Adviser platform AJ Bell Investcentre is launching a responsible managed portfolio service (MPS) for clients who want to avoid controversial industries and companies with low ESG rankings.
According to AJ Bell, the responsible MPS follows the same structure as its passive and active MPS options, with six risk-managed portfolios matching six risk profiles.
All the portfolios are multi-asset using cash, bonds, equities, and alternatives.
The MPS has an investment management fee of 0.15 per cent with no VAT.
The ongoing charges of the underlying funds within the portfolios vary slightly with the cautious product offering 0.42 per cent and global growth being the highest at 0.5 per cent.
Kevin Doran, chief investment officer at AJ Bell, said the demand for portfolios with a responsible investment approach has “never been higher”.
Doran said: “Advisers have told us this is important to them and a growing number of their clients so, in line with our commitment to offering advisers choice, we have expanded our MPS to include a responsible investment option.
“The portfolios mirror our existing MPS service which is being used by an ever-expanding number of advisers and are also aligned with the existing risk profiling tools advisers use, so will be easy to integrate into their existing business processes.”
He added: “All the portfolios have OCFs of under 0.5 per cent per annum, so we believe this is giving advisers a highly competitive solution for clients that want to invest responsibly without sacrificing the potential for positive returns.”
The six portfolios are implemented primarily using exchange traded funds and each has a 25 per cent allocation to the VT AJ Bell Responsible Growth fund.
According to the firm, using this cornerstone investment gives AJ Bell the flexibility to make allocation changes within the fund, rather than the rest of the portfolio, minimising clients’ potential Capital Gains Tax liabilities.
It also allows clients to invest in specialist ESG areas which would be too small to be held as direct investments within the MPS structure.
The new balanced portfolio in the responsible MPS is about 77 per cent less carbon intensive than its equivalent within AJ Bell's Passive MPS range, the firm said.
For example, switching a £100,000 investment gives the same reduction in carbon emissions as planting 19 acres of forest in one year.
The new offering is available via AJ Bell Investcentre’s Retirement Investment account, Sipp, Isa and General Investment account.
amy.austin@ft.com
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