Global manager’s SA offering expands as investors look for sustainable options and access to Asian markets
New Hires and Leadership in South Africa
Schroders have announce that, after four years of leading the business in South Africa, Doug Abbott will be returning to the UK to take up a new role at the firm as co-head of UK Intermediary. Kondi Nkosi, who joined Schroders in 2018, will take on the role of Country Head – South Africa after Abbott’s departure at the end of Q1 2020.
“After four years setting up our operations in South Africa, I am very pleased that Kondi will lead the business when I return to the UK at the end of March next year. Schroders is one of the few global managers operating in South Africa and we are committed to the market here. We will continue to bring our offshore strategies to the South African investment landscape, with a focus on building and maintaining strong relationships with investors,” says Abbott.
The Schroders South Africa (SA) team continues to develop, with Ebeth Van Heerden having joined in Johannesburg in September this year as a business development manager. Van Heerden is responsible for advisor and platform relationships. Nkosi’s SA team will be further bolstered from December 2019 by the addition of a sales support person who will focused on supporting the local client servicing team. The firm also expects to fill a business development role in Cape Town with a further hire in 2020.
“I am delighted to be taking over the leadership of a growing Schroders South Africa team at this interesting time in our markets. As a truly global, multi-capability offshore investment manager, we are committed to assisting South African investors meet their investment objectives with solutions that are complementary to their current onshore allocations,” says Nkosi.
New fund approvals
Abbott goes on to say that in addition to their commitment to local client servicing through a growing SA team, the FSCA has recently approved four more funds to offer to the South African market: “the new approvals ensure that we can offer South African investors a comprehensive range of offshore investment options”.
Schroder ISF Sustainable Growth
The Global Sustainable Growth Fund invests in a concentrated, unconstrained global growth portfolio of 30-50 sustainable companies seeking to deliver outsized long-term returns. The fund has been running since November 2010 and follows a strict sustainability focused process that excludes stocks with material exposure to alcohol, tobacco, controversial and conventional weapons, gambling, adult entertainment, industries negatively impacting climate change (tar sands and thermal coal), high interest rate lending and human embryonic cloning.
Abbott notes that the approval of the Schroder ISF Global Sustainable Growth Fund will allow local investors to invest their offshore investments in a dedicated fund focused on companies with strong ESG credentials.
“From our Schroders Global Investor Study 2019, we noted that South African investors have a particularly heightened awareness of sustainability. In fact, almost 70% of investors feel they can significantly contribute to a more sustainable world by choosing sustainable investments, with 61% of them saying they always consider sustainability factors when selecting an investment product. The approval of this fund gives investors a global fund to invest in focused on companies which are sustainable in nature”
Schroder ISF Asian Equity Yield and Schroder ISF All China
The Schroder ISF Asian Equity Yield Fund aims to provide income and capital growth by investing in equities of Asia Pacific companies (excluding Japan). The Schroder ISF All China Fund invests in Chinese companies irrespective of where they are listed i.e. onshore and offshore China. Importantly, Abbott says that both funds are able to invest in the onshore China market
“These two new funds will give South African investors access to investing in companies listed in the growing economies of Asia. South African investors tend to invest in global funds which are benchmarked to the MSCI World, which excludes emerging markets. This means that they often miss out on the growth opportunities in Asian markets. Investing in these markets, however, requires a well-resourced and experienced team on the ground and specialist investment capability, which is essentially what these new funds are offering.”
China A Shares, in particular, are often under-represented in investors’ portfolios, given the size of its asset markets and economy, notes Abbott. “The All China Fund is therefore very exciting, as it offers exposure to both Chinese companies listed offshore and those listed inside China – the A Share market. The strategy is designed to offer investors a one-stop exposure to Chinese companies with oversight from an experienced and well-resourced investment team based in Shanghai and Hong Kong.”
Schroder ISF USD Liquidity
The Schroder ISF USD Liquidity fund is designed to provide liquidity and aims to preserve client investment value, particularly in falling markets.
“Our clients across the institutional and retail segments have expressed an interest in a money market solution for their USD denominated cash holdings in offshore accounts. Our USD Liquidity Fund serves to meet these needs by investing in high quality, short term money market instruments denominated in US Dollars,” says Abbott.
List of FSCA Approved Funds
Schroder ISF Global Recovery
Schroder ISF QEP Global Core
Schroder ISF Global Equity Alpha
Schroder ISF Global Smaller Companies
Schroder ISF Asian Equity Yield*
Schroder ISF All China *
Schroder ISF Global Sustainable Growth*
Schroder ISF USD Liquidity*
*new fund approval.