Skandia Investment Management, the asset management arm of Skandia Group, is to launch a multi-manager ethical fund, offering investors a lower-risk, well diversified alternative to the single manager funds which dominate the sector.
The Skandia Investment Management Ethical Fund will utilise both the manager of managers and fund of funds approaches in order to generate outperformance while minimising the risks and volatility associated with many single manager and single country ethical funds.
The fund will be managed by four leading fund management houses. JPMorgan Asset Management will manage a segregated mandate while the balance will be invested in three leading retail funds: F&C Stewardship Growth, Aegon Ethical and Norwich UK Ethical (Morley).
The screening criteria applied to the Skandia Investment Management Ethical Fund will be among one of the strictest available and will apply to the whole portfolio. The criteria will be under constant review and, if necessary, will be altered to reflect changing circumstances and emerging concerns.
Companies that will be screened out include those involved in animal testing, detrimental environmental activities, countries with poor human rights records, armaments, gambling, pornography, alcohol and tobacco. Companies will be favoured if they have good records in employee relations, social issues and environmental management, products and services.
SIM chief executive Jamie MacLeod says: "Some ethical funds can be volatile and this has been a concern for IFAs and their clients. The Skandia Investment Management Ethical Fund will seek to address this issue by diversifying the portfolio internationally and across managers.
"The four groups selected to run the fund have been chosen not only on the basis that they are among the leading managers in their fields, but also because they offer complementary investment approaches. We believe the fund is ideal for risk-aware UK investors who have real ethical concerns."
Source: Skandia Group