“Insight’s mission is to prioritise its clients’ certainty of meeting their investment objectives,” said Bruce Murphy, Director – Australia and New Zealand at Insight Investment. “We aim to provide investment solutions that deliver quality and excellence by managing financial and, where mandated to, non-financial risks and opportunities, while operating to high ethical and professional standards. We believe that environmental, social and governance (ESG) factors can be important drivers of investment risk and so must be understood when managing portfolios.”

Insight undertook 1,178 engagements in 2022 with debt issuers across 78 countries, including 38 emerging markets. There were 140 dedicated ESG engagements, including a focus on climate change, water management and diversity and inclusion, and Insight further expanded its water risk research, aimed at identifying companies in the relevant Insight portfolios that have high water dependencies.

The report gives case studies of engagements, such as discussions where Insight has held a company accountable for its treatment of employees, a long-term engagement with a Singaporean investment company on climate disclosures and another engagement highlighting the governance issues driving a beverage company’s poor ESG score.

A summary of how Insight engages in active dialogue with companies and governments is also available in this this short video presented by Rhona Cormack, Senior Stewardship Analyst at Insight.

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[1] Responsible Stewardship at Insight: 2023 Report,

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Speaking at a media update, Veroude said that the Fed rate hiking cycle is close to terminal so ambitions for yields in the region of 6 – 7% are not unreasonable on high quality investment grade exposure. Veroude added that high yield credit also presents potential return opportunities for investors on the back of credit rating reviews likely to occur in the expected recessionary environment we may be entering.

Bruce Murphy, Director Australia and New Zealand for Insight commented on the firm’s strategy to make this opportunity available to wholesale investors via the launch of the Australian-domiciled Insight High Income Fund [the Fund]2,3. The Fund has the potential to deliver a consistent monthly income in excess of 3% over the Australian cash rate in addition to capital appreciation over the medium to long term. Murphy cited the importance of daily liquidity and high levels of diversification across securities and industries employed in the strategy, making it a useful supplement to less liquid and higher cost private debt strategies.

The Fund employs a systematic active approach to security selection which aims to take advantage of structural inefficiencies in the bond market to capture potential upside arising from forced selling when bonds are downgraded to a high yield investment rating. Transaction costs may also be minimised through innovative “bond basket” trading methodologies that tap the highly liquid exchange traded fund market.

“Innovative approaches such as the Insight High Income Fund, that offer access to fixed income markets via low cost and liquid means, can create new opportunities for investors who want the potential to produce monthly income with the added prospect of capital appreciation over the medium to long term,” Murphy said.

Insight has operated in Australia for more than 25 years and manages A$39.0bn1 on behalf of Australian investors. Headquartered in London, it has operations in Sydney, New York, Boston, San Francisco, Dublin, Frankfurt and Tokyo.

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[1] As at 30 September 2022. Assets under management (AUM) are represented by the value of cash securities and other economic exposure managed for clients. Figures shown in AUD. FX rates as per WM Reuters 4pm spot rates. Reflects the AUM of Insight, the corporate brand for certain companies operated by Insight Investment Management Limited (IIML). Insight includes, among others, Insight Investment Management (Global) Limited (IIMG), Insight Investment International Limited (IIIL), Insight Investment Management (Europe) Limited (IIMEL) and Insight North America LLC (INA), each of which provides asset management services

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Bruce Murphy

Examples of engagement with regulators and policymakers to seek to mitigate systemic risks facing the environment and society are outlined in Responsible Stewardship at Insight^[1], the annual Responsible Stewardship report from Insight Investment.

Insight is an A$1.2trn^[2] global asset and risk manager with 292 investment professionals^[3] which takes its responsibility to look after its client’s interests seriously. In doing so, it leverages its technical expertise and market presence to seek to influence policymakers for the benefit of clients and investors in general. Examples include responding to regulatory proposals encouraging greater transparency on environmental, social and governance (ESG) issues – details of consultation responses to the US Department of Labor and to the UK Financial Conduct Authority are outlined in the report. Insight also initiated its first wave of research into natural capital risk in corporate bonds, an area which currently lacks robust data that can be used to support investment decision-making.

The report gives further examples of work undertaken on behalf of clients to mitigate systemic risks such as climate change. In addition to a range of relevant case studies, Insight also shares key themes in its counterparty and thematic engagement programmes and outlines priorities for future enhancements to its approach to responsible investment. In 2021 Insight made further enhancements to its proprietary corporate ESG and climate risk ratings, and sovereign ESG framework, all of which directly support engagement efforts. More than 80% of Insight’s direct interactions with debt issuers in 2021 included some form of dialogue on one or more ESG topics. This activity relates to Insight’s mission to increase the certainty of investment outcomes for its clients, typically institutions with long-term funding requirements.

ESG risk assessment and engagement with counterparties is a long-standing part of Insight’s credit research process. Financial institutions such as banks play a particularly important role in driving change and are significant constituents of bond indices. Insight’s scale in liability driven investment, of which derivative management is a significant factor, means that it maintains relationships with a broad range of bank counterparties.  In 2021 Insight enhanced its counterparty engagement process to achieve a greater level of impact with these entities, leveraging its influence to engage banks on issues including the environment, remuneration, diversity and cyber. Insight also introduced central engagement themes to guide the work of its analysts across relevant investment portfolios.

Bruce Murphy, Director, Australia and New Zealand, said: “Investors are increasingly focused on ESG and the potential for portfolios with financial and sustainability targets. For us, a first principle of investing responsibly means managing risk. This includes risks to the wider market, as well as the specific underlying risks that determine whether an investment is fair value.”

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[1] Responsible Stewardship at Insight
[2] As at 30 June 2022. Assets under management (AUM) are represented by the value of cash securities and other economic exposure managed for clients. Figures shown in AUD. FX rates as per WM Reuters 4pm spot rates. Reflects the AUM of Insight, the corporate brand for certain companies operated by Insight Investment Management Limited (IIML). Insight includes, among others, Insight Investment Management (Global) Limited (IIMG), Insight Investment International Limited (IIIL), Insight Investment Management (Europe) Limited (IIMEL) and Insight North America LLC (INA), each of which provides asset management services.
[3] As at 31 March 2022

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Bruce Murphy

Insight Investment, a A$1.4trn1 global asset and risk manager, says Australian investors can seek to narrow downside risks posed by ongoing market uncertainty by deploying various strategies designed to reduce risk, boost portfolio efficiency, and deliver outcomes commensurate with an investor’s goals and risk appetite.

Insight yesterday outlined several operational and environmental challenges that, combined, create a complex puzzle for Australia’s institutional investors and financial advisers guiding their retail clients. These challenges include long-term demographic shifts of an ageing population, regulatory changes and environmental, social and governance expectations, through to macro-economic challenges posed by the Ukraine war, the pandemic, and their global economic consequences.

Bruce Murphy, Director, Australia, and New Zealand at Insight, said complex challenges call for innovative solutions. “We believe that Insight’s risk-focused investment thinking can support Australian investors in the current environment. Looking across the areas of market, regulatory and demographic uncertainty, we can readily identify areas where nimble asset allocation, greater implementation efficiency and a simplified re-think of retirement solutions can maximise certainty for investors.” Mr Murphy said Insight aims to allocate client capital for optimal outcomes by combining investment management skillsets across the historical divide of traditional and so-called alternative assets. “We seek to deploy a dynamic approach to asset allocation, within a disciplined process, which is less concerned by the constraints of alpha or beta generation, more with understanding how best to manage the reflexive nature of those assets to again deliver more certain outcomes for investors within a tighter expected range of returns.”

The example of currency management was cited by Insight to demonstrate its client-centric approach to what is typically a defensive component of portfolios. Murphy sees scope to potentially create improved outcomes without taking additional risk. “These ‘low-hanging fruit’ opportunities are not necessarily apparent to the traditional, passive management of currency exposures,” he said.

Equally, in the growing area of retirement income solutions – especially within an environment of inflation and rising interest rates – Mr Murphy cited the tactic of deploying diversified, low-cost, and efficient access to bond markets that hitherto has been underutilised. “Simple, innovative approaches that offer access to fixed income markets via low cost, liquid means can create potential new opportunities for investors seeking to preserve capital but enjoy the benefits of more certain income along the way,” Mr Murphy said.

Insight has operated in Australia for more than 28 years2 and manages A$43.9bn1 on behalf of Australian investors. Headquartered in London, it has operations in Sydney, New York, Boston, San Francisco, Dublin, Frankfurt, and Tokyo.

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Ereira’s focus will be working with clients on a broad range of tailored currency and equity risk management solutions, leveraging Insight’s 60-strong solutions team, as well as its FX and derivative trading platforms. He will also support Insight’s multi-asset and fixed income capabilities with Australian investors, asset consultants and researchers.

Ereira brings 25 years domestic and international investment experience focusing on foreign exchange, treasury, money markets, fixed income and derivatives. He was most recently founder and director of Cerca FX Consulting, advising institutional investors, high net worth and family offices on currency programs and operational efficiency. Prior to this, Ereira spent 15 years at Principal Global Investors as Head of Passive Currency and Chief Dealer. He was also Manager, Treasury Sales for Japanese Bank SMBC in Australia, and earlier on in his career, Dealer, Money Market and FX Sales at Korea Exchange Bank, based in London.

Bruce Murphy, Director Australia and New Zealand, said: “Ben is a great fit for our organisation.  He has a strong track record working with clients on solutions to manage their risk exposures, which aligns with the heritage and core capabilities of Insight Investment. COVID-19 has put a spotlight on the importance of having strong risk management processes in place to manage uncertainty, and the need in the growing retirement space for better sequencing risk solutions. We’re very much looking forward to Ben being part of our team.”

Insight manages more than A$23bn^[2] on behalf of Australian investors and has offices in London, Dublin, Frankfurt, New York, Sydney and Tokyo.

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[1] As at 30 September 2020. Assets under management (AUM) are represented by the value of cash securities and other economic exposure managed for clients. Figures shown in AUD. FX rates as per WM Reuters 4pm spot rates. Reflects the AUM of Insight, the corporate brand for certain companies operated by Insight Investment Management Limited (IIML). Insight includes, among others, Insight Investment Management (Global) Limited (IIMG), Insight Investment International Limited (IIIL), Insight Investment Management (Europe) Limited (IIMEL) and Insight North America LLC (INA), each of which provides asset management services.
[2] A$23.4bn as at 30 September 2020.

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Bruce Murphy

A new era of big government has begun and is likely to remain underway for decades to come, according to analysis from the global macro research team at Insight Investment, a global investment manager with more than A$1.3trillion under management^[1].

The team has coined a new term, ‘Neofiscalism’, to define the era which has begun to emerge, under which governments take a more direct and proactive role in economic policy and management through fiscal policy. This is in stark contrast to the current regime under which central banks have been largely able to make monetary policy decisions without political interference, it argues.

Gareth Colesmith, Head of Global Rates and Macro Research at Insight, said: “The neoliberal paradigm of smaller government involvement in the economy is under threat. Longer term trends were already moving in this direction, but emergency policies implemented to deal with the COVID-19 crisis have created a potential tipping point.” 

Five implications for markets, according to Insight’s global macro research team:

1. Bond markets may become Japanese-like for a long period. Relatively low volatility by historical standards could lead to a grab for yield that compresses spreads and flattens yield curves.
2. Inflation could trigger spikes in bond yields if it causes quantitative easing to be tapered. Such opportunities are likely to be attractive entry points, as long as the longer-term expectation is for inflation to return to target following the funding squeeze in the real economy.
3. For sovereigns without full control over the currency they issue in, government effectiveness could be key. Effective governments that are able to raise productivity and trend growth could more swiftly reduce debt/GDP ratios.
4. Identifying governments able to maximize trend growth is likely to become important for equity markets as this will become a key driver of earnings.
5. Corporates with state support could have an advantage during funding droughts.

Bruce Murphy, director of Insight Australia and New Zealand, said: “The COVID-19 crisis has pushed fiscal and monetary policy to extraordinary levels.  While Australia’s debt to GDP levels have historically been far lower than many developed economies, we expect the prolonged lockdown in Victoria will see fiscal deficits materially widen on par with the UK, and our debt to GDP ratio to increase significantly.  We believe higher deficits are here to stay and governments will be forced to maintain fiscal deficits at these levels for a prolonged period of time.”

Read the full paper.

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Bruce Murphy

BNY Mellon’s Insight Investment has introduced a research rating system to assess issuers against a set of proprietary environmental, social and governance [ESG] risk metrics. More than 6,500 issuers covering 850,000 respective subsidiaries have been assigned an Insight ESG rating since its introduction late last year. It has been applied to c.99% of companies in euro-denominated investment grade indices, c.95% of those in global investment grade indices.

The rating is a quantitative risk-analysis tool which provides a fresh feed of data into Insight’s credit research hub, alongside non-ESG inputs. It aggregates and assesses external data against a set of 29 ESG risks, creating a bank of information for Insight’s team of 47 credit analysts to review while forming their qualitative evaluations. Analysts’ decisions are also based on direct engagement with companies, a critical part of Insight’s approach to ESG risk analysis. Eighty-two percent of Insight’s meetings with sovereign and corporate debt issuers covered ESG topics in 2019, up from 54% the previous year.

Joshua Kendall, Senior ESG analyst at Insight Investment, said: “Our credit analysts find many holes in externally-available information and poor agreement among data providers about what constitutes an ESG risk. Also, for many smaller issuers, particularly emerging market or high-yield companies, the availability of relevant non-financial data lags information from larger issuers. We’ve responded by creating a series of ESG risk analysis tools to enhance our delivery of the research-led strategies our clients require. This rating is the latest innovation in that series. The earlier climate and sovereign risk models are also being updated.
“The rating is also effective in deepening our analysis of the nascent but fast-developing market for impact bonds, where issuance recently passed the USD$1trn mark.  This market is ripe with opportunities, yet large parts remain obscured by low levels of disclosure, creating challenges around comparability and concerns of ‘impact washing’. Of the 126 new impact bonds analysed in 2019, only 33 satisfied our expectations.”

Bruce Murphy, Director, Australia and New Zealand, Insight Investment, said: “Recent research has shown Australian’s appetite for impact investing has tripled over the past two years, a trend we see continuing. As impact investing becomes mainstream, the key for Australian investors is to ensure they are investing into areas that are genuinely making the positive social or environmental impacts they claim.”

Insight seeks to use its derivatives risk management expertise and influence in bond markets to give a voice to its clients and the millions of investors they represent. We regularly engage with policymakers and regulators on reforms that impact our clients. Our aim is to foster the development of sustainable financial markets that work for them and the members they represent, the ultimate beneficiaries. Insight has led the national conversation around proposed reforms to the Retail Price Index inflation measure, contributed to the interest-rate benchmark reform process, and advocated for pension funds on a series of significant industry consultations. These and other initiatives are outlined in Responsible Horizons, Insight’s annual responsible investment report.

Read the report

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The Fund uses a global multi-asset approach investing across equities, bonds, real assets and total return strategies. Its objective is to deliver positive long-term returns of 5% p.a. in excess of inflation over a rolling five-year period.

Bruce Murphy, Insight Investment Director of Australia and New Zealand commented: “The key step we took when designing this strategy for clients 15 years ago was replacing benchmarks with a risk budget. This was a transformational step which has allowed us to deliver what we see as consistent performance at materially lower risk levels relative to competitors offering more traditional strategic asset allocation-driven processes. Importantly, we understood that many retirees are faced with the prospect of drawing down on their capital at the wrong time; our approach aims to manage investors’ sequencing risk while providing growth asset exposures and upside potential.”

Andrew Campion, General Manager, Investment Products at ASX commented: “We are delighted to attract Insight Investment, an internationally recognised fund manager, to our growing mFund platform. Australian investors are increasingly looking to diversify their portfolios and can easily do so by accessing different asset classes and investment expertise via our transparent platform.”

Insight Investment launched the strategy in Australia in 2014. The fund size is currently A$250 million1 and Insight manages an additional A$2.4 billion1 in the strategy under separate accounts on behalf of Australian institutional investors. Total assets under management for Insight Australia is A$30 billion and A$1.2 trillion globally1

The Fund is currently ‘Recommended’ by Zenith and Lonsec, and available on BT, Macquarie, OneVue, Netwealth and Hub24 platforms.

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Joshua Kendall

A record $234bn in green bond issuance was added to the market in 2019, an increase of more than 50% on the $150bn issued in 2018. While issuance in 2018 and 2017 was relatively flat, 2019 saw a significant jump up in issuers joining the market, when compared to previous years. This watershed moment marks a turning point in the depth of opportunities available to investors, according to Insight Investment, a leading asset manager.

The core sectors for these instruments – financials, governments, utilities, energy and industrials – all experienced significant growth in issuance with financials leading the charge, adding more than $78bn in green bonds over the course of the year. Diversity improved with the telecommunication sector now part of the market. The Netherlands issued its inaugural green bond in 2019 and Germany said it intends to issue a green bond later in 2020.

Josh Kendall, senior ESG analyst at Insight Investment, said: “Green bond issuance in 2019 reached record levels, deepening the universe to more than $747bn. This strong momentum in support of climate transition indicates a turning point for investors.  We expect 2020 to be another record year for green bonds with early indications suggesting a total close to $300bn in issuance.”

Bruce Murphy, Insight Investment Director of Australia and New Zealand, said: “We hope to see increased issuance of green bonds from Australian corporates in 2020. Its issuance last year remained largely level with 2018 ($4.5bn in 2019 vs $4.3bn in 2018), which suggests issuers may be missing out on the swell of demand from a global investment community actively seeking diverse and impactful opportunities. A deeper investable universe will help speed the transition to a low carbon economy and hopefully create jobs and boost productivity along the way.”

>Social and sustainable impact bonds issuance increased, adding $35bn in 2019, which, together with green bonds, brought total issuance of impact instruments over the year to almost $300bn ($299.8bn). The market also saw the evolution of new types of impact instruments, for example Enel’s transition bond, which may present a model for further issuance from petroleum companies in 2020.

Kendall said: “The overall growth in impact instruments is encouraging but in too many instances we are finding that the targets set out by issuers lack conviction and ambition. We want to see far more attention paid to the quality of the underlying propositions. Insight has awarded ‘green flag’ status to only 27% of the more than 120 impact bonds we have reviewed. This is because the market still struggles with transparency reporting and a clear demonstration of positive impact.”

Insight Investment manages A$30 billion for Australian investors and A$1.2 trillion globally^[1].

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[1] Figures shown in USD. All data sourced from Bloomberg.

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Amy Clements

Insight Investment, a A$1trillion^[1] global investment manager, has expanded its Australian team with the appointment of Amy Clements as a product specialist.

Clements recently transferred to Sydney after six years at Insight’s London-based headquarters where she worked with institutional clients and investment consultants to deliver tailored investment solutions.

Clements is a CFA charterholder who brings a strong understanding of Insight’s capabilities. She will support the continued expansion of Insight’s fixed income, currency and multi asset investment capabilities in the Australian market, building awareness with asset consultants, research houses and investors.

Bruce Murphy, Director Australia and New Zealand said: “Australia is a key strategic market for Insight. Our local footprint has expanded from a currency-only business four years ago to a A$25bn² Australian business across global fixed income, multi asset, currency and innovative risk management solutions. We aim to build long-standing relationships that can develop and deepen in line with our clients’ evolving investment requirements.

“Insight’s structure also evolves in line with the needs of our clients. As part of this process, we identify talented individuals from within the company and advance them into new roles across the world, wherever their skills are needed. Professionals like Amy are fundamental to the success of our client relationships and to our continued growth in the Australian market.”

Insight employs 229 investment professionals globally, of 858 staff in total, and has offices in London, Frankfurt, New York, Sydney and Tokyo.

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