Update on our Investment Proposition changes

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We talked to you during our webinars last year about our plans to extend our Sustainable Multi Asset solutions to existing members currently invested in our Active and Passive Plus range. I’m delighted to now share some updates on our progress.

Sustainable Multi Asset – our flagship default investment proposition

We want to offer members a simple, sustainable proposition which aims to help them grow their pension pots over the longer term, while investing responsibly. We believe that as our flagship default investment proposition, Sustainable Multi Asset Universal Strategic Lifestyle Profile can provide this. We are confident in the strength of our Sustainable Multi Asset solutions, and excited to be able to extend these benefits to the millions of existing customers invested in our Active and Passive Plus ranges.

Sustainable Multi Asset Universal utilises a blended Environmental, Social and Governance (ESG) approach, seeking to avoid the bad (screening), improve the good (portfolio tilts) and drive change for the better (stewardship). We will be further enhancing our ESG approach by increasing the content of Sustainable Multi Asset Universal’s growth fund from 64% at launch to around 80% over the course of 2022.

Investing in a responsible way can make financial sense as well as allowing members to invest in line with their morals and values. Environmental and social issues can pose risks and present opportunities that play an important part in the investment process.

Reducing charges for members

We mentioned at last year’s webinars that we would reduce charges, moving to a lower annual management charge (AMC) of 0.98%. You can find more information on what this means for your members here, and more detail on the funds where the AMC has reduced here (PDF 44.8KB).

Successful transition for DC Master Trust members in Active and Passive Plus III and IV

February saw the first of the various cohorts in Standard Life’s existing defaults transition to Sustainable Multi Asset Universal SLP. We have now switched over 87,000 members from our DC Master Trust Active and Passive Plus III and IV solutions into Sustainable Multi Asset Universal. This represents around £969m of assets and demonstrates our capability in successfully executing high volume transitions.

Mailing progress and next steps

In December, we wrote to over 1 million members to let them know that the Active and Passive Plus III options will be evolving to Sustainable Multi Asset solutions. The mailing provided access to detailed information on their new solution. We’ve since tested member recall and understanding of this communication through our regular member survey process, and have seen good levels of understanding showing that the communication has landed well. We will soon start writing to the remaining members in Active and Passive Plus to let them know they will be closing and their investments will be moved to one of our sustainable solutions from end August onwards.

First year milestone and award success

Finally, I wanted to let you know about two recent achievements we’ve celebrated. December 2021 saw the first anniversary of Sustainable Multi Asset Universal, and I’m delighted to let you know that it has accumulated over £1 billion of assets under administration. In February, we won the Pensions Age Master Trust Offering of the Year Award for the second consecutive year. This demonstrates industry acknowledgement in the strength of our workplace proposition and I’m extremely proud of this cross-team achievement.

I’ll keep you updated as our journey continues.