AXA Investment Managers is growing its responsible investment fund offering and expanding its team covering the sector, in anticipation of growing demand from Australia investors for Asia-based responsible funds.

The global investment manager recently hired Matt Christensen to the role of global head of responsible investment with the mandate to further develop AXA IM's RI capabilities. Christensen previously held the position of founding executive director of Eurosif, a European think tank on RI issues, since 2002. 

The firm is eyeing the sector after estimates that demand for RI fund will triple over the coming three years, with Asia playing a key role in the ongoing global RI evolution.

Christensen said Asia was poised to be the next growth market with Australia’s A$1.3 trillion superannuation funds sector a key driver. However he warned that Australian institutions investing in Asia face a raft of new corporate governance challenges given the particular cultural, regulatory and transparency characteristics of companies operating across various Asian markets.

“Undoubtedly Asia represents a unique investment opportunity, but global investors should abandon the box-ticking approach based on the application of a single set of corporate governance rules, and instead encourage Asian companies to embrace the spirit of good principles of corporate governance as their companies and economies evolve,” said Christensen.

AXA IM today also announced its six existing RI funds had received a stamp of approval from independent expert Deloitte after engaging the funds in an in-depth external audit.

Craig Hurt, Sydney-based director of AXA Investment Managers in Australia & New Zealand, said the lack of globally recognised and shared RI standards meant investors were not currently being offered full transparency around RI issues.

“Our Australian clients – like their global counterparts – are concerned more than ever about investing in companies that have exemplary corporate governance and take into account social and environmental factors in the development of their activities,” he added.

Responsible investing is one of the fastest growing global investment trends with global funds invested in RI strategies tripling from $3.6 trillion in 2006 to $11 trillion in 2010 according to Eurosif.

Christensen said the key market driver in the coming three years would be demand from institutional investors, along with international initiatives such as UNPRI, external pressures from entities such as NGOs and unions, regulatory pressures, and demand from retail investors.