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HESTA moves forward with internalisation strategy

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A “key milestone” has been reached by the super fund as it moves towards managing at least 15 per cent of its $68 billion portfolio in-house.

HESTA has announced that its in-house Australian equities team is now actively investing, marking a key milestone in its ambitious internalisation strategy.

Over the next two years, the $68 billion super fund plans to have half of its active Australian equities money managed in-house. The short-to-medium term goal is to internally manage at least 15 per cent of its overall portfolio.

As part of the internalisation program, the super fund is also in the process of bringing its fixed interest and cash teams in-house with a completion date set for end-2022.

HESTA CEO Debby Blakey said that the fund’s new hybrid strategy would combine direct investment capability with leading external asset managers.

“Our internal asset management team will help bring us even closer to capital markets, giving us greater access to cutting-edge global investment thinking,” she said.

“This will help us continue to deliver strong, long-term returns and ensure members’ investments are well positioned for a dynamically changing world.”

According to HESTA CIO Sonya Sawtell-Rickson, the internalisation program seeks to enhance investment thinking across the whole portfolio, as well as its responsible investment activities.

“Our HESTA impact program has a strong focus on identifying investment opportunities arising from long-term sustainability trends such as the transition to a low carbon future and the outperformance companies with strong, inclusive and diverse cultures can achieve,” she said.

“We’re well placed to continue developing first-hand knowledge of company business models that can increase our ability to generate competitive, sustainable returns, while amplifying the positive impact we can have on behalf of members.”

A new leadership structure has been adopted by HESTA as part of the internalisation strategy with a number of key appointments made over the past two years to support the plan, including Steven Semczyszyn as the lead of its internal Australian Equities team.

“We’re continuing to build capability across a range of asset classes that will allow us to keep delivering outstanding results for members,” added Ms Sawtell-Rickson.

Jon Bragg

Jon Bragg

Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.