Engineered equities will be a key offering from Northern Trust’s newly announced asset management sales and client service team office based in Melbourne.
Such offerings will be factor driven with custom benchmarked design and implementation. Steve Potter, president of Northern Trust Asset Management, said the team will assess a fund’s portfolio to find where unintended risks have been taken across their different managers and/or where more risks should be taken in certain factors such as quality, low volatility, small cap and value.
“We do know from our early days that the market is strongly interested in our engineered equities solutions and there’s a growing trend towards passive. We have developed a very strong expertise in ESG (environmental, social and governance) screens in particular, including ESG as a factor in engineered equity type products, which is resonating with superannuation funds and other institutional investors,” Potter said.
One client in the region has already developed a partnership with Northern Trust, according to Potter.
“I would call it a partnership because they’ve allowed us to work collaboratively on really looking at the ESG factors, and looking at ways to bring quality and ESG together to create and interesting product to add value over the index,” he said.
Two other funds have scheduled meetings to visit Northern Trust’s offices in America as part of a “knowledge transfer” on managers.
Another “core” part of Northern Trust’s delivery to super funds will be drawing on Patrick Groenendijk’s thought leadership around effective program governance. Groenendijk was the chief investment officer of Pensioenfonds Vervoers, a €20 billion pension fund in Europe, before moving across to Northern Trust to the position of senior client investment officer.
To support Northern Trust Asset Management’s expansion across Australia, it has appointed two sales representatives, Shane Teunissen and Ann-Marie Garry who will be reporting to Bert Rebelo, head of business development for Northern Trust Asset Management in Australia and New Zealand.