St James’s Place hands £5.2bn fund to Schroders in blow to Impax

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Wealth manager St James’s Place has handed a £5.2bn fund to Schroders after ousting investment manager Impax, which sent shares in the sustainable fund group tumbling.

SJP, the UK’s largest advisory group, will give the Sustainable and Responsible Equity fund to Schroders to run from next month, having dumped Impax at the end of last year.

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The decision by SJP, which manages £185bn in assets, sent shares in Impax plunging by more than a fifth immediately after it was axed in December.

SJP said that it regularly monitors the performance and strategy of the external fund managers it uses to help run its clients’ money.

The Gloucestershire-based FTSE 100 wealth manager said the change will mean fees will also drop, though by just 0.01 per cent.

The decision comes after a difficult year for Impax, in which its shares have tumbled nearly 60 per cent, while assets under management fell by 8 per cent over the past quarter. The asset manager has also grappled with short sellers, including hedge fund GLG Partners betting against its stock.

SJP said the fund has also received a special label, Sustainability Focus, from the Financial Conduct Authority, which is aimed at helping investors searching for funds with their ESG goals.

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Justin Onuekwusi, chief investment officer at St James’s Place, said the label and appointment of Schroders would provide “a more balanced blend of investment styles for the fund”.

“We continue to see Impax as a leader in investing in the transition to a more sustainable economy and a key partner for us in the future,” he added.

Alex Tedder, co-head of equities at Schroders, said investors “are increasingly focused on bespoke investment solutions that are able to deliver strong risk-adjusted returns together with a comprehensive commitment to sustainability”.

Schroders will manage the SJP mandate through its Global Sustainable Value Equity and Global Sustainable Growth strategies.

The SJP fund returned 12.7 per cent over the past year, underperforming the MSCI ACWI index of large and mid-cap developed market shares, which returned 21.6 per cent.

Impax said: “Our understanding is that St James’s Place wanted to adjust the investment style of the fund to be more ‘value’ oriented.”