US institutional investors are discouraged to diversify into offshore shares due to the outcome of a court case which restricts anti-fraud protection. The US case involving the purchase of shares in an Australian bank by Australian investors on an Australian stock exchange has important implications for US institutional investors and their drive to diversify investments offshore, a paper finds. A white paper commissioned by the Council of Institutional Investors (CII) to examine the impact on institutional investors of the 2010 case, Morrison v National Australia Bank, was released this week. [...]

Allocations to alternative investments of the largest seven pension markets globally (P7) have increased by 15 per cent over the past 16 years, according to Towers Watson. Carl Hess, Towers Watson’s global head of investment, says the study reflects two investment themes in the past few years: globalisation and diversification. While alternatives have increased as part of this diversification trend, in part he says, the increase has also been due to “packaging and mainstreaming” of the products. The average asset allocation to alternatives has increased from 5 to 20 per [...]

The most sustainable 100 companies in the world, as measured by Corporate Knights, outperformed the MSCI by 12.4 per cent since the list’s inception in February 2005, it was announced at Davos last week. From February 1, 2005, to December 31, 2011, the “Global 100 Most Sustainable Corporations” list has achieved a total return of 41.7 per cent, outperforming the MSCI All Country World Index, which returned 29.30 per cent over the same time period. The list is compiled by assessing 11 key performance indicators (listed below) including linking senior [...]

A strong financial services sector is an integral part of solving the world’s “real challenges” of unemployment, poverty and global imbalances Josef Ackermann, chief executive of Deutsche Bank and chair of the financial services governor’s group at the World Economic Forum, says. Speaking at the 2102 annual meeting in Davos last week, Ackermann, says “we need to stop the blame game and start looking forward”. Pointing to Spain’s 42 per cent youth unemployment, he says a strong financial services sector is needed to support the type of recovery that is [...]

A pay-for-performance measure of chief investment officers in the US has revealed paying more for an executive does not translate to better performance. Developed by executive recruitment firm, Charles Skorina & Company, the index is calculated by assessing an institution’s investment returns over the past five years, and measuring it against the salary of the CIO. A basis points earned per $100,000 of compensation is derived and then the CIO’s are ranked by this measure of “performance for pay”. By this calculation, John Hull, chief investment officer of the Andrew [...]

The remuneration of pension fund investment executives is a sticking point in the industry. To compete with the open market, attract and retain a certain calibre of executive, and compensate them for the peculiarities of being a fiduciary, there is a certain minimum required. At the same time this has to be balanced with communication to beneficiaries, governments and other stakeholders about what is fair, often within tight budget constraints. Communicating what is value for money, and developing appropriate pay structures as part of this measurement is a challenge. The [...]

A practical guide to good governance for pension board trustees was one of the results of the Rotman ICPM Board Effectiveness Program which included participants from 21 funds from nine countries.

Investments in credit will be a hive of activity this year as the role of banks in lending continues to fall and investors make decisions about the place of sovereign debt in their portfolios, according to Mercer. The consultant, which has outlined economic and financial challenges for investors in 2012, says the scarcity of credit, as well as the reduced role of banks in lending, provides possibilities for investors to build and broaden credit portfolios. Further, it says that investors need to make some “sharp judgments” on sovereign bond investing, [...]

The defined contribution-dominated Australian superannuation market could do well to borrow the investment philosophy of its defined benefit cousins to better accommodate an individually-targeted retirement income strategy, a new paper finds.

IMQubator, the emerging manager fund of funds backed by APG, will establish an international capital introduction network, as part of a plan to attract institutional investors in addition to the Dutch giant.

The formal approval of the Green Climate Fund (GCF) was a critical outcome of the UN climate change conference in Durban, according to Deutsche Bank Climate Change Advisors, but the lack of funding for the GCF remains a concern.

Investment controls and systems remain the highest risk at CalPERS according to its year-end enterprise risk dashboard.