French insurance sector pension fund announces investment in Scientific Beta low carbon multi-factor indices
Launch of Scientific Beta SACRA US and Eurozone Low Carbon Multi-Factor Indices
Scientific Beta, the smart beta index provider, and SACRA, a pension fund for the French insurance sector, have announced the launch of two low carbon multi-factor indices for the US and Eurozone regions.
This move comes as part of SACRA's reorganisation of the management of its equity portfolio. The US equity portfolio, and part of the Eurozone equity allocation, are now invested to track the two multi-factor indices from Scientific Beta. In addition to seeking higher long-term financial returns by efficiently harvesting academically grounded risk premia, these indices comply with SACRA's own responsible investment policy and apply a low carbon filter enabling a significant reduction in the strategies’ carbon intensities.
In an original set-up, the rest of SACRA's Eurozone equity portfolio remains managed by four traditional stock-picking asset managers, but these are benchmarked against the Scientific Beta SACRA indices, both in terms of financial performance and carbon intensity reduction. This means the expectations placed on SACRA's other asset managers are much more demanding, both in terms of financial value added and climate change mitigation, than when standard cap-weighted benchmarks are used.
Commenting on this launch, Professor Noël Amenc, CEO of Scientific Beta, said, "We are delighted to be providing SACRA with these low carbon multi-factor indices. Reconciling low carbon and multi-factor investing is the fruit of an R&D process that our researchers in both Singapore and Nice have been conducting for many years and it is one of the top priorities for Scientific Beta, because the fight against climate change is one of our main corporate missions."
Stève Baumann, Chairman of the Board of SACRA, added, "Our aim with these indices is to benefit from risk premia that are grounded in academia while reducing carbon intensity as part of our responsible investment policy. It was also important for us to be able to benchmark our asset managers against the Scientific Beta SACRA low carbon multi-factor indices, so we are very pleased to be doing so."
As part of its policy of transferring know-how to the industry, EDHEC-Risk Institute has set up Scientific Beta. Scientific Beta is an original initiative which aims to favour the adoption of the latest advances in smart beta design and implementation by the whole investment industry. Its academic origin provides the foundation for its strategy: offer, in the best economic conditions possible, the smart beta solutions that are most proven scientifically with full transparency of both the methods and the associated risks.
Scientific Beta, 1 George Street, #15-02, Singapore 049145. For further information, please contact: contact@scientificbeta.com, Web: www.scientificbeta.com.
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