UK-based endowment Nesta Trust has divested £120 million from Northern Trust Asset Management following concerns over the manager’s commitment to global climate initiatives.
The £420 million endowment, which funds an independent research and innovation foundation, has moved its global passive equity mandate—representing over a quarter of its total portfolio—to French asset manager Amundi. Nesta confirmed the decision was a direct result of Northern Trust’s withdrawal from the Net Zero Asset Managers initiative (NZAM) and Climate Action 100+.
Chief Investment Officer Jenny Segal stated that asset managers backing away from climate commitments risk compromising their stewardship duties, adding that the economic risks posed by climate change require fund managers to protect portfolio growth through active climate action.
The decision followed direct engagement between Nesta and Northern Trust regarding the alliance exits, after which the investment committee determined Amundi offered better alignment with its sustainability requirements.
Amundi UK Chief Executive Eric Bramoullé welcomed the mandate, noting that institutional clients are increasingly demanding that their investments mirror their responsible investment targets.
The move follows a similar decision by UK master trust The People’s Pension, which reallocated a £20 billion equity portfolio to Amundi after State Street departed Climate Action 100+. Segal expressed hope that Nesta’s action would demonstrate to the broader market that asset owners do not have to accept a rollback of climate commitments by their investment managers.
