Despite being a growing reservoir of funds under management, this critically important pool of capital is confronting mounting problems collating and disseminating key data in a timely manner.
The ratings house is pinning its growth strategy on a revamped methodology that increases the emphasis on governance to 25 per cent – a timely move considering APRA’s proposed reforms.
ANU appoints NAS as its first custodian
(pictured: John Comito)
The Australian National University’s endowment fund, which famously sparked a national debate in 2014 with its decision to wind down investments in fossil fuel stocks, has appointed its first custodian after a tender process.
NAB Asset Servicing (NAS) was awarded the job which will provide master custody services to the $1.3 billion fund, allowing better information and control over fund managers’ allocations and transactions as well as any internal investment decisions.
Interestingly, this includes potential access to NAS’s new “look-through” service which follows a partnership with Sustainalytics, the global research firm that recently opened an Australian office, for information on the underlying stocks held by managed funds, including the ability for clients to get a total view on their carbon intensity.
The endowment portfolio includes self-managed investments and the appointment of a custodian will allow for the more efficient oversight of these trades and settlements. With investments in unit trusts, funds without their own custodian rely on whatever custody arrangements the individual managers have.
The win for NAS, even though a small fund, is possibly the most significant since John Comito took over the role heading up the custody business this April. As its first custodian NAS will be under the spotlight at the high-profile fund.
While the ANU’s 2014 decision for partial, or gradual, divestment of fossil fuel investments sparked wider debate, the internal debate on the issue continues. The “Fossil Free ANU” group formed at the time most recently welcomed the progress but said it had not yet gone far enough.
Brian Schmidt, the ANU vice chancellor, announced in April this year that the ANU would “weight the portfolio to reduce carbon intensity… to ensure that it is at least 25 per cent lower than the ASX 200′”.
He said: ‘The university will continue to evaluate the methods available to simultaneously meet its obligations to achieve a high and stable return on its investment portfolio and decrease its CO2 intensity.”
Fossil Free Spokesperson, Luke Kemp, welcomed the move but stressed that “as with the ANU’s partial divestment in 2014, it is not enough”.
Meanwhile, NAS has also retained two important super fund clients after reviews. They are Statewide, in South Australia, and Equip Super.
– Greg Bright
