The group is responding to a majority of clients who want investments that reflect their values.
Moving deeper into ESG territory and further melding intergenerational family wealth objectives, Stonehage Fleming Investment Management is launching its Global Sustainable Investment Portfolios (GSIP).
The investment arm of the international family office said that the GSIP will largely follow the group’s existing multi-asset investment process but with socially responsible objectives applied. Initial focus will be on equities, fixed income, alternatives and cash, with the main asset allocation and risk-adjusted targets similar to that of the mainstream multi-asset portfolios, which currently manage £7.4 billion.
Additionally, the firm said that any funds which overlap between the new offering and existing portfolios will be limited by tough oversight on selected fund managers.
“The managers we select will pass a high threshold of qualitative and quantitative analysis of both their investment processes and their ESG credentials,” said investment division’s director Mona Shah.
The family office is launching the portfolios largely in response to its own recent research showing that 75 per cent of clients want their values to be reflected in their investments but only 21 per cent are actively taking this approach.
“We see socially responsible investing as a vital expression of our clients’ ‘social capital’,” said Guy Hudson, partner and head of group marketing at the investment firm. “In launching our Global Sustainable Investment Portfolios, we are responding to significantly increased client interest in using their capital to effect positive change in the way companies engage with the environment, communities and their shareholders.”
Chief executive and head of investment, Graham Wainer, said that equities will hold the largest position, but they are also “excited by” opportunities in fixed income, which so far has been largely overlooked by ESG investors, he said. “Bond investors have longer time horizons than their equity peers, and more nuanced relationships with management teams and, critically, with governments. This will be an important asset class for GSIP,” Wainer added.