Martin Currie Investment Management has formed a partnership for international equities with HESTA, the $52 billion health-and-related-industries super fund. The partnership is to oversee and deliver on a long-term horizon, which is becoming an increasing trend with big pension funds. The deal, announced last Friday (August 28), represents a new mandate with Martin Currie’s Edinburgh-based ‘Global Long-Term Unconstrained’ team.
Under the terms of the agreement, HESTA, which has more than 870,000 members, has appointed Martin Currie to become the underlying investment manager for a new global equities portfolio, which is in addition to the ‘Global Emerging Markets’ portfolio the firm has managed for the fund since 2014. The long-term unconstrained investment team is headed by Zehrid Osmani, who joined Martin Currie in May 2018 from BlackRock, where he had run a series of similarly unconstrained equity portfolios for about ten years. The strategy is designed to provide sustainable long-term outperformance from a high-conviction portfolio, backed by proprietary and systematic fundamental research, Martin Currie said in its announcement.
Central to the partnership is a fee pricing structure based across Martin Currie and HESTA’s full relationship, rather than on each individual investment capability in order to maximise value for HESTA’s member base. HESTA’s investment team also gains full access to Martin Currie’s global investment reach, through research insights and proprietary ESG resources and analyses across global, emerging market and Australian equities. The manager’s pedigree in the ESG space is also important for the mandate, especially with the fund’s concerns about climate change.
Given the volatility of markets, starting with the global financial crisis and currently being driven by the COVID-19 crisis, big funds are expected to increasingly engage in such long-term partnerships with one or more of their service providers, according to Kimon Kouryialas, Martin Currie’s Melbourne-based global co-head of distribution. He said: “We are delighted that HESTA has demonstrated confidence in our international equities capabilities in awarding us this significant mandate. The team at Martin Currie are committed to delivering truly differentiated alpha and research to assist HESTA and its members in achieving their retirement goals”.
Steven Semczyszyn, HESTA’s general manager, growth, said: “We are excited to be entering into this mutually beneficial partnership with Martin Currie. We look forward to working with a like-minded progressive partner like Martin Currie to drive towards better outcomes for HESTA and its members. The partnership will also assist us to achieve our carbon emission targets as part of our ‘Climate Change Transition Plan’.”
Note: Martin Currie is a sponsor of Investor Strategy News. The views expressed, though, are those of the author and may not necessarily be those of Martin Currie.