The People’s Pension has appointed Amundi and Invesco to manage £28bn of the master trusts £32bn of assets.
State Street Global Advisors had previously run the entire portfolio, but this US-based asset manger will now just run the trust’s remaining £4bn of assets.
Amundi — which is Europe’s largest asset manager — will mange £20bn in passive developed market equities, while Invesco will run £8bn in active fixed income investments.
The People’s Pension said these changes to its asset manager were to ensure greater alignment with the master trusts’ stewardship approach.
Last year SSGA was one of a number of US-based asset managers to pull out of Climate Action 100+, an investor-led initiative aimed at getting the world’s largest carbon emitters to reduce emissions and take action on climate change. This comes amid a widening gulf between US and European regulations around sustainability and ESG issues.
The passive equity portfolio awarded to Amundi consists of five regional sleeves covering major developed markets and will continue to include climate-focused indices aligned with The People’s Pension’s responsible investment policy.
The People’s Pension said that when selecting new asset managers the master trust was looking for excellence across six key factors: portfolio construction, people and teams, risk management and systems, firmwide considerations, responsible investment and partnership capabilities.
The fixed income mandate awarded to Invesco spans sovereign bonds, investment-grade credit, and high-yield bonds across the UK, US, Europe and Emerging Markets.
The appointment meets The People’s Pension’s requirement for a manager that can serve as a long-term strategic partner, with experience across a range of sub-asset classes as well as being capable of delivering superior returns for members with strong access to markets. TPP says this is particularly important given the scale at which the scheme operates.
The mandate also incorporates defined maturity buckets, allowing for greater precision in managing risk and liquidity. Invesco’s approach will feature net zero alignment alongside environmental, social, and governance (ESG) analysis and active engagement with issuers to promote sustainable business practices while delivering robust long-term returns.
This move follows the recent transition of £28 billion of assets into segregated mandates held by the Scheme’s custodian, Northern Trust, providing The People’s Pension with greater control, transparency, and flexibility in its investment approach.
The People’s Partnership chief investment officer Dan Mikulskis says: “The appointments of Amundi and Invesco are the culmination of months of work for our team, signalling a major evolution for The People’s Pension as we continue to grow and enhance our investment strategy.
“ As one of the fastest growing asset owners in the UK, we have a responsibility to deliver strong, sustainable returns for our members and a best-in-class investment strategy. Both managers bring exceptional expertise and share our commitment to responsible investment, which is central to our approach.”
The People’s Pension chair of trustees Mark Condron adds: “Our move to segregated mandates alongside partnering with world-class asset managers demonstrates our ongoing commitment to being a leading force for positive member outcomes in the pensions industry.
“These appointments highlight The People’s Pension’s broader mission to balance strong financial performance with responsible investment principles. By selecting Amundi and Invesco, we have chosen to prioritise sustainability, active stewardship, and long-term value creation for our near seven million members.”
Amundi chief executive officer Valérie Baudson says: “As retirement regimes in the UK and across the globe continue to evolve, this partnership highlights Amundi’s capabilities in the fast-growing DC market.”
