Responsible investing includes allocating to poor-ESG performing EM countries and helping them shift to greener solutions, instead of divesting completely, experts said.
The W100 trillion ($109 billion) institution has agreed to allocate $100 million to a global fixed-income account managed by Pimco. It is in similar negotiations with Western Asset Management (Wamco), although the final size of the mandate has yet to be concluded. Both mandates will use the Lehman Global Aggregate Index as a benchmark.
The institution now has around $3 billion invested in various overseas assets. Park would like to see this figure raised, but says it is hard to find good opportunities. ôThere is so much money already chasing a handful of deals,ö Park laments.
Moreover, Nonghyup still needs to develop its own skills and systems for investing abroad.
The human-resources issue is the biggest challenge. Park notes the traditional way to hire people in Korea means recruiting them out of universities, then rotate them throughout the organisation for a general training, with an initial few years working at branch offices.
This isnÆt the way to create specialised investment experts, so Nonghyup is also looking to hire people from the market. As a large quasi-public organisation û Nonghyup provides various financial services for KoreaÆs agricultural sector employees û it is not attractive to bright young sparks in the financial industry, and they are expensive. So far the organisation has recruited professionals for areas such as M&A, international syndicated loans and venture capital, but many gaps remain.
Partly for this reason, the organisation is now developing relationships with global fund management companies. As this is a new experience, Nonghyup prefers to stick with brand names. Until now, the organisation has invested abroad through pooled funds or investment banking products.
In addition to the Pimco and Wamco mandates, it is looking to invest in its first overseas private-equity funds. Nonghyup has been accepted by KKR to participate in its next big $10 billion fund, expected to launch in the first half of this year and targeting transactions in the United States and Asia. Park is still negotiating terms with the buyout specialist.
The organisation has also already invested in funds managed by MBK, the locally based private-equity vehicle of former banker Michael Kim, which invests in Korean, Japanese and Chinese deals; and last year participated in a Japanese real-estate fund run by Morgan Stanley.
Park is interested in finding new ways to access M&A deals in China, and is considering participating with a W10 billion stake in a new private equity technology fund being put together jointly by SingaporeÆs UOB and Korean VC player STIC Ventures, which will invest around 50% in China, 30% in Korea and 20% in Silicon Valley.
Inflation, fluctuating interest rates, Covid-19 shutdowns, and sporadic reopenings have led to bouts of volatility in the market, with tech stocks bearing the brunt of the selling over the last month.
Amid today’s macro landscape and the need to rethink portfolio planning, asset owners in Asia Pacific are more eagerly embracing responsible investing, says Nuveen’s Simon England-Brammer.
Aware Super appoints deputy CIO and head of governance; AustralianSuper promotes chief risk officer to replace Paul Schroder; Raffles Family Office adds two new roles to independent advisory board; Amundi appoints South Asia CEO; Barclays names China chief executive; Zico hires head of advisory in Singapore; Capital Group names head of HK client group; and more
Nearly 50% of institutional investors and family offices in Asia Pacific intend to increase the number of external managers for their thematic investments in equities over the next 12 months.