Chris Briant

PGIM, the US$1.22 trillion global investment management business of US-based Prudential Financial, Inc. (NYSE: PRU) has appointed Chris Briant as head of the Institutional Relationship Group (IRG) for Australia and New Zealand, underscoring its commitment to the Australian market. Briant will be responsible for deepening PGIM’s institutional client coverage in support of its growth ambitions in the region.

As a strategic advisor to chief investment officers of the largest institutional investors in Australia and New Zealand, Briant will help address PGIM clients’ portfolio challenges by leveraging the firm’s multi-affiliate investment capabilities across public and private markets. He reports to Cameron Lochhead, global head of IRG.

Briant was most recently managing director at Morgan Stanley Investment Management, having joined its subsidiary Parametric Portfolio Associates as Parametric’s first Australasian CEO in 2013 to lead the buildout of its business, client and product growth. Prior to that, he held senior roles in investments implementation and business development at Russell Investments, BNP Paribas, and BT Portfolio Services.

“The appointment of Chris reiterates our long-term commitment to the Australian market,” said Lochhead. “Chris brings over three decades of expertise in the Australasian investment industry. As an experienced leader he has an impressive track record in growing businesses and strong relationships with a range of sophisticated asset owners. He will play a strategic role in expanding our institutional investor base in the region and architecting access to PGIM’s full suite of affiliate strategies and solutions.”

PGIM has built a strong footprint in Australia since 2011, supporting a growing network of institutional clients who seek diversified long-term investment solutions across the traditional and alternative asset classes. With a proven track record in private alternative investments, the firm has been managing multibillion-dollar client mandates on the ground, including Australian real estate equity and debt strategies via PGIM Real Estate, and providing debt financing to domestic corporations through PGIM Private Capital.

Briant said, “Very few managers rival PGIM’s scale, breadth and quality across public and private markets. I’m thrilled to be joining PGIM at a time when asset owners are rationalising their manager lineups to form fewer, deeper partnerships, and be part of its growth journey. I look forward to delivering our extensive capabilities to help asset owners solve their investment challenges, and ultimately improve the retirement outcomes for Australasians.”

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Chris Briant

Rest, one of Australia’s largest profit-to-member industry super funds, has awarded an enhanced Environmental, Social and Governance (ESG) mandate to Parametric Portfolio Associates LLC (Parametric) and Calvert Research and Management (Calvert) to provide further diversification to its Sustainable Growth ethical investment option.

Parametric and Calvert are part of Morgan Stanley Investment Management, the asset management division of Morgan Stanley.

Rest’s mandate to Parametric and Calvert will see it implement ethical and sustainable screens and tilts across its listed real assets portfolio, which includes global listed infrastructure, and global and Australian-listed REITs.

Andrew Lill, Rest’s Chief Investment Officer, said: “These additional sector mandates allow for further diversification for Rest members invested in Sustainable Growth, and also adhere to the option’s strict ethical and sustainability requirements. Adding listed real assets to the option’s existing unlisted property and infrastructure assets at this time is expected to provide further resilience in an inflationary environment.”

“Rest’s purpose is to help our members achieve their personal best retirement outcome. With Sustainable Growth, our aim is to provide our younger cohort of members with more choice in how their money is invested, while also delivering a high-performing growth option that outperforms both peers and the benchmark over the long run.”

“Rest supports actions for a better, fairer and more sustainable future, and we have a long-term objective and roadmap to achieve net zero emissions by 2050. Sustainable Growth is just one example of the actions we are taking, and provides an option for Rest members who regard ethical investment as a vital means to achieving their personal best.”

Anthony Eames, Calvert’s Director of Responsible Investment Strategy, said: “As a pioneer in Responsible Investing, we recognised decades ago that strong Environmental, Social and Governance practices can have positive implications for corporate performance. We look forward to working with Rest to deliver a highly customised investment solution reflecting Rest’s ESG priorities while leveraging Calvert’s proprietary insights.”

Chris Briant, Head of Australia and New Zealand, Parametric, added: “We are delighted that Rest has appointed Calvert to work towards enhancing its ESG investing credentials and Parametric as its implementation partner. This is due to our expertise in providing custom indexing solutions and reducing frictions like transaction costs, taxes, brokerage, foreign exchange costs and unintended exposures for super funds.”

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Chris Briant

Retail Employee Superannuation Trust (REST), one of Australia’s largest super funds, with over $60 billion in assets and more than two million members, appointed Parametric and Calvert Research and Management (Calvert), part of Morgan Stanley Investment Management the asset management division of Morgan Stanley, to manage the equities allocation across the newly launched REST Sustainable Growth Option (the Option).

The REST Sustainable Growth Option is a diversified portfolio with enhanced environmental, social and governance investment characteristics weighted towards growth assets. It has an asset allocation across Australian and overseas shares, property, infrastructure, bonds and cash.

Global responsible investment leader Calvert will manage the equities portion of this new Option (which make up approximately 72.5% of the total portfolio), supported by implementation specialist manager Parametric.

The portfolio is positively tilted to companies who are demonstrated leaders in environmental sustainability and resource efficiency, or who are socially equitable and respect human rights, or can demonstrate accountable governance and transparency.

Companies who are involved in labour and human rights abuses, unethical supply chains, fossil fuels, animal cruelty, gender discrimination, tobacco, gambling, palm oil, controversial weaponry, or have a recent track record of environmental damage, or excessive executive remuneration have been excluded from all equity allocations.

The Option’s investments in Australian and overseas shares also aims to have a lower carbon intensity compared to their relative benchmarks.

“We are delighted to have been selected by REST for their industry-leading, low-cost Sustainable Growth Option and after-tax solutions,” says Chris Briant, Head of Australia and New Zealand, Parametric and Calvert.

He says: “This is the first time in Australia we have been able to combine the deep alpha-seeking Responsible Investment capabilities of Calvert with the specialist after-tax-focused implementation strategies of Parametric.”

Calvert’s deep company-level ESG research and over 40 years of experience in areas such as active proxy voting, custom screening, and a focus on an improved ESG performance, as well as Parametric’s specialist implementation offering provides the customized solution REST was seeking.”

Mr. Briant says there is a growing demand from Australian super funds for responsible investing strategies and after-tax solutions, so to be able to secure this mandate with a combined offering is a milestone achievement for Eaton Vance in the Australian market and testimony to the quality of the Calvert and Parametric offerings.

John Streur, CEO of Calvert adds: “Australian super funds are focusing on responsible investing, and have been active in the market for that reason. We were able to demonstrate the intellectual capital behind Calvert’s decades long dedication to responsible investing, and look forward to working with REST to enhance its investment offering to its more than two million members that may choose this Option.”

“The launch of our new Sustainable Growth option is a welcome expansion to the range of options that we offer to our members. Our REST Investments team are pleased to utilise Parametric and Calvert’s equity portfolio construction skills to deliver a diversified investment option offering strong long-term returns within enhanced environmental, social and governance criteria,” says Andrew Lill, Chief Investment Officer at REST.

“REST remains dedicated to providing our members with the opportunity to reach their personal best retirement outcome, by providing greater choice and consistently low-fees across our investment offerings. The introduction of this option has also allowed us to respond to the wants and needs of a number of our members, who have expressed that ethical investing is an important consideration for them when making decisions about how to best invest their super,”  says Mr. Lill.

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Mr  Zhang reports to Chris Briant, Head of Australia and New Zealand, Eaton Vance Management (International) Limited and Paul Bouchey, Global Head of Research, Parametric.

As Manager of Research and Strategy, Australia and New Zealand, Mr  Zhang works closely with Parametric and Eaton Vance’s overseas offices to plan and deliver internal and client-facing thought leadership, including pieces relevant to Australian super funds. He focuses on the firm’s after-tax investing, post-retirement and responsible investing capabilities. He oversees Sydney-based analyst Joshua McKenzie and is a member of Parametric’s global thought leadership team in Seattle.

Mr Zhang joined Parametric in 2015 and most recently worked with the firm’s global core platform technology team as Enterprise Data Management Architect.

Before joining Parametric, Mr Zhang was a portfolio manager at a boutique Australian equities asset manager. He previously worked in asset consulting at Russell Investments and as an analyst with the Australian Prudential Regulation Authority (APRA).

“Our Australian business has experienced significant growth in client assets under management and product breadth over the past eight years,” said Mr Briant. “In the next phase of our growth, Whitlam is critical to further developing our Australasian business. He has an intimate knowledge of the funds management industry, having consulted to superannuation funds in Australia, and has deep local subject-matter expertise. All these experiences will prove invaluable in understanding and helping our clients in his new role.”

Mr Zhang replaces Raewyn Williams, who is leaving the firm after seven years to pursue other interests. Mr Briant commented “While we are excited about Whitlam’s promotion, we are sorry to see Raewyn leave and sincerely thank her for her enormous contribution to the business over the past seven years.  We wish her all the very best for her future.”

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Chris Briant

Super funds will increasingly need investment partners that offer ‘equity agility’ as a core feature to help navigate the mounting pressure to improve returns and lower investment fees, other costs and taxes. The complex task of meeting these goals, says global implementation specialist manager Parametric, is made harder by the fact that they are becoming moving targets.

Chris Briant, Head of the Eaton Vance affiliate’s Australian business, says this pressure is coming from a raft of increasingly vocal super stakeholders including members, politicians and regulators, with APRA’s controversial MySuper Product Heatmap a prime example.

“APRA is using the Heatmap to highlight funds that they believe are either delivering poor net-of-tax returns or have high fees, and focusing on their long-term sustainability based on cashflows. It dovetails with APRA’s plan to have fewer funds, so all funds are under enormous pressure to ’measure up’. But ‘measuring up’ is itself a moving target – we saw this recently in the second iteration of the Heatmap, where some funds’ gradings changed dramatically from the first Heatmap.

“At the same time COVID-19 Early Release has, somewhat ironically, proved a great engagement mechanism for fund members; and we’ve seen some politicians use the current environment opportunistically to grandstand on super. Funds were recently told by Senator Jane Hume (Assistant Minister for Superannuation, Financial Services and Financial Technology) that scrutiny and pressure to rationalise and evolve will be ongoing.”

Briant says the new reality for funds is that their positioning is never ‘finished’ and ‘equity agility’ should be a key part of responding to this new reality, prompting Parametric to launch an ‘Equity Agility Platform’ for Australian super funds – Australian or global equity holdings in a ‘one-stop shop’ Investment Management Agreement (IMA).

“This IMA might be set up for a certain purpose, like passive equity exposure, but can pivot easily from goal to goal as the fund’s needs change; for example, to change benchmarks, add a defensive tilt, serve as a ‘carpark’ when the fund is between managers, plug an unwanted risk exposure, add or remove emerging market exposure, quickly address ESG-related concerns or even chase less orthodox return sources such as equity put and call writing.

“A valuable added benefit reflects Parametric’s pedigree in managing taxes, brokerage and other implementation frictions for super funds. It’s not cost-free for funds to constantly adapt portfolios to their moving targets around returns, fees and other measures. As with the ‘Equity Agility Platform’ accounts we’re already managing, the transition management is built in, so we can manage the costs of making these changes along the way.”

Briant says offering the platform more broadly was prompted by Parametric’s existing work with clients which highlighted the need to deliver solutions that empower funds in three crucial ways: to be able to pivot the portfolio quickly, cost-efficiently, and in a targeted way that focuses on what role the equity portfolio needs to perform for the fund at that time. Parametric’s view is that these needs are not being well met – key reasons why the idea of an ‘Equity Agility Platform’ seems to be striking a chord with super funds.

“Funds are under pressure, more than at any time in their history, and the idea of a transition manager here, a passive manager there, a quant manager over there, an ESG manager added to the mix, an overlay manager sitting across the top, et cetera is becoming increasingly unwieldy in this change environment. What they want is an implementation partner that can pull it all together with a low-cost, simple, transparent fee structure, and stay alongside them as their needs change.

“An ‘Equity Agility Platform’ account ticks all the right boxes for funds and combines the investing thinking and thought generation done within funds with the execution of a trusted investment partner. A platform like this is a powerful response to an environment where the goalposts for funds can change, and change rapidly, and the livelihood of some funds is at stake.”

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Chris Briant

The $9 billion industry superannuation fund Australian Catholic Superannuation & Retirement Fund (ACSRF) has joined forces with the global specialist implementation manager Parametric Portfolio Associates LLC (‘Parametric’) to offer members in its award-winning RetireSmart option a new custom-designed equities strategy with a focus on capital retention and income.

In a new mandate, Parametric will manage the equity portfolio as part of ACSRF’s RetireSmart pension solution, which was launched in 2015 around the concept of separate ‘cash’ and ‘growth’ asset buckets for retirees.

Parametric, who manages existing equity portfolios for ACSRF, collaborated with the fund to co-design the new approach to equity investing in retirement.

The equities strategy breaks new ground in the superannuation industry, which has traditionally designed equities strategies for ‘accumulation-phase’ members still working and saving for their retirement.  With a specific focus on the very different needs of ACSRF’s retired members, Parametric’s goal will be to ensure RetireSmart equities offer downside protection in falling markets and meet specific yield targets above market benchmarks to provide members with a reliable income stream.

Greg Cantor, CEO of ACSRF, believes the new approach shows some of the fund’s best attributes:  “We didn’t want to wait for the Government to impose its ‘CIPR’ retirement product timeline on us or the rest of the industry to really move on this.  We have nearly one-third of our members in retirement, and many more making plans to retire in the very near future. This particular cohort of members have needs that, we felt, required a customised solution. We have established a reputation for innovation across the fund and we are building on this further by rethinking the investment challenge for retired members.”

Chris Briant, Head of Eaton Vance Australia, Parametric’s Australia-based affiliate, says: “ACSRF has rightly recognised the need for a more thoughtful approach to equity investing for retired members, with the COVID-19 pandemic providing a stark reminder of this investment reality.”

Briant also applauded the fund for focusing on its members’ needs and prioritising the issue: “It’s to ACSRF’s credit it has moved ahead of the industry curve by establishing the RetireSmart pension solution and continuing to enhance it.”

A hallmark of the new equities approach has been the extensive research collaboration between ACSRF and Parametric over the past year to workshop different ideas. Key to this particular portfolio will be its ability to generate consistent income for its members whilst ensuring that capital balances are protected from market drawdowns.

Briant says: “We are proud of our investment partnership with ACSRF and are thrilled to have helped them apply our specific equity factor investing, defensive equity and tax management capabilities to a custom member-focused retirement solution.”

For ACSRF’s Cantor, the commitment to partnership is empowering: “We seek investment partners with collaborative cultures and a willingness to customise – these are really powerful tools for us in continuing to lead the way in the retirement solution design space.  Ultimately, it’s easy to ‘talk the talk’ about being focused on members, but actually delivering thoughtful new solutions like this to members – especially in these challenging investment times – shows that we really are living this principle and putting members first.”

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Based in Sydney, Mr. Thurgood is responsible for identifying and developing relationships with pension funds, private banks, fund of funds, institutional investors, investment consultants and other investors in Australia and New Zealand. The Australian office currently oversees more than A$10 billion for clients. He reports to Chris Briant, Chief Executive Officer, Australasia, Parametric Portfolio Associates LLC (Parametric), an affiliate of Eaton Vance Corp.

“I am delighted to welcome Ty to our growing Eaton Vance Australasia team,” said Mr. Briant. “His extensive experience increasing business in Australia with high levels of service and efficiency will ensure we meet client demand and further our commitment to providing deep and comprehensive insights to our clients, as we build customised, advanced portfolios.”

Mr. Thurgood joins Eaton Vance with more than 25 years of experience in the financial industry. He was most recently Managing Director at Nomura Asset Management, where he re-established the firm’s Australian office after the firm’s 25-year absence from the region. Prior to this, Mr. Thurgood spent six years at Russell Investments Australia Ltd. as Head of New Business and Senior Business Development Manager. He previously worked for BNP Paribas Securities Services in senior business development roles. Mr. Thurgood earned a B.A. in Economics and Political Science from University of New South Wales and a Graduate Diploma in Applied Finance and Investment from Securities Institute of Australia.

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Mah Chut boasts more than 17 years in financial services with experience in private wealth investment, accounting, tax and business services. His most recent job was with Cambooya, an Australian family office, where he worked for more than a decade.

Parametric Australia’s CEO Chris Briant says: “We are excited that Simon is joining our team at a time when Parametric is growing. He has a proven track record of adopting an innovative approach to problem solving, client management and project management.

“As we work closely with superannuation funds across various strategies, we look forward to Simon adding value for our clients by creating effective work processes that deliver better outcomes for clients and their members.

“Parametric works with leading Australian superannuation funds to offer various portfolio solutions, including tax-managed centralised portfolio management, tax-managed indexing and factor investing strategies, as well as emerging markets, defensive equities and alternative risk premia strategies.

“We are now well-positioned to consolidate our position in the Australian market and secure more mandates. Super funds need a specialist implementation manager that can maximise transparency and minimise costs, and Parametric has a proven track record in delivering this outcome.”

Mah Chut has previously worked as a Client Manager for Plus Advisory in Sydney and holds a Bachelor of Business (Accounting) from Charles Sturt University. He is a Chartered Accountant, has a Graduate Diploma in Applied Finance and has undertaken leadership studies at MBS (University of Melbourne).

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Chris Briant

Global specialist implementation manager Parametric has been awarded an AUD200 million custom global equities mandate by a large Australian superannuation fund.

The super fund, which has requested anonymity, commissioned Parametric to create a portfolio to capture the super fund’s views around exposures to particular risk factors in global equity markets and address concerns about unintended biases in factor-based portfolios.

The super fund has also asked Parametric to manage real-world implementation frictions, including tax, an approach for which Parametric has developed a distinctive reputation.  The performance of the new portfolio, seeded earlier this month, is being measured against a custom after-tax performance benchmark.

Parametric Australia’s CEO Chris Briant says: “This is a breakthrough in the industry.  In our discussions with super funds, we’ve seen interest in after-tax investing and factor investing as separate themes growing, so it was only a matter of time before they came together as a powerful solution.

“We’ve seen huge growth in the US for factor approaches and now around USD4 billion of our total USD230 billion in funds under management globally are in portfolios that reflect our clients’ preferences around factor exposures.

“Of course, not all factor strategies are created equal.  It’s important that the design rules capture exactly what the client wants, so that the desired exposures drive performance, and not unintended bets.”

In September 2016, in research published for Australian super funds, Parametric described factor investing as a disruptive influence on active equity managers.  Co-author Raewyn Williams, Parametric Australia’s Research Managing Director, views this, perhaps surprisingly, as a positive for active managers:  “It’s an opportunity for active managers to seek generous risk budgets to fully pursue idiosyncratic risk as a nice complement to rules-based factor strategies.”

Briant is positive about Parametric’s ability to win similar future mandates:  “Super funds and their advisers have their own smart ideas about what kinds of portfolios they want.  Sometimes a traditional manager will be best to make these ideas real.  But sometimes, like here, what the fund will really need is a specialist implementation manager that can maximise transparency and minimise the costs of translating good ideas into a real-world portfolio.”

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Chris Briant

Specialist implementation manager Parametric has launched a new strategy for Australian institutional investors after collaborating with Newport Beach, California-based Research Affiliates, seeking to produce better returns and lower volatility than traditional alternative investment approaches.

The new strategy is based on harnessing the power of three key investing factors – Value, Momentum and Carry – and is known as Systematic Alternative Risk Premia, or SARP. The genre is also sometimes referred to as Systematic Global Macro.

The SARP strategy covers equities, bonds, currency and commodities markets.

Parametric’s Australasian CEO, Chris Briant, says “We have close to a decade-long relationship with Research Affiliates, and started working with them on a better solution than a standard ‘black box’ hedge fund in 2016.”

“The Parametric SARP strategy combines powerful Research Affiliates research with Parametric’s distinctive implementation efficiency focus.”

“We know that super funds need to find alternative sources of returns which aren’t correlated to their main source of investment risk – equities. But funds also have tighter liquidity budgets than they used to and fee pressures. These things combined with a growing aversion to strategies that aren’t transparent make it the right time for us to launch SARP, which is a liquid, transparent alternatives solution that provides attractive, diversifying returns in a cost-effective manner” said Mr Briant.

“SARP reflects our ‘systematic alpha’ approach which uses a systems-based model that isolates trades from psychological biases, internal politics and other personal and organisational stresses that too often interfere with executing sound investing strategy.”

“These quantitative strategies using modern financial technology allow investors to profit from global macro opportunities with much greater transparency and lower costs than typical global macro hedge funds” he says.

Research Affiliates studied over three decades of data relating to the three factors of Value, Momentum and Carry.

Research Affiliates’ Global Head of Asset Allocation, Mike Aked, explains that, “the definitions of each factor and each asset class (Equities, Bonds, Currencies and Commodities) were chosen to maximise the future opportunities for the strategy.”

“Our experience of managing Smart Beta strategies for over a decade has reinforced the importance of robustness and implementation characteristics, rather than simply picking the best historical or back test performing factors. Putting the 12 individual strategies together in a single portfolio provides the potential for strong absolute returns at moderate levels of risk and leverage. The final approach, reflecting the collaboration with Parametric, includes features designed to avoid over-complication and reduce the impact of real-world portfolio costs like brokerage, foreign exchange commissions and taxes.”

“With low return prospects across most asset classes, diversifying return drivers become increasingly important. With SARP, our goal is to deliver strong uncorrelated returns in excess of cash within a relatively transparent and low-cost strategy,” says Mr Aked.

Mr Briant adds “Research Affiliates studies and our own research support us targeting outperformance over cash of 7-9% each year, net of fees and transaction costs, and the first year results of the actual strategy, net fees and costs, have certainly delivered on this, and then some. Our target Sharpe ratio of 0.8, net fees and costs, reflects the value of combining diversified strategies, many of which exhibit individual Sharpe ratios of less than half this combined target.”

In addition, the portfolio exhibits positive skew, rather than negative skew associated with crash risk.

“The advantage comes from both higher return and lower volatility – exactly what the ‘free lunch’ of diversification promises” says Mr Briant.

“Low yields, high valuations and anaemic global growth have pushed down expected returns. Given these conditions the likelihood of achieving anything close to a 5% real return is generally considered quite slim, hence the need for alternative solutions, such as SARP. Funds can get SARP in a pooled fund or we can customise a separate mandate to their specifications so that SARP exactly fits their needs. This couldn’t be more different to a ‘one size fits all’ hedge fund offering.”

Mr Briant notes: “We are very happy to be combining our best ideas with those of Research Affiliates to disrupt the traditional ‘black box’ hedge fund space. We believe that the new Parametric SARP strategy hits the sweet spot for super funds in terms of risk, return, liquidity, transparency and fees.”

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