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The $13 billion Cbus is looking to gradually increase the amount of risk within its portfolio, hiking its alloca­tion to equities over the next six to 12 months. Trish Donohue, investment man­ager at Cbus, said the fund had not yet reallocated the money redeemed from the international equities mandate terminated with AllianceBernstein earlier this year, however in line with its strategy it would be looking to “gradu­ally increase exposure to equities over the next six to 12 months”.  Cbus moved to a more defensive position in the lead up to the global fi­nancial crisis, increasing its allocation to cash and underweighting its allocations to equities.  

The asset allocation of the fund’s Core Strategy Option, which claims around 92 per cent of members, is: 46 per cent equities, 14 per cent infrastruc­ture, 17 per cent property, 9 per cent private equity, 5 per cent fixed interest, 6 per cent cash and 3 per cent other alternatives. “Looking forward, we are moving to take on a little more risk in the portfolio through allocation to equities,” Dono­hue said.  “This will be done in a measured way based on our medium term outlook for the investment markets.” The fund is also reviewing opportu­nities in the credit markets, with a focus on investment grade credit, however Donohue said the fund had not made any direct allocations.  

Having initially prioritised listed equities and property, Cbus is “steadily working on ESG integration for other asset classes, particularly infrastructure and private equity,” Donohue said. The fund hired former Industry Funds Management sustainability man­ager Louise Davidson as ESG invest­ment manager earlier this year.  

Cbus is a foundation member of the Australian Council of Super Inves­tors (ACSI), a signatory to the United Nations Principles for Responsible Investment (UN PRI) and the Investor Group on Climate Change. Through the Investor Group on Climate Change, Cbus is broadening its understanding of the impact of climate change on its investments, and looking at opportunities for investors in the “inevitable transition of the economy toward a low-carbon basis”, Donohue added.

 

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