The $5.7 billion Local Government Superannuation Scheme (LGSS) will appoint an investment analyst to support its CIO, and is preparing to implement the final phase of its global equities restructure.
The chief executive of LGSS, Peter Lambert, said the board had just approved a full-time role supporting CIO Craig Turnbull, and had wound back its advisory relationship with InTech over the past six months to an "as suited" basis.
One task for the investment analyst will be ensuring LGSS meets its responsibilities as a signatory to the UN PRI, as it prepares to expand its in-house ESG screening from Australian equities to all equities.
On the global equities front, LGSS is close to implementing the final phase of its global equity review, which was assisted by InTech, and began last year with Vanguard Investors receiving a 40 per cent slice of the near-$1 billion portfolio to manage passively.
That mandate was funded by terminations of AQR Capital Management and the growth-biased Alliance side of AllianceBernstein, which has suffered heavy institutional losses in Australia after poor performance related to bets on troubled US financial stocks.
Lambert said LGSS would be further reducing its number of active managers, which prior to the latest review phase were BNY Mellon, Marvin & Palmer, Wellington, LSV and a global small cap manager through the Chifley Trust.
"We will choose managers who we are confident can outperform over the short-to-medium term, whose economic outlook for the next three years agrees with our own," Lambert said.
LGSS is currently finalising Investment Management Agreements for the new mandates, and Citi stand ready to perform the transition.
Lambert said LGSS would probably review its relationship with InTech once a subsequent Australian equity review was completed, and the status of the consultant was clearer under its new IOOF/Australian Wealth Management ownership.