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Schroders to take responsibility for Friends Life multi asset and equity portfolios



Friends Life has announced that Schroders will assume responsibility for £12.2 billion Friend Life’s multi asset and equity portfolios, replacing Friend Life’s current provider F&C Asset Management.

The assets will be transferred to Schroders from the fourth quarter of this year. Mike Dobson, chief executive of Schroders, said the partnership represented an important step in the company’s development of its multi asset business as well as bringing new assets to a number of capacity unconstrained equity strategies.

Andy Briggs, group chief executive at Friends Life, said, “Schroders has excellent credentials across the investment spectrum, generating superior outcomes in equity and multi asset management. Importantly, our two organisations share a commitment to innovation and putting customer needs first.”

Friends Life also announced that from the fourth quarter of 2014 Friends Life Investment (FLI) will take responsibility for a further £2.3 billion of Friends Life’s sterling fixed income assets, again replacing F&C. This will bring the value of assets FLI has brought in-house, since its launch in 2012, to over £20 billion.

Commenting on the announcement, Mark Hoskin, financial adviser and partner at London based Holden & Partners, said, “This is a major change. Schroders have not to my knowledge ever run an ethically screened portfolio. There has not been any information relating to how the stewardship funds will be managed by Schroders. I hope that this loss in asset base does not impact on the offering F&C are able to maintain in the ethical market.”

Julian Parrott, financial adviser at Edinburgh-based Ethical Futures, also echoed these concerns. He said, “We are watching these developments with interest and some concern on both the Friends Life and F&C fronts.

Schroders has no demonstrable track record in management of ethically screened funds and the expertise behind the application of the Stewardship policy actually lies within the governance team at F&C – not in Friends Life.”

Photo: Friends Life via Flickr

Further reading:

Report criticises pension providers over responsible investment

The days of investors being unaware of ethical investment options are behind us

F&C: responsible investment ‘continues to gather momentum’

Behind the Fund: Schroder Global Climate Change Fund

The Guide to Sustainable Funds 2013