AMP MyNorth has announced a number of enhancements to its sustainable managed portfolios amid strong demand from advisers for value-aligned investment options.
Launched in 2020, the portfolios are multimanager, multi-asset portfolios constructed using a responsible and sustainable framework based on three objectives. These are: the transition to a low carbon environment; avoiding material investments in industries which may cause harm; and encouraging positive sustainable, social and environmental outcomes.
As a core environmental, social and governance (ESG) principle, the portfolios invest in funds where managers influence the companies they invest in with respect to ESG matters.
According to AMP, the new enhancements aim to improve North’s sustainability footprint following a periodic review of the portfolios in the September quarter.
They have seen a reduced allocation to alternatives across all three MyNorth risk profiles by between 6–8 per cent, with that allocation equally distributed between equities and Australian fixed income, while maintaining a consistent allocation to growth and defensive assets within each portfolio.
AMP also confirmed several manager changes, divesting the Vanguard Ethically Conscious International Shares (Unhedged) Fund, reducing exposure to the Impax Sustainable Leaders Fund and allocating that equally across AXA IM Sustainable Equity Fund, Janus Henderson Global Sustainable Fund and Dimensional Global Sustainability Trust.
Each of these funds has been carefully considered to align with MyNorth portfolios’ sustainability principles and objectives, AMP said, and bring specific investment traits to the portfolio (either style or cap bias), increasing the overall diversification.
Additionally, management fees have been lowered for all options, with a reduction of at least five basis points across the three portfolios.
“We know there is strong demand from advisers and their clients for sustainable and ethics driven investment options, with research showing responsible investment now accounts for over one-third of the investment market in Australia,” noted David Hutchison, AMP’s general manager of managed portfolios and investments.
“At North, we’re constantly looking at ways to innovate with a modern digital offering that provides advisers with a broad investment menu to suit advisers with wide ranging investor needs – particularly those seeking investment options that can deliver sustainable outcomes over the long term.”
He also highlighted rapid growth in the managed portfolio market, attributed to its numerous governance, cost, transparency and administrative benefits.
“AMP’s total managed portfolio assets under management has increased nearly tenfold in the space of four years, rising from $2 billion to $17.9 billion in the last quarter and continuing to grow in Q4,” he said.
Earlier this year, the Responsible Investment Association Australasia’s (RIAA) biannual report found more Australians are prioritising responsible investment. Some 88 per cent expect their super or other investments to be invested responsibly and ethically, up from 83 per cent in 2022.
Edwina Maloney, AMP group executive for platforms, noted North was one of the first wrap platforms to offer sustainable managed portfolios in Australia, providing advisers and their clients with more investment options aligned with their values without compromising performance.
“We’re pleased to continue that tradition by enhancing our MyNorth Sustainable range to deliver greater diversification benefits and improved, sustainable outcomes for our members,” she said.
“Our rapid growth over the past 12 months reflects the investments we’ve made to the platform, including technology upgrades and continuing to expand our managed portfolio range which is the fastest growing in the market.
“We know advisers value choice and flexibility while keeping fees low for their clients, and we’ve made these latest changes to improve our MyNorth sustainable managed portfolios’ investment and sustainability characteristics.”
She signalled AMP would continue to target enhancements for North over various aspects in the coming months, including better retirement solutions, improvement investment choice, ease of administration and value for money.
Earlier this month, AMP also launched household consolidated reporting across multiple clients to North Interactive in response to adviser feedback, enabling a more comprehensive view of clients’ financial situation with reporting across multiple client accounts in the same report.
