Nest announces new thematic approach to investing in listed companies and appoints Lombard Odier as manager

29 February 2024

• Mandate awarded to Lombard Odier Investment Managers
• Around £5bn to be invested in the fund by 2030

Nest, the pension scheme representing a third of the UK workforce and £36bn worth of assets, has today confirmed the appointment of Lombard Odier Investment Managers (LOIM) to manage a new thematic equity mandate.

Nest currently has around half its portfolio (50.4%) invested in listed equity funds, managed in a way to achieve alignment with a transition to net zero by 2050. The UK pension scheme now also wants to invest actively in key themes such as climate change mitigation and adaptation, natural capital and social issues, that should provide further investment growth opportunities across its investment portfolio.

Following a robust procurement, in which 29 fund managers applied, LOIM has been appointed to manage this multi-thematic equity fund, mainly across developed markets. Nest estimates to have around £5bn invested in this LOIM fund by the end of the decade.

Commenting on the appointment, Liz Fernando, Nest’s CIO, said: “As Nest expands and our investment in listed companies grows to £50bn and beyond, we want to enhance our ability to drive future returns for our members.

“These are key themes we can proactively manage which should be rewarded by financial markets as disclosure on these topics improve, and technological, regulatory, and structural economic shifts drive future growth in these areas. We want to be investing in companies at the forefront of this transformational change.

“Lombard Odier was the standout candidate in the procurement process, demonstrating they can take a dynamic approach to portfolio construction. They have robust sustainability research capabilities, accompanied with a strong investment process and governance, that gives us every confidence this will be a hugely successful partnership.”

Jasbir Nizar, UK CEO and Global Head of Business Development at LOIM, said: “At Lombard Odier Investment Managers, we believe that system changes resulting from the sustainability transition will result in profound changes in business models, in value chains and in the organisation of our economy.

“We have invested significantly in our resources and partnerships to create cutting-edge roadmap research that translate these system changes into investment strategy, working seamlessly with our well-established active equities team.

“We are delighted that Nest has chosen to partner with LOIM, in recognition of our expertise and credentials in sustainable investing. We look forward to helping Nest members navigate risks and identify the investment opportunities that are emerging from this transition.”

Source: Nest