WORLD BRIEFS: Canada Pension Plan targets governance, environment

TORONTO — Canada Pension Plan Investment Board issued a new policy on responsible investing that aims to shift more focus on corporate governance and environmental issues. The C$87 billion (US$74 billion) fund will join investment coalitions such as the Canadian Coalition for Good Governance and participate in institutional investor summits on climate control that focus on corporate governance, human rights and the environment; monitor proxy votes by money managers and affiliated shareholders; draft shareholder proposals to companies in which it invests; and directly engage companies on their environmental policies and corporate governance. The fund will not screen for socially responsible investments.

Additionally, the fund is examining new initiatives, which include helping create an investor group sponsored by the United Nations that would develop principles of responsible investing and helping form an investor network on climate risk.

LINCOLNSHIRE, Ill. — Most global employers lack control over their retirement benefits, according to a report released by Hewitt Associates. Hewitt, which surveyed more than 100 companies in Europe and North America, found that 64% do not have annual goals for their retirement plans and 60% lack written global strategies, confirmed spokeswoman Kelly Zitlow.

Hewitt identified six "dimensions of control": managing costs, minimizing risks, optimizing processes, aligning pension goals with business strategies, enabling employees and executing the pension strategy globally.

LONDON — U.K. balanced pooled pension funds returned a median 8% in the third quarter, the 10th consecutive quarter of positive returns, according to a study by Mellon Analytical Solutions. Active U.K. equity managers had a median return of 7.9% for the quarter, just below the FTSE All-Share index return of 8.2%. U.K. small-cap and midcap stocks both returned 8.7% in the third quarter, while U.K. large-cap stocks returned 8.1%.

"Continued strong equity performance in (the third quarter) means that balanced pooled funds have finally broken even over cumulative periods from the start of the decade," Daniel Hall, Mellon Analytical Solutions' publications and statistics manager, said in a statement.

LONDON — Europe-domiciled retail and institutional mutual funds had record net inflows of €250 billion ($305.975 billion) for the eight months through Aug. 31, taking the lion's share of more than €400 billion in worldwide inflows for that period, Jag Alexeyev, senior managing director of Strategic Insight Global, said in an interview. Net inflows for U.S. domiciled mutual funds were $170 billion for the same period.

Fewer than 1% of funds globally accounted for half of net flows, according to a news release. There were signs, however, that flows in Europe have been less concentrated than in the United States, where a handful of fund families, led by American Funds and Vanguard, have snared more than 50% of net flows. More than 50 fund management companies in Europe have "captured in excess of a billion euros in net flows this year," while many coming in below that hurdle still had "meaningful gains," Mr. Alexeyev noted in the release.

HEERLEN, Netherlands — Stichting Pensioenfonds ABP returned 10.8% on its investments, or €18.8 billion ($22.45 billion), for the first nine months of 2005, nearly half of which came in the third quarter, according to a statement from the €187 billion pension fund. ABP posted €8.6 billion of the investment return during the third quarter. ABP had €156.1 billion in liabilities as of Sept. 30, an increase of €1.7 billion during the quarter and an increase of €17.5 billion since the beginning of the year. Third-quarter performance benefited from steady interest rates vs. higher volatility in the first half of the year, the statement said.

MELBOURNE — National Australia Bank will begin offering commission recapture services to custody clients in Australia and New Zealand through a marketing alliance with Bank of New York's Lynch, Jones & Ryan subsidiary, confirmed Kevin Heine, a Bank of New York spokesman.

"The commission recapture services that we can now make available through LJR will enable our clients to enhance their own capabilities and performance," Peter Kempster, general manager of National Australia Bank's National Custodian Services, said in a news release.

National Custodian Services provides custody and investment administration services and had A$350 billion (US$263.5 billion) assets under custody and administration as of Dec. 31.