Stichting Pensioenfonds ABP is the first investor in an active emerging markets equity portfolio managed by Rexiter Capital Management Ltd., overlaid with a sustainability screen provided by Innovest Strategic Value Advisors Inc., New York.
Rexiter and Innovest are partially owned by State Street Global Alliance LLC, Boston, which is jointly owned by State Street Global Advisors and the €150 billion ($184 billion) ABP pension fund, Heerlen, the Netherlands. ABP invested €10 million, said Matthew Kiernan, Innovest founder and chief executive. An ABP spokesman couldn't be reached for comment.
The strategy is based on the inefficiency of the emerging markets, said Mr Kiernan. "Financial information is hard to come by," he said. "So if you roll up your sleeves, you can get good returns."
Rexiter will first select stocks based on its fundamental approach, and then use the Innovest screen — which measures the quality of a company's operations and management — to come up with about 70 stocks for the portfolio, said Murray Davey, Rexiter director. Innovest ranks companies on sustainability issues such as labor, environmental and corporate governance issues, selecting those that are likely to perform better based on that criteria.