Global equity manager, Stewart Investors, has partnered with local fund-hosting specialist, Implemented Investment Solutions (IIS), to launch its flagship sustainable shares strategy as a portfolio investment entity (PIE) for the NZ market.
The new international equities PIE mirrors the Worldwide Leaders Sustainability Strategy – a portfolio of 40-60 large- to mid-cap global stocks run to sustainable standards by Stewart.
Targeting listed firms across the world with a market cap of at least US$5 billion, the Stewart strategy “selects companies that are positioned to contribute to, and benefit from, sustainable development”, according to a release.
“As a result, the strategy has an 85 per cent lower carbon intensity than the MSCI All Country World Index (ACWI) benchmark,” the statement says.
The manager is big on transparency, too, publishing data on portfolio holdings (which, includes Fisher & Paykel Healthcare in NZ) showing their impact on sustainable goals.
Founded in Edinburgh in 1988, Stewart is a pioneer in the environmental, social and governance (ESG) investment field, launching its first sustainability strategy in 2005.
David Gait, Stewart investment team head, said the PIE fund provides another option for “like-minded investors in the region”.
“Investors are increasingly wanting to see their own values reflected in their portfolios, and there is very high demand for sustainable investments in New Zealand,” Gait said.
IIS chief, Anthony Edmonds, said the mix of a professional, well-regarded sustainable global shares strategy with the tax-efficiencies of the PIE structure would find support among a wide range of NZ investors.
“Many wholesale investors and advisory groups now realise the significant tax slippage associated with offshore-domiciled funds,” Edmonds said. “We’ve seen a surge in interest from these groups who want to access quality global fund managers but with the benefits of well-structured PIE funds like this new offering from Stewart Investors.”
Featuring an underlying annual management fee of 0.62 per cent, the new Stewart PIE has Public Trust as supervisor with BNP Paribas Securities Services providing custody and administration.
Stewart is a sub-brand of First Sentier Investors, the former Colonial First State entity now owned by Japanese financial conglomerate, Mitsubishi UFJ Trust and Banking.
Last month IIS launched another sustainable-flavoured global shares fund for underlying manager, Dimensional Fund Advisors (DFA). Unlike the relatively concentrated, active management style of the Stewart strategy, the DFA fund follows the ‘smart beta’ indexed approach invented the-now global mega-manager in the 1980s.
Several other NZ investment firms are now offering global sustainable funds as PIEs including Devon (feeding into strategies run by Wellington); Salt, which uses Morgan Stanley and Cohen&Steers as underlying managers; and, Harbour through a fund managed by T Rowe Price and Mirova.