A new investment trust set up with the unique purpose to offer “better returns for investors and a better impact on society” came a step closer to launch today as it announced the roster of fund managers who will back it.
The People’s Trust, the governance-focused, long term investment trust founded by Daniel Godfrey, former chief executive of the Investment Association,will be backed by Artemis, Comgest, First State, JO Hambro Capital and Lansdowne Partners and is set to launch this September.
The Trust, which successfully crowdfunded £100,000 from more than 2,300 “founders” to support the launch, will continue to raise from the crowd until July 31 (full disclosure – we have crowdfunded this ourselves). Investors can put in a minimum of £10 if they are under 35 and £20 if they are over by visiting the website.
The closed-ended fund, which will be available on mainstream investment platforms such as Hargreaves Lansdown* and Charles Stanley, will also invest 1 to 5 per cent of assets in a portfolio of social impact investments managed by Big Issue Invest, the social investment arm of The Big Issue Group.
It makes clear that is not a charitable donation, but an investment into projects that should generate social impact as well as modest, steady financial returns. It will largely comprise of investments into social enterprises and charities dealing with some of the most difficult issues of deprivation in the UK.
The People’s Trust will target an annual return of Consumer Price Index inflation plus 5 per cent after costs, measured over rolling seven-year periods. Assuming inflation averages 2 per cent a year, this is equal to a target actual return of 7 per cent a year.
Although the Trust is open to everyone, there is a clear alignment between the fund’s aims and the values and financial goals of younger savers, who are both more principles led and more interested in impact investing, according to research.
Mr Godfrey said: “We couldn’t be happier than to work with these excellent managers who are all proven and successful investors and passionate about the power of long-term investment to serve clients and society.
“They are all excited about The People’s Trust’s model, ambition and values and the potential to make investment better for everyone.”
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Ed Siegel, managing director of Big Issue Invest, said: “We are very excited to be involved with The People’s Trust, a bold effort to invest more sensibly and responsibly and to bring intentional social impact investment to the mainstream. Big Issue Invest specialises in providing repayable finance to UK trading charities and social enterprises that are tackling the country’s most challenging social issues. We look forward to extending the opportunity to invest for both a social and a financial return to the investors in The People’s Trust.”
Mark Niznik, fund manager, Artemis Investment Management, said: “We passionately believe in the added value of long-term investing in smaller companies and are delighted to be working with The People’s Trust.
Over the long-term UK smaller companies have consistently outperformed larger companies, something that is well known but under-exploited. By being part of this ground-breaking seven-year mandate, investors in The People’s Trust are well placed to benefit from this trait.”
Arnaud Cosserat, chief executive of Comgest said: “The objectives of The People’s Trust are very much aligned with Comgest’s mission to promote a long term, responsible and independent investment mindset. Our strategy is to invest in a concentrated number of high quality growth companies. We are honoured to work with like-minded investors and pleased that the notions of sustainability, company engagement and truly active investment are gaining traction as a sensible way to achieve attractive financial returns.”
Chris Turpin, managing director, Europe and Middle East, First State Investments said: “First State Investments are delighted to be supporting The People’s Trust. Long term investment, which seamlessly integrates environmental, social and corporate governance issues, can deliver successful outcomes for investors.
The strategy of The People’s Trust in encouraging long-term investment with a high degree of stewardship is a great fit for our own investment approach and philosophy.”