Energy Super’s appointment of four new international equities managers has seen the fund move from a pooled investment at AMP Capital as part of its wider diversification strategy.
With the $4.5-billion fund focused on growth, it now has control of its international equities, awarding $700 million in mandates to Harding Loevner, Longview Partners, Sands Capital Management and Schroders.
“We’re of the size that we could do that and that allowed us to be very prescriptive about the strategy we wanted them to manage, as you do with mandates,” said Robyn Petrou, chief executive of Energy Super.
Petrou said the fund’s maturity and ability to maintain the equities mandates means it can be “fairly directive about how we wanted each of those managers to manage our portfolios”.
“When you’re in a fund-of-funds arrangement, it’s a very different level of capability to do that, and we were of the size now that we could actually do that, and add benefits to the members.”
Petrou said the fund has always had international equities, and has kept on one of the managers that AMP was previously utilising.
“It wasn’t necessarily about trying to fix something that was broken. It was about growth and the opportunity for us to develop more specific investment strategies for Energy Super in line with our whole diversification.”
A focus on service delivery
Petrou said it’s been a good year for returns for the public offer fund, which is seeing membership numbers rising.
“Obviously we’ve got a fairly strong growth within the fund and we’ve got cash flows that we need to manage and maintain. We also have a mandate to our members to provide the best level of returns at the right price, and that equates to value for money, and that’s something that Energy Super has always stood for.”
Service delivery has been a major focus for the fund over the last 12 months, said Petrou, on the back of the 2011 merger between ESI Super and SPEC Super to form Energy Super.
“We had new groups of members and two different groups of members that we actually needed to build relationships with and to, I guess, develop our relationships again. Whenever two funds merge, we have the ability to consolidate that.”
Meanwhile, Petrou said the fund wouldn’t rule out future mergers.
“I don’t think any fund could say no to that, and I can’t really comment any more than that. But I would just say that we would always be looking for opportunities, and that part of the trustee mandate is to continue looking out for the members’ best interests.”
AMP Capital has retained Energy Super’s socially responsible investments portfolio.
