State Street Global Advisors (SSGA) has opted all of its European and UK funds into its new sustainability stewardship service, hiring Hannah Shoesmith from Schroders to lead it.
Responsible Investor broke the news that State Street was looking to set up the twin-track service, which will allow clients to opt for their assets to be engaged based on sustainability priorities, in July last year.
While the service is available globally to clients with separately managed accounts, all of SSGA’s European and UK fund ranges have opted in.
The asset management giant does not disclose its European or UK assets individually, but its Q1 results had its total EMEA AUM at $690 billion. The bulk of AUM – $3.4 trillion – is in the Americas, but Asia-Pacific clients account for $544 billion.
EMEA AUM fell by $23 billion from the last quarter of 2024, with SSGA losing several high-profile mandates from AkademikerPension and The People’s Pension. Both funds cited misalignment on responsible investment as a factor in the moves.
Engagement for opted-in clients will be carried out by a separate sustainability stewardship team, which the firm has hired Hannah Shoesmith to lead. Shoesmith leaves her role as head of engagement at Schroders, having joined the UK manager in 2022 from Hermes Investment Management, where she was director of engagement.
Investors opting in to the service will have the option to either use their own in-house voting policy or apply a special sustainability proxy policy which the manager is developing.
“Our sustainability stewardship service has been created in response to feedback received from institutional clients expressing an interest for more engagement with portfolio companies on sustainability topics,” said Ann Prendergast, SSGA’s EMEA head.
“These clients are, in turn, reflecting strong ongoing support for this work from their beneficiaries. In line with our commitment to being a trusted partner, we will continue to deploy our expertise to ensure client needs in this area are met.”
The launch comes amid rising criticism of asset managers from both sides of the ESG aisle, with some managers pulling out of climate and engagement initiatives.
BlackRock announced in February last year that it would develop a new climate-focused stewardship option for clients with a decarbonisation objective.
BlackRock said at the time that its offering would apply to 83 Europe-domiciled funds with a decarbonisation objective, managing around $150 billion of assets. Funds in the Americas and APAC with decarbonisation objectives will also adopt the guidelines subject to board approvals, and the policy can also be applied to segregated mandates.