CCLA Investment Management, which also manages £7bn in assets for 30,000 charities, has launched the CCLA Better World Global Equity Fund.
The Ucits fund will invest across global equities, on a bottom-up stock picking basis.
Jasper Berens, head of client relationships and distribution at CCLA, said the fund, which is seeded with £230mn of CoE funds, has been launched in response to demand from the company’s institutional clients, who wanted to access the CCLA’s investment strategy for their personal portfolios.
“The performance of the investment team has been very strong," he said.
There are lots of different ways you can think about ESG and sustainabilityCharlotte Ryland, CCLA"This is not least [due to the] cash flow we are generating for our not-for-profit organisations [as] they’re looking not only to grow their capital but for the income from that capital to fund their day-to-day operations.”
Berens added that the firm deliberated over whether creating a fund for retail investors was the right way forward.
“The feeling was, well, if individuals want to do this, the strength of CCLA as a brand could carry significantly wider if we created a capability to not only serve [those] individual investors, but also a wider market that didn’t know us.”
He said CCLA decided to launch a global equity fund as that is the core of what it does within its business.
“It is also the core of most investors, whether individuals or intermediaries.
“We recognise it is a competitive market, but we believe very strongly that with our authenticity and proven track record we can compete in this market.”
History of the investment manager
CCLA was launched in 1958 as the Church of England’s investment manager, and also provides services to charities and local authorities.
It manages £14bn in assets and is independently owned by its clients.
The company works within a “good investment” philosophy, which underpins how they approach investing.
As an investment manager, CCLA has to understand the investment priorities of all of its clients, which Charlotte Ryland, co-manager of the new fund, said can sometimes vary.
“There are lots of different ways you can think about ESG and sustainability…in general we have a view on what what are sensible ethics.”
The new fund will be managed by Ryland and James Ayre, CCLA’s co-heads of investment who have managed the global equity strategy for charity investors since 2016 and 2007 respectively.
Ryland said the fund will not focus on any particular geography or sector, but will look at “quality businesses”.
“[We will focus on] businesses that are able to generate decent cash flow returns on investment, and [we think] can sustain those into the future because of a competitive advantage to their business.”
She added that tech is the biggest part of the portfolio, as well as healthcare, but any “deeply cyclical” business is avoided.
“The big change [we have seen] coming into this year is [the need to] think very carefully about valuations, [ensuring] we are not overpaying for companies.
“Clearly as we have moved into this year, we have seen inflation and interest rates begin to take off, and it continues to be very important to make sure to avoid that de-rating risk from the market.”
sally.hickey@ft.com
