Investing with intent: how SMA keeps evolving for members

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If a year is a long time in showbusiness, then five years on financial markets can seem like aeons. This is especially true for the last five. During this period, we saw recovery from the global pandemic and its aftershocks, as well as major monetary-policy moves from several central banks. Heightened geopolitical tensions – including Russia’s war in Ukraine and unrest in the Middle East – the effects of President Trump’s US trade tariffs, and persistent inflation alongside the cost-of-living crisis also shaped the environment. 

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That’s one of the main reasons we’re celebrating the Standard Life Sustainable Multi Asset Universal Strategic Lifestyle Profile’s strong track record through significant turbulence as it reaches its five-year anniversary. We’ve built it to align with our strong belief that the default investment option in a workplace scheme must match the needs of most of the scheme’s members. 

Sustainable Multi Asset’s member-centric ethos and focus on producing long-term growth while reducing financial risk is effective and consistent, as shown by its performance over the five years since inception. The profile’s growth fund produced a cumulative gross return of 55.7%. 

But that consistency doesn’t mean the strategy is set in stone. It’s evolved since launch, making innovation and continuous improvement part of its approach. Below, we take stock and examine some of the key moments that’ve set Sustainable Multi Asset apart from its peers. 

An increasingly popular choice in a changing pensions landscape  

Employers’ confidence and faith in the profile became clear when its assets under management reached around £38.9 billion by 31 December 2025. That Sustainable Multi Asset reached this landmark alongside significant changes in the pensions landscape – ranging from the increase in scheme consolidation to a more intense focus on value for money and the suitability of retirement products – really exemplifies how well it aligns with members’ and employers’ needs.

Considerably reducing the carbon footprint  

Another of the profile’s key achievements over the past five years lies in how much its carbon footprint has shrunk since launchⁱ: carbon dioxide equivalents associated with the portfolio have dropped by a notable 48.7% since 2019ⁱⁱ. 

Defining an appropriate investment universe  

Alongside this, the profile’s exclusions policy has played a crucial role as part of our aim to shape a more resilient investment universe and to avoid harm where we can. According to our 2025 Responsible Investing Viewpoint report, this aligns with what 83% of members want. Since launch, we’ve removed 1,770 companies from consideration. Grounds for doing this range from weak management quality to poor carbon performance and environmental, social and governance (ESG) controversies.  

As part of our wider approach to stewardship, these exclusions help in our aim to direct capital towards businesses that are better prepared for the future, at the same time as encouraging laggards to improve through engagement. We combine them with active stewardship and data-driven tilts (moving investment away from one company to another in an industry based on measures of things like their climate governance and targets). We aim to use this combination to manage long-term financial risk more effectively and support members’ outcomes without sacrificing breadth or opportunity in the underlying portfolio.  

Keeping the profile fit for the future  

Going hand in hand with this focus on improving underlying holdings is the profile’s continuing evolution. Against shifting markets and intensifying regulatory expectations, we’ve adapted Sustainable Multi Asset’s building blocks and strategic design to make sure it stays aligned with what matters most: improving member outcomes and managing long-term financial risks at the same time as capturing opportunities.  

By updating the equity and sustainable corporate bond components to meet the FCA’s Sustainability Improvers label criteria, we’ve strengthened the profile’s ability to capture longterm opportunities in companies that are transitioning effectively. At the same time, the introduction of new corporate bond funds and enhancements to index methodologies have made the strategy better diversified and better aligned with members’ risk and reward expectations.  

What ongoing evolution means for employers 

Employers, too, stand to benefit from this clarity and control. In an environment where value for money, governance standards and transparency are under sharper scrutiny than ever, having a default that evolves without disruption is a significant advantage. Our future proof design allows us to adjust mandates, rebalance exposures and refine sustainability targets without adding complexity for employers. We can also work with the most appropriate investment managers based on particular needs. It’s a quiet, yet purposeful, evolution.  

For us, embracing responsible investment has never meant compromising on financial outcomes. Instead, it helps us target businesses that are more prepared to handle structural shifts like decarbonisation, digitisation and changing supply chains. For members, this means their longterm savings stay exposed to opportunities that can drive growth. At the same time, we aim to manage the risks most likely to erode returns in a disciplined way.  

Together, these enhancements reinforce what Sustainable Multi Asset set out to be from the start: a robust, adaptable and forwardlooking investment solution designed to help members build a more secure financial future. As markets continue to evolve, so will the profile – making it a dependable foundation for retirement planning in the years to come. 

[i] Along with the pensions industry, we’re on a journey to becoming a net zero business by 2050. Our first priority is to support a better financial future for our customers, but we want to support wider, impactful change at the same time. To do this, we’re taking actions we think can help to tackle the climate crisis and manage financial risk for our customers. We’re thinking carefully about where we invest in carbon-emitting sectors and engaging with those contributing the most to the climate crisis to encourage real change. Find out more about our Net Zero Transition Plan. It’s important to note that Standard Life is part of Phoenix Group, so the data shown is for all the Phoenix Group brands combined.
 
[ii] Carbon footprint: Describes carbon emission intensity which is measured in tCO2e/£m using an inflation adjusted enterprise value including cash (EVIC) methodology. This includes both direct and indirect emissions (known as Scope 1 and Scope 2 emissions). It does not include Scope 3 emissions, a type of indirect emission not included in Scope 2.
The figure shows the carbon footprint as at 30/09/2025 compared to the indices as at 2019. The bond fund indices only started in 2020. Therefore the 2019 carbon footprint position is set by making the assumption that it was 7% higher than the 2020 carbon footprint. The fund has tracked these indices from 2025. Prior to this date, the carbon footprint was measured against the parent indices