, with limited sales made directly to the retail investor.

“Asian asset managers who are used to selling products directly to individuals and enticing them with free phones or other inducements will find that a similar strategy will not work in Europe,” the report said.

In addition, retail distribution across Europe may vary widely from one market to another.

For example, the UK retail space is dominated by independent financial advisers (IFAs), which account for 60% of fund distribution in the market, according to the report.

The size of the IFA channel may appeal to new entrants, but it is dominated by domestic funds.

“Managers need a presence on-the-ground to understand the market and forge key relationships.” the report said.

In continental Europe, meanwhile, the study said that Asian managers wishing to offer institutional and retail products often opt to build relationships with banks, as they make up at least 80% of distribution in many countries.

However, European banks – which have been focused on driving costs down – have been reducing the number of asset managers they work with, which is driven by the Mifid II directive, the study noted.

The average bank’s third-party buy list is just 21 providers and is expected to be reduced to as few as half a dozen.

“This, in turn, may offer both challenges and opportunities for fund managers. While banks may focus on building up their range of in-house funds, they may also develop white-label agreements with specialist fund managers, giving rise to sub-advisory opportunities,” the study said.

Local offices required

In light of the complicated distribution landscape, Asia-based managers should ensure that set up a local sales team, the report suggests.

“Managers of a significant size should make their local presence felt. Smaller managers can begin with one or two targeted markets or channels, or they could selectively work with an established third party marketing firm,” it said.

Hendrik Von Ripperda-Cosyn, London-based country head and senior director for EMEA sales at Value Partners, highlighted the importance of having European operations instead of just simply registering funds in the region for distribution and replicating its Asia-focused products.

Similarly, Bea Union Investment, which joined the Swiss-Hong Kong mutual recognition of funds scheme, is facing difficulties with fund distribution in Switzerland and is now seeking a strategic partner that would help market its products to distributors. The firm does not yet have operations in Europe.

The report noted that success always take time. European fund buyers, including distributors, generally require a three-year track record before investing in a product. In addition, they are more comfortable in products with at least €100m ($115m) in AUM.

The Ucits dilemma

Establishing Ucits funds has become a common strategy for Asia-based asset managers that are planning to expand in Europe, given that the platform is recognised across the European market.

A “scattergun approach” – registering funds in each jurisdiction – on the surface makes sense and should theoretically attract the largest possible pool of clients but it carries with it the risk that it raises costs significantly with no guarantee of raising assets, according to the Northern Trust study.

“Setting up a Ucits fund structure does not mean registration in each country will be an identical experience. Different countries have different requirements, including a variety of registration costs, agent fees and marketing rules. Ensuring marketing materials, such as fund factsheets, comply in every jurisdiction can be a costly exercise,” it said.

The Ucits fund structure obviously has its merits. Managers targeting large European institutional investors as well as the retail market would be better served by Ucits funds than Cayman-registered funds, which tend to target only a small pool of sophisticated investors, the report adds. In addition, managers can launch Ucits funds in both their Asian home markets as well as across Europe.

For more insight on asset and wealth management in Asia, please click on www.fundselectorasia.com