It is not the first time Ontario Teachers has been involved in the gambling industry.The CAD130bn (€80.6bn) fund bought Camelot Group, operator of the UK national lottery, in 2010.An Post, meanwhile, was the previous licence holder through the An Post Irish National Lottery Company founded after the lottery was launched in Ireland in 1986.The An Post Superannuation Scheme declined to comment, and it is unclear where the fund would place the investment within its portfolio.According to its most recent annual report, covering the year through December 2011, the €1.7bn fund invested more than half of assets in fixed income and a further 38.8% in equities.The remaining 8.6% of the portfolio was invested in property and alternatives at the time, with a 0.6% cash holding.It nonetheless marks an increase in its domestic exposure following the crash, as the fund had decreased its Irish equity holdings to 0.5% by the end of 2011, although it invested in Irish property, domestic forestry and domestic fixed income. The An Post Superannuation Scheme, one of Ireland’s largest, has been selected as the preferred applicant in a €400m bid to run the country’s national lottery.The Irish government, part of a consortium also comprising the Ontario Teachers Pension Plan and An Post itself, said it expected to formalise the agreement by December, when the first half of the €405m licence fee payment would fall due.In a statement, it added that the Department of Public Expenditure & Reform (DER) would now finalise the terms of the licence and that the consortium’s company, Premier Lotteries Ireland, would likely assume the running of the contest from October next year.The 20-year agreement will see nearly two-thirds of gross gaming revenue allocated to charitable causes, maintaining the terms of the current agreement.
He said the majority for “conservative problem commissioners” – among which he counted Hill and Jyrki Katainen, the former Finnish prime minister to be in charge of all economic Commission portfolios – was only possible after S&D entered a “crooked deal” with the European People’s Party (EPP).Giegold said the agreement, which saw two further commissioners approved that he deemed problematic, saw the grand coalition of S&D and EPP “kicking” European democracy.Hill met with initial resistance when Juncker announced the distribution of portfolios and was recalled by ECON after his first confirmation hearing left MEPs feeling underwhelmed.He was asked back for a second hearing to provide further detail on several important policy areas, including the Capital Markets Union and which areas of the non-banking sector he deemed ‘too big to fail’. The European Parliament has backed Jonathan Hill as the next commissioner for Financial Services, despite some MEPs’ ongoing concerns over his past work as a lobbyist.Following a second confirmation hearing on Tuesday, Hill saw his membership in the College of Commissioners approved by 45 votes to 13.A second vote saw 42 members of the Economic and Monetary Affairs Committee (ECON) back him as Jean-Claude Juncker’s commissioner for Financial Stability, Financial Services and Capital Markets Union, with 16 opposing.German MEP Sven Giegold, previously highly critical of the choice of Hill to oversee Financial Services, said the Socialists & Democrats (S&D) group in Parliament had been forced to approve too many questionable candidates to ensure French commissioner-designate Pierre Moscovici did not encounter any problems.
Kieran Quinn, chair of the forum, said: “It is inexplicable how Barclays can have gone back on its promise to the 2014 AGM that Sir John would step down.”Barclays has now said Sunderland is to resign at next month’s AGM.A spokesman for Barclays insisted the resignation had nothing to do with shareholder pressure but that Sunderland was simply leaving the job because he had been on the bank’s board for nine years.He said there had been no promise made by Barclays last year that Sunderland would go during the year.Barclays issued a statement on 15 April last year that Gillies, who sits on the board of Standard Life and holds other positions, had been appointed as non-executive director.It said at the time Gillies would become a member of the board remuneration committee, with the intention that he succeed Sunderland as chairman of that committee “at a date to be agreed, consistent with ensuring a smooth transition”.Before Barclays announced that Sunderland was to resign at next month’s AGM, Quinn said the fact he was still in his role was “nothing short of misleading shareholders”.“Having messed up remuneration for 2013, Sir John has, in fact, stayed on as chair and presided over another year of still unacceptably high pay for 2014, and is still in place in March 2015,” he said.“Whether it is grossly excessive bonuses, the over-investment in the substantially underperforming investment bank, support for Bob Diamond, and now £1.25bn fines for Forex misconduct, Sir John has been part of every decision that has been disastrous for shareholder returns and the reputation of the bank,” Quinn said.Diamond was chief executive of Barclays before resigning in July 2012, following controversy over the manipulation of LIBOR interest rates. The chairman of the remuneration committee at UK bank Barclays is to step down at the annual general meeting (AGM) on 23 April following years of public and shareholder criticism of large pay deals awarded to top executives at the bank.The Local Authority Pension Fund Forum (LAPFF) – which includes 64 public sector pension funds, collectively managing around £160bn (€224bn) – yesterday said the chair of the remuneration committee John Sunderland had to go from the Barclays board immediately.It said that, after controversy over the bonuses for the 2013 financial year, Barclays had made a clear statement ahead of its April 2014 AGM that Sunderland was stepping down as chair of the committee to make way for Crawford Gillies.However, 11 months later, he was still in the role, having therefore presided over another full year of remuneration decisions, LAPFF said.
The new partnership will target high-quality farmland assets across North America, South America and Australia.Jose Minaya, senior managing director and head of private markets asset management at TIAA-CREF AM, praised agriculture’s low correlation with other asset classes.“The macroeconomic fundamentals for investing in farmland,” he said, “are very positive, and we view the launch of this new strategy as a testament to the ongoing potential and attractiveness of this asset class.”He said the new fund would benefit from the local expertise of leading farmland asset managers, Westchester Group Investment Management, a TIAA-CREF majority-owned subsidiary.The EAPF’s commitment to the venture comes as it targets a 25% exposure to real assets, with commitments to date at £230m (€327m). For its part, AP2 last year announced that it would allocate a further $1bn to real assets and scrutinise its farmland holdings more closely. Sweden’s AP2 and UK local authority funds are among the backers of a $3bn (€2.7bn) global agriculture fund.The Environment Agency Pension Fund (EAPF), the Greater Manchester Pension Fund and the UK pension scheme for US manufacturing company Cummins are UK-based asset owners backing the venture, which has also attracted support from the New Mexico State Investment Council.A total of 20 investors backed the venture, announced weeks after AP2 and Greater Manchester threw their support behind Global Timber Resources, also launched by TIAA-CREF.The new agricultural partnership, TIAA-CREF Global Agriculture II (TCGA II), had a target raise of $2.5bn and follows on from TIAA-CREF’s previous efforts backed again by AP2 and a number of Canadian asset owners, including the British Columbia Investment Management Corporation.
Danish labour market pension fund Sampension saw its overall investment return narrow and unit-link pension returns dip into the red in the first quarter, weighed down by losses on equities.Business volumes grew strongly, however, with overall contributions up 8.5% from the same period a year earlier to stand at DKK2.1bn (€9.4bn), the fund said as it released interim results.The total investment return for January to March 2016 fell to DKK3.8bn from DKK13.7bn in the first quarter of 2015.The investment return before pensions tax (PAL) on unit-link (markedsrente) pensions was between -0.1% and -1.8%, down from 2.8% and 9.5% in the comparable year-earlier period. Equities made a loss in the first quarter, while bonds delivered a small positive return.Alternative investments produced a 2.4% return, including a return on real estate of 4%, Sampension said, adding that interest-rate hedging had finally made a profit.Chief executive Hasse Jørgensen said: “We need to create value in the long term for our customers, and our exposure to global equities and emerging markets has recently been an advantage and led to us doing relatively well in comparison with other players.”Exposure to Danish and European shares and weakness in the US dollar helped performance in the first quarter, he said.On the business side, the rise in total contributions was boosted by a 55% rise in transfers-in to DKK249m in the first quarter.Jørgensen said the rise in contributions was very positive and over the fund’s budget.“It is down to extra contributions in company pensions, as well as the result of increases in collective bargaining agreements, which were made last year,” he said.Total assets rose to DKK265.2bn at the end of March from DKK249.6bn at the end of December 2015.Meanwhile, commercial mutual pensions provider AP Pension reported returns of between +0.3% and -0.5% for unit-link pensions in the first quarter, depending on age profile.Ralf Magnussen, investment director at AP Pension, said the pension fund invested globally with an active strategy hedged against currency fluctuations.This combination contributed to AP Pension’s first-quarter returns ranking top against its commercial competitors, he said.“The picture was the opposite in 2015, when we were at the low end, but we stuck to the strategy,” he said.He said this approach was paying off now as it had also done over a longer time period.
The UK Department for Work & Pensions (DWP) has published the new Pension Schemes Bill today, which it said would put important new regulations for master trusts in place and bolster existing laws on exit charges.Richard Harrington, the minister for pensions, said: “We are helping to create a culture of saving across the country and have delivered much-needed change to our pension system to make saving easier, fairer and safer for all.”The publication of the bill was generally welcomed by the industry, though the uncertainty over capital requirements was condemned by at least one provider.Harrington said the government wanted to ensure savers in master trusts had the same protection as everyone else, so it was levelling-up that protection to give them more confidence in their pension schemes. The government department said that, as things stand, there are some workplace pension-scheme members whose savings are at risk from master trusts that fall short of minimum governance standards.The bill, in addition to strengthening pension schemes by making them meet higher operating criteria, will also boost consumer protection on a range of pension matters.The DWP said it would create a new approval regime for master trusts and give The Pensions Regulator (TPR) new powers to intervene where schemes were at risk of failing.Under the proposed new legislation, master trust schemes will have to show they meet five key criteria.They will be required to demonstrate that people involved in the scheme are fit and proper, that the scheme is financially sustainable and that the scheme funder meets certain requirements to provide assurance about their financial situation.In addition to this, the schemes will have to show they have sufficient systems and process requirements to do with their governance and administration, and that they have an adequate continuity strategy, according to the DWP.TPR welcomed the bill, which it said would give it power for the first time to authorise and de-authorise master trusts according to strict authorisation criteria.Andrew Warwick-Thompson, the regulator’s executive director for regulatory policy, said: “We have long called for much stricter controls on master trust schemes and voiced our concerns over the current, very low barriers to market entry.”Joanne Segars, chief executive of the Pensions and Lifetime Savings Association (PLSA), welcomed the bill and said the industry group would now scrutinise it and discuss the planned secondary legislation with the government to make sure it was “proportionate”.“The capital reserving and financial sustainability provisions will require particular scrutiny,” she said.In the bill, read before the House of Lords yesterday and scheduled for general debate on 1 November, provision is made under the section on ‘Financial sustainability requirement’ for TPR to require a master trust or its funder to meet requirements “relating to its financing, such as requirements relating to assets, capital or liquidity”.The PLSA said yesterday it had set up a master trust committee to promote and defend the model of pension provision to the government and regulators.Industry representatives on a panel about auto-enrolment at the PLSA conference in Liverpool gave their initial reactions to the bill, details of which had been published only shortly before.Otto Thoresen, chair of NEST Corporation, gave a cautious welcome to the bill, saying that action was long overdue but at least had now been initiated.The bill does not appear to contain any dramatic surprises, but “the devil is in the detail”, he said, in particular with respect to how the capital requirements are defined and what will count as capital.Emma Douglas, head of DC at Legal & General Investment Management, said some master trusts would be forced to close as a result of the measures, with the regulation being “designed to flush out” those providers that are incapable of operating to the higher standards.She said creating “some fallout” was the regulation’s intention, and that it was key for the industry to co-operate “to provide a safety net” to avoid a “messy fallout”.Patrick Heath-Lay, chief executive at The People’s Pension, also emphasised the importance of avoiding disorderly consolidation, even though the bill is “designed to have a market impact”.He backed the idea of the industry’s coming together to help manage the likely fallout and suggested a panel process could help with this.Other master trusts welcomed the draft legislation.Morten Nilsson, chief executive at ATP subsidiary NOW: Pensions, said that, when his company had entered the auto-enrolment market in the UK, staff were shocked at how easy it was to set up a master trust.“It was simply a case of sending a form off to HMRC and the Pensions Regulator – nothing more,” he said.Since then, Nilsson said the firm had long campaigned for tighter regulation of master trusts to protect savers.But he criticised the lack of a minimum capital requirement for providers entering the market, describing this as a “grave oversight.”He said it was also disappointing that the master trust assurance framework would not be made compulsory as part of the licensing regime.“The voluntary assurance framework,” Nilsson said, “was introduced as a quality standard to enable trustees of master trusts to demonstrate high standards of scheme governance and administration and making it compulsory and building on this existing framework seemed logical.”Kate Smith, head of pensions at Aegon, said the bill would bring governance standards for master trusts much closer to contract-based regulatory standards, which had to be good, she said, not just for employees saving in a master trust but for the pension industry as a whole.But some of the reportedly 100 master trusts in existence might decide the additional costs created by these standards are too great, she said.“This may drive consolidation in the coming year, with members being transferred into stronger schemes that meet the new standards,” Smith said.
At the beginning of this year, VBV switched its biggest Austrian segregated account – the VBV Passive World Equities Fund – to track a low carbon index provided by MSCI, leading to a reduction in carbon intensity equal to the average annual consumption of about 40,000 diesel cars, it said.This change of index cut the fund’s weighting in the carbon-intensive sectors of energy, raw materials, and suppliers.The VBV Passive World Equities Fund has around €850m of assets and about 1,600 individual stocks, and accounts for around 40% of VBV’s total equity portfolio.VBV said the next stage of its strategy was to roll out an environmental management system over the course of this year, across all areas of the pension fund.This would enable VBV “to once more demonstrate its leadership within the sector,” the pension fund said. The €6.3bn Austrian pension fund VBV has cut the carbon dioxide emissions of its investments by 100,000 tons a year by switching the index used as the basis of its main investment.The reduction equates to a 55% contraction in the size of the pension fund’s carbon footprint, VBV said.Guenther Schiendl, board member and CIO at VBV, said: “In the interest of our customers and with our responsibility for the market in mind, we have decided to send out a signal and hope there will be a knock-on effect among the companies we share the market with.”The pension fund said it was shrinking its carbon footprint and focusing on a sustainable decarbonisation strategy in line with the COP21 Paris Agreement.
Sweden’s state pension buffer funds have called four major Nordic banks and Swedish regulators together to decide how to tackle financial crime and money laundering, following a number recent cases involving Nordic banks.AP1, AP2, AP3 and AP4 – as well as the Council on Ethics, which oversees responsible investment policy for the four funds – engaged with Nordea, SEB, Handelsbanken and Swedbank.The council said chief executives from the four banks had agreed at the event that the risk of money laundering had been underestimated in the past and that dialogue between regulators and banks must be improved.Ossian Ekdahl, president of the Council on Ethics, said work against financial crime was a particularly important issue: “We want to have an influence and see that this has been a good step towards dialogue.” Sean Cory, partner at consultancy Oliver Wyman, added that Sweden should follow the example of other countries and explore opportunities for increased information sharing and closer co-operation between banks and authorities. Swedbank has made several senior staff changes following a money laundering scandalParticipants at the seminar agreed that banking secrecy, the principle of public disclosure, and the current framework for reporting of financial and transaction information all needed to be reviewed, the Council on Ethics reported. Co-operation between banks, regulators and criminal investigators was a priority issue, it added.Training of staff, investment in systems and digitisation, and spreading customer knowledge were important tools in the fight against money laundering, the council said. Though the risks had been underestimated before, it said that today, billions had been invested to detect and prevent money laundering.Share price falls for both Swedbank and Danske Bank amid major money-laundering scandals at the banks have hit pension fund portfolio values and dented confidence in the Nordic financial sector in the past two years.Further readingPension funds act as Nordic drama engulfs Swedbank Sweden’s largest pension funds were thrust into leading roles in a money-laundering scandal earlier this year, as Swedbank was raided by fraud investigators and forced to fire its CEOATP: A very Danish scandal Media coverage of a financial scandal in Denmark last year led the resignation of ATP CEO Christian Hyldahl, while the uncovering of unethical behaviour at Danske Bank’s Estonian subsidiary also added to negative perceptions of Danish financial institutions
AXA Investment Managers, BNP Paribas Asset Management, Sycomore Asset Management and Mirova have called for investors to turn their attention to the preservation of the planet’s biodiversity in the same way they have addressed climate change.The group is looking to find a data provider capable, on a large scale, of measuring companies’ biodiversity impact. The asset managers said many tools had been developed over the past few years, but these were largely focussed on climate change.They argued it was equally important to preserve species and ecosystems. Citing a May 2019 report from the Intergovernmental Panel for Biodiversity and Ecosystem Services, the asset managers said one million species were facing extinction.“Biodiversity plays a vital role, and its collapse would jeopardise the future of humanity,” the asset managers said in the statement. “Today, AXA IM, BNP Paribas AM, Mirova, and Sycomore AM are joining forces in order to raise awareness in the financial community and develop the necessary tools for investors to respond to this threat.”Methodology requirementsAccording to the asset managers, the methodology they would like to see developed should adopt a lifecycle approach, factoring in the entire supply chain from product use to “end-of-life”.Another key requirement is that the methodology should be compatible with public taxonomies and internal environmental assessment systems already in use, and the data provided must simplify portfolio performance assessment in relation to an index.The approach must be applicable to companies active in the main market indices, and ideally also compatible with other asset classes such as unlisted equities, infrastructure and real estate.The asset managers also want the methodology to be capable of assessing how exposed companies are to “the challenges presented by biodiversity” in addition to the companies’ impact on biodiversity itself.“We hope the tool we develop will be used by all market players, and that it will become a benchmark tool,” said specialists* at the four different asset managers.The deadline for applications is 31 March.*Julien Foll, responsible investment analyst at AXA IM; Robert-Alexandre Poujade, ESG analyst at BNPP AM, Sarah Maillard, SRI analyst at Mirova, and Jean-Guillaume Péladan, head of environmental investments and research, and portfolio manager at Sycomore AM
“At 1 January 2020, KLP had an inflow of NOK3.5bn and an outflow of NOK7.4bn,” it said, but also mentioned the fact it had recently won the contract for the New Øygarden municipality.The pension provider reported an 8.5% return on capital in value-adjusted terms, and a book return on capital of 4.5%. These figures compare to 1.5% and 3.5% in 2018.Value-adjusted returns, according to KLP’s definition, include unrealised gains or losses from equities and bond investments whereas book returns do not take these changes into account.KLP’s group total assets grew to NOK763bn from NOK676bn at the end of 2018.The company posted a profit of NOK10.9bn for 2019, up from NOK5.7bn in 2018, with NOK10.8bn of this being transferred to the customers’ premium fund – the contents of which can be used for future premium payments.Investments in equities and a rise in the value of bonds and real estate had contributed to the result, KLP said.Chief executive officer Sverre Thornes said the “historically good result” meant KLP could pass on over NOK10bn to the companies, municipalities, counties and health enterprises that were its members.“The result also allows for further strengthening of our financial position,” he said, adding: “We are thus well equipped to operate in turbulent financial markets without our customers noticing it.”This was fighting talk from a company whose near monopoly of the municipal pensions market is also being threatened by the likes of Storebrand and DNB Liv, which have returned to the sector to compete for business after years of absence.On the topic of the new hybrid public sector pension scheme, which has come into effect this year, KLP said this new arrangement was technically demanding to put in place and increased the complexity for its customers and members.“KLP is continuing to invest heavily in solutions to guide both employers and their employees, making it as easy as possible for them to handle their pensions,” it said, adding that advanced systems also provided a foundation for the further streamlining of its own operations. Kommunal Landspensjonskasse (KLP), the dominant provider in Norway’s municipal pensions market, reported it lost NOK3.9bn (€388m) of pensions business in 2019 as a result of the Scandinavian country’s local government reform.The countrywide redrawing of Norway’s administrative regions, which has been underway for the last few years, has seen the number of municipalities reduced to 356 from 428.In some cases where KLP clients have merged with municipalities that run their own pension scheme, smaller local authorities have opted to join a new wider self-administered scheme rather than remain with KLP.In its annual results announcement, the Oslo-based company said: “The municipal and regional reform has so far had only a moderate effect on KLP’s customer base.