France’s Fonds de Reserve pour Les Retraites (FRR) has announced the results of its tender for a €400m responsible active management mandate targeting all-cap Japanese equities.

FRR’s restricted tender was launched in February 2024 with the purpose of selecting a maximum of three ‘blended’ responsible active management mandates. It has now been revealed that FIL GESTION, Nomura Asset Management Europe and Lombard Odier Funds have been awarded contracts.

The providers will implement exposure to Japanese equities of all capitalisations, referenced to the ‘Russell Nomura Total Market’ index, customised for taxation, controversial weapons and tobacco.

FRR said this ‘blended’ management approach makes it possible to make the best use of the depth offered by the Japanese equity market, an asset class that has been present in its strategic allocation since its inception.

“As a member of the Net Zero Asset Owner Alliance, the FRR has committed to reducing the net greenhouse gas (GHG) emissions of its investment portfolio to a level compatible with the Paris Agreement,” FRR stated.

“The selected managers aim to implement FRR's responsible investor strategy, and in particular to achieve a target of reducing GHG emissions, based on the level of the benchmark index at the launch of the market, of around 60 per cent before 30 June 2029. They will also be required to provide detailed and regular extra-financial reports on all ESG aspects.”

The contract is for a five-year period, with the possibility of renewal for a further one year and is worth an indicative average amount of €400m.

“FRR is pleased with the quality of the bids received for this contract and would like to thank all the companies that submitted bids, also commending their strong commitment to taking into account the ESG issues that are important to FRR,” the fund stated.

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