Barclays introduces strategies to meet Sudan divestment
Mar 2, 2006 (LONDON) — Barclays Global Investors, one of the largest asset managers in the world, announced today the launch of index strategies that will help U.S. public pension plans comply with recent state legislation that requires divestment from companies that have business ties to Sudan.
The new strategies are designed to track well-known U.S. and international equity benchmarks. BGI is also offering investment solutions to plan sponsors who may require customized portfolios to meet the divestiture legislation.
In addition, BGI is exploring developing fixed income strategies that would exclude bonds of companies that do business in Sudan.
“Pension plan sponsors that are impacted have the dual responsibility of complying with the new divestiture legislation and fulfilling their investment objectives,” said Matthew Scanlan, head of BGI’s Americas Institutional Business.
“As a large quantitative manager, who has been serving pension plans for over 30 years, BGI can help plan sponsors by providing the newly created Sudan-free strategies or customizing portfolios to suit specific needs.”
Illinois recently passed a law that orders state public pension funds to divest holdings of companies that do business in Sudan by July 26, 2007. Similar laws have been passed in New Jersey and Oregon, and others have been proposed for California, Connecticut, Indiana, Missouri, Washington, New York, and Ohio, among others.
The new BGI strategies will screen out stocks of companies that have been identified as having business ties to Sudan, while at the same time tracking as closely as possible the return and risk characteristics of the major U.S. and international stock indexes. BGI will rely on an independent research firm to identify companies doing business in Sudan and will use its quantitative portfolio construction techniques to seek to minimize the tracking variance that will occur with the deletion of stocks.
Barclays Global Investors is one of the world’s largest asset managers providing structured investment strategies such as risk-controlled active strategies and indexing.
In the U.S., BGI is one of the largest active managers, set apart by its risk-controlled approach. BGI manages 65% of the world’s 100 largest pension plans.
BGI, together with its worldwide asset management affiliates, managed over $1.5 trillion in assets as of 12/31/05, for more than 2,700 clients in 48 countries around the world. BGI is a majority-owned subsidiary of Barclays Bank PLC.
(ST)