The Weekly Wrap: July 13 edition

BT investors show the door to Patterson’s parting pay rise

 FT: A minority of investors in telecoms giant BT have added insult to injury in voting against the reappointment of chief executive Gavin Patterson, despite his sacking having been announced by the company’s chairman in June. At Wednesday’s annual meeting, 3.5 per cent of shareholders rejected the move, which would have awarded Patterson a £1.3m bonus and 2.5 per cent increase to his £1m basic salary, despite falling revenues, profits, and the announcement of 13,000 job cuts. Chairman Jan du Plessis announced his intention to replace Patterson last month.

Pennsylvania state treasurer condemns $5.5bn pension fee ‘waste’

 FTfm: Pennsylvania’s two largest state pension funds have become embroiled in the argument over active and passive fund management, after they were accused of squandering money on expensive Wall Street funds. State treasurer Joseph Torsella said the Pennsylvania Public School Employees’ Retirement System and Pennsylvania State Employees’ Retirement System had wasted $5.5bn (£4.2bn) on poorly performing managers. Similar rows have erupted in Maryland and California, as the US tries to stem a $6tn hole in its defined benefit pension plans.

MP blasts government for ‘stealing’ miners’ pensions

 FTAdviser: Labour MP Dennis Skinner has accused the government of “stealing” surplus in a pension scheme for retired miners. The so-called ‘Beast of Bolsover’ said the Treasury’s policy of splitting surplus in the fund between members and the state was “like Philip Green and Maxwell put together”. Nick Smith, MP for Blaenau Gwent in South Wales, also expressed concerns about the Mineworkers’ Pension Scheme. Responding to the claims, David Lidington, the cabinet office minister, said the government had agreed to guarantee miners’ pensions on the privatisation of British Coal, with any surplus shared between members and the Treasury.

Malaysia’s largest pension fund plans first passive mandate

 Ignites Asia: The RM814.4bn (£152.8bn) Employees Provident Fund is planning to launch its first passively managed mandate, and is prepared to expand its holdings in tracker funds. Malaysia’s largest fund is also expanding the number of specialisations and asset classes in its portfolio, meaning it will likely need to bring in more external managers. Chief executive Shahril Ridza Ridzuan said the foray into passive would be less than RM1bn to start with, but could be expanded if the style of investment suits the fund’s needs.

Swiss pension funds ramp up sustainable investments

 MandateWire: Demand for responsible investment products in Switzerland is rocketing, according to a survey of asset managers and institutional investors in the country. The volume of sustainable investment assets increased by 82 per cent to CHF390.6bn (£295.7bn) in 2017, according to Swiss Sustainable Finance. Although outside the EU, the alpine country is mirroring drives from the European Commission for consistency and clarity on how institutional investors should integrate environmental, social and governance factors into their decision-making process. Public awareness of ESG issues has been raised by Switzerland’s involvement with the Paris climate agreement and the UN’s sustainable development goals.

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Tweet of the week

#BSPS members on stage at #pensiondebate "the Pension was always the carrot, it used to make the shifts, the days and the nights worthwhile" "we were asked to give up that carrot to keep the plant open"..... heart rending.... let down by employer and scammed by a dodgy IFA..

— Andy Boyt (@AndyBoyt) July 11, 2018