AMP cuts fees, rejigs allocations on MyNorth sustainability portfolios

AMP has tweaked its MyNorth Sustainable managed portfolios to better align with the firm’s core environmental, governance and social (ESG) principles and slashed annual management fees.

Management fees will drop by at least five basis points across the three portfolios (which include ‘Balanced’, ‘Moderately Conservative’, ‘Moderately Aggressive’ risk profiles). As at the end of September 2024, these fees stand at 0.20% per annum.

Additionally, in an effort to improve the portfolios’ sustainability footprint and diversification, AMP has also rejigged investment allocations across the three risk profiles.

Notably, allocations to alternatives have been cut by between 6% to 8% across the three profiles, with the funds being distributed equally between equities and Australian fixed income classes.

This, AMP said, was done “while maintaining a consistent allocation to growth and defensive assets within each portfolio”.

Alternatives, as at the end of September 2024, represented a maximum of between 21% and 22% of the three risk portfolios.

AMP has also moved to divest from the Vanguard Ethically Conscious International Shares (Unhedged) Fund, and has reduced exposure to the Impax Sustainable Leaders Fund with funds reallocated equally across AXA IM Sustainable Equity Fund, Janus Henderson Global Sustainable Fund and Dimensional Global Sustainability Trust.

These changes were made to ensure AMP North managers could exercise greater influence on companies to achieve improved sustainable outcomes and better execute on ESG objectives.

“Each of these funds has been carefully considered to align with MyNorth portfolios’ sustainability principles and objectives. They also bring specific investment traits to the portfolio (either style or cap bias), increasing the overall diversification,” AMP said.

AMP touts its MyNorth Sustainable Portfolios, which launched in 2020, as multi‑manager, multi-asset portfolios designed to encourage positive social and environmental outcomes while achieving competitive investment returns.

The portfolios are managed via a joint effort between the Perpetual multi-asset and AMP Investments teams`

AMP group executive of platforms Edwina Maloney said the changes recognise that “advisers value choice and flexibility while keeping fees low for their clients”.

She added: “Over the coming months, we’ll continue to target our enhancements for North toward the three aspects that are most important for advisers and their clients in a wrap platform: better retirement solutions, improvement investment choice, ease of administration and value for money.”

David Hutchison, AMP’s general manager of managed portfolios and investments noted the strong demand from advisers and clients for sustainable and ethics-driven investment options, citing research which shows responsible investment now accounts for over one-third of the investment market in Australia.