Ben Dear
Ben Dear is starting to see his vision for Osmosis Investment Management become a reality, with traction in Europe and the U.S., and an Asia-Pacific distribution deal under his belt.
It's been a long time coming. The CEO started the firm in 2009, with the aim of bringing positive environmental impact and sustainable investment to the mainstream — without compromising portfolio performance.
The London-headquartered team managed $14.1 billion in sustainable quantitative equities as of June 23, with clients including the €28.8 billion ($32.3 billion) Pensioenfonds PGB, Amstelveen, Netherlands, which in February said it was allocating about $4.5 billion to an Osmosis resource efficiency strategy.
Under the latest distribution deal, announced July 7, the $209.4 billion Nikko Asset Management entered a non-binding agreement with the intention of taking an undisclosed, minority stake in the sustainable equities boutique. Nikko also gained exclusive distribution rights in the Asia-Pacific region for Osmosis investment products and strategies.
The firms have been speaking for about a year, Mr. Dear said in an interview from Singapore, where he is midway through an APAC roadshow linked to Nikko and the deal.
"Asia is a huge part of the pie in terms of opportunity," he said. "The environment is a global issue, investors invest on a global basis, and best-of-breed funds should be marketed globally. But Asia is always a challenge for London-based managers," mainly because of language barriers, Mr. Dear said.
Then, last week, Sumitomo Mitsui Trust Asset Management said it had entered into a non-binding agreement with Osmosis to develop new products and strategies together, as well as a non-binding agreement to prepare to acquire a minority stake in Osmosis.
Nikko and SuMi TRUST would join Oxford Endowment Fund, Oxford, England, a £6 billion ($7.9 billion) fund that has held a minority equity interest in Osmosis since 2012, and U.S.-based sustainable investment manager Capricorn Investment Group, with $9 billion in assets under management, whose Capricorn Sustainable Investors Fund made an equity investment in 2020.
Overall, Mr. Dear knows there's more work for Osmosis before he realizes his ambition of being "synonymous with sustainable investing and better risk-adjusted returns." The aim is to scale across assets.
"We still have to go out and … we have to fight for every dollar. And it has to be based upon the efficacy of the investment process, rather than the brand above the door. That's the difference we're trying to make," he said.
And he plans on being around for the long term. Referring to a PricewaterhouseCoopers report last week predicting that 1 in 6 money managers will disappear in the next five years, Mr. Dear said: "I'm not going to be one of those. That's ambition No. 1."
The second focus is to take hold of "an opportunity for a responsible investment manager that acts responsible, to truly scale a global brand. And if you don't have ambition, and shoot for that, then you shouldn't really be in the industry. Certainly, as a chief executive, if you don't have those kinds of ambitions, you shouldn't be running … a boutique seeking to scale," Mr. Dear said.
He also wants to "disrupt the market slightly," he said — unsurprising since his background is in technology and he's also set up firms before.
"Ultimately for a lot of thematic products, I think the end-investor, ie: the unit holder, gets a very raw deal. The products can be very expensive, they often fail to deliver, managers launch them at the peak of the hype, so the investor doesn't enjoy the return," Mr. Dear added. "None of that is responsible, in my opinion. So, putting the interests of the unit holder, before the interest of the shareholder, will lead to better outcomes for both."
