Andrus joins Franklin Templeton from the California Public Employees’ Retirement System (CalPERS), where he served as the Interim Managing Investment Director for Sustainable Investing and led CalPERS’ sustainable investment strategy across its US$443 billion1 investment portfolio.

“James is deeply experienced in corporate governance and brings a wealth of knowledge and expertise in the effective management of financial, human and natural capital to Franklin Templeton,” said Anne Simpson, Franklin Templeton’s Global Head of Sustainability. “We are committed to building dedicated resources as the profound evolution and increasing complexities related to sustainable investing continue in the industry globally. I am delighted for James to join our growing team as we accelerate our efforts in this important area.”

Based in California, Andrus will oversee execution of Franklin Templeton’s sustainability and stewardship initiatives and serve as an advocate and spokesperson with clients, external organizations, policymakers, regulators and internal stakeholders. He will manage the firm’s Global Sustainability Strategy Team, which implements the firm’s sustainable investment strategy and consists of professionals located across Europe, Asia and the United States with additional recruitment underway for data, content, stewardship and product roles. He will also work closely with the firm’s Global Public Policy team.

Andrus will report to Simpson, who is responsible for the firm’s overall strategic direction on stewardship and sustainable investment in her role of Global Head of Sustainability. Simpson reports to Jenny Johnson, CEO and President of Franklin Templeton.

“I am excited by the opportunity to join Franklin Templeton, a world-renowned global investment firm with dynamic leaders, at an important point in time to focus on sustainability,” said Andrus. “I look forward to adding value by advancing the sustainable investment priorities and contributing directly to global regulation and policy initiatives while emphasising enhanced financial information.”

Andrus brings deep industry and regulatory knowledge from his diverse background. Most recently, in serving as Interim Managing Investment Director for Sustainable Investing at CalPERS, he advocated for transparency in the financial markets at the national and international levels to ensure that investors like CalPERS have appropriate regulatory environments for investing their assets. Prior to CalPERS, he was a partner at K&L Gates, a global law firm.

Andrus is an experienced advocate for asset owners as a member of the Securities and Exchange Commission (SEC) Investor Advisory Committee, Public Company Accounting Oversight Board (PCAOB) Investor Advisory Group, Financial Accounting Standards Advisory Council (FASAC) and the International Financial Reporting Standards Advisory Council. He is also co-chair of the Financial Capital Committee of the International Corporate Governance Network (ICGN), representing investors overseeing approximately US$70 trillion.2 In March 2023, Andrus was a recipient of ICGN’s Excellence in Corporate Governance Award. Andrus is also a member of the Executive Leadership Council, a national organization comprising current and former Black CEOs and senior executives at Fortune 1000 and Global 500 companies.3

Andrus is a former U.S. Army officer and a graduate of West Point. He received his J.D. from the University of Texas School of Law.

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Notes:
[1] California Public Employees’ Retirement System assets under management as of March 14, 2023. Source: https://www.calpers.ca.gov/page/investments
[2] International Corporate Governance Network. Source: https://www.icgn.org/
[3] The Executive Leadership Council. Source: https://www.elcinfo.com/what-we-do/

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Simpson joins the firm from the California Public Employees Retirement System (CalPERS), where she served as Managing Investment Director for Board Governance & Sustainability, leading the development and execution of CalPERS’ award-winning Sustainable Investment Strategy across a global portfolio of US$500 billion^[1] with 80% of assets internally managed.

She will report to President and CEO Jenny Johnson and join the firm on 22 February 2022, based in California.

“A hire of this prominence demonstrates our commitment to being a global leader in stewardship and sustainability, which acknowledges that our choices as responsible investors have a profound effect on the world and its future,” said Johnson. “We are confident that Anne’s expertise and leadership will take our firm-wide efforts on sustainable investing to the next level. While the strength of our organisation lies with the breadth and autonomy of our specialist investment managers, we also recognise that an organisation of our scale can have a major impact by working collectively on sustainability issues. We are thrilled to have Anne leading our efforts in this critically important area.”

Simpson commented “I am delighted to join Franklin Templeton, a world-renowned investment firm with a 75-year track record shaped by strong values, innovation and long-term conviction. I look forward to being part of its next phase of growth and evolution in sustainable investing. 2021 was a year in which the asset management industry reckoned with sustainability challenges and the opportunities these bring across global markets. There is new momentum in finance, driven by policymakers in leading European markets, net zero commitments from COP 26 and broad recognition of investors’ role in driving progress on sustainable investing, including important areas like diversity, equity and inclusion, to foster shared prosperity.”

Simpson added, “I’m truly inspired by Jenny’s vision as a third-generation family leader of Franklin Templeton who brings personal commitment to the stewardship and sustainability agenda. I am excited to begin working closely with Jenny, her executive team, and the firm’s accomplished specialist investment managers, to implement the company’s sustainable investing priorities.”

Simpson brings wide-ranging international expertise to this new position at Franklin Templeton. At CalPERS, she served as a member of its Investment Management Committee, which determines asset liability management, capital allocation, risk management and operations across global public equity, fixed income, private equity, private credit, real assets and infrastructure. In addition, she served as the inaugural Chair of Climate Action 100+ and its Asia Advisory Group, a global investor alliance of US$60 trillion which CalPERS convened and co-founded. Simpson also has led the CalPERS investment office diversity, equity and inclusion business initiative, including the founding of 3D (Diverse Director DataSource).

Prior to joining CalPERS, Simpson was a Senior Faculty Fellow and Lecturer at the Yale School of Management, Head of the Global Corporate Governance Forum at the World Bank, Executive Director of the International Corporate Governance Network and Joint Managing Director of Pensions and Investment Research Consultants (PIRC) Ltd.

In 2019, she was named by Time Magazine as one of the 15 women leading the global fight on climate change and in 2020 one of the 100 Most Influential Women in US Finance by Barron’s (Dow Jones). For 11 consecutive years from 2010-21, Anne has been ranked by the National Association of Corporate Directors as one of the year’s 100 most influential people in the boardroom.

Simpson also brings experience in the international regulatory and policy arena. She served on the U.S. Securities and Exchange Commission’s Investor Advisory Committee, the Public Company Accounting Oversight Board’s Investor Advisory Group and the International Financial Reporting Standards Advisory Council. She is an advisory council member for the Official Monetary Financial Institutions Forum, a board member at Ceres and serves on the Leadership Council for the Robert F. Kennedy Center for Justice and Human Rights.

Simpson has published several books in the field, including “The Financial Ecosystem: The Role of Finance in Achieving Sustainability” with Satyajit Bose and Dong Guo of Columbia University (Palgrave MacMillan) and “Fair Shares: The Future of Shareholder Power and Responsibility” with Jonathan Charkham (Oxford University Press).

She graduated from Oxford University in the United Kingdom, where she read Politics, Philosophy and Economics, received bachelor’s and master’s degrees and was a Slater Fellow at Wellesley College, Massachusetts.

Simpson was recently appointed a Visiting Fellow at Oxford University by the Chancellor and teaches at University of California, Berkeley Haas Business School as a Lecturer in Sustainable and Impact Finance.

Franklin Templeton’s commitment to sustainability

As an active manager, Franklin Templeton is proud to offer a wide range of sustainable solutions, and believes its scale allows it to invest in the critical technology that will help each of its boutique managers evaluate investments through an ESG lens. Franklin Templeton is committed to advancing ESG and sustainable investing goals while making sure these investments are productive, profitable and make an impact.

Franklin Templeton has identified climate change as a key strategic priority for the firm and has made commitments to the Task Force on Climate-Related Financial Disclosures (TCFD) and the Net Zero Asset Managers Initiative (NZAMI).

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[1] CalPERS AUM – https://www.calpers.ca.gov/page/investments

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Jenny Johnson

The Franklin Templeton Investment groups and three of their affiliated specialist investment managers ClearBridge Investments, Brandywine Global and Martin Currie — are delighted to announce that they have joined the industry-leading Net Zero Asset Managers Initiative^[1]. These four signatories collectively represent more than US$948 billion in assets under management (AUM).

Launched in December 2020, Net Zero Asset Manager Initiative is an international group of asset managers committed to supporting the goal of net zero greenhouse gas emissions by 2050 or sooner, in line with global efforts to limit warming to 1.5 degrees Celsius; and to supporting investing aligned with aims for net zero emissions by 2050 or sooner. Delivery of the commitment also includes prioritising the achievement of real economy emissions reductions within the sectors and companies in which the asset managers invest.

As of today, the number of signatories consist of 128 investors who have $43 trillion in assets under management, a clear sign of the asset management industry’s recognition that climate change is an urgent priority that must be addressed.

Jenny Johnson, CEO and President of Franklin Templeton, said: “We are excited to make the commitment to the Net Zero Asset Managers Initiative alongside the growing community of signatories. We approach our journey with the clear acknowledgement that we must commit to finding the data and solutions to help us achieve global net zero emissions by 2050. We will work toward this goal in a spirit of authentic engagement and partnership with our clients and stakeholders, in keeping with our belief that good stewardship as a global asset manager means managing and allocating capital to benefit our clients across generations.”

An active manager, ClearBridge Investments is a top 20 shareholder in more than 275 public companies. Terrence Murphy, CEO of ClearBridge Investments, said: “ClearBridge is pleased to join the distinguished roster of signatories to the Net Zero Asset Managers Initiative. As stewards of our clients’ capital with a 30+ year history of integrating sustainability-related investment risks such as climate change into our stock selection process, ClearBridge recognises the urgency of accelerating the transition toward global net zero emissions. Using a partnership approach, ClearBridge will use its role as large shareholders to drive positive change through ongoing company engagement.”

Commitment to Net Zero

As part of the initiative, asset manager signatories have made nine commitments, including to:

• Set interim targets for 2030, for assets to be managed in line with the net zero goal, consistent with a fair share of the 50% global reduction in CO2 identified as a requirement in the Intergovernmental Panel on Climate Change (IPCC) special report on global warming of 1.5°C,
• Take account of Scope 1 and 2 emissions and, to the extent possible, material Scope 3 emissions in investment portfolios,
• Implement a stewardship and engagement strategy, with a clear escalation and voting policy, that is consistent with the ambition for all assets under management to achieve net zero emissions by 2050 or sooner, and
• Create investment products aligned with net zero emissions by 2050 and facilitate increased investment in climate solutions.

Commenting on climate change as one of the greatest challenges and most defining issues of our time, Adam Spector, Managing Partner of Brandywine Global said: “Climate change is an urgent global threat and an underappreciated investment risk. Brandywine Global’s membership to the Net Zero Asset Managers Initiative underscores our commitment to assessing climate risks across capital structures and real economies. We look forward to continuing our ongoing dialogue with government officials and corporate management teams alike about the risks emanating from climate change. We are proud to be part of an initiative that we believe will positively influence the global economy and how companies operate.”

Julian Ide, CEO of Martin Currie concluded: “Martin Currie is delighted to be part of the Net Zero Asset Managers Initiative – a crucial response to improving transparency around climate risks, accelerating the adoption of net zero targets and providing a mechanism so that real-world emissions reductions are achieved. With the countdown to COP 26 in Scotland now well under way, countries are being asked to come forward with ambitious emissions reduction goals, action plans and interim targets that put us on a path for reaching net zero by 2050. To help achieve this, the asset management industry has an important role to play through its actions as long-term stewards of its clients’ assets, and is positioned to both incentivise the adoption of net zero targets and increase the flow of capital to companies providing climate solutions. As a global asset management business headquartered in Scotland, we believe we have an important platform for signalling the industry’s commitments to net zero at this critical time, and our commitment to this initiative is very much a part of that.”

Franklin Templeton’s Stewardship and Sustainability Council and the Global Sustainability Strategy Team have identified climate change as a key strategic priority for the firm and will be implementing this important agenda for change throughout the organisation, in collaboration with the internal stakeholders and clients.

Net Zero Asset Manager Initiative is managed globally by six founding partner investor networks:

• Asia Investor Group on Climate Change,
• CDP,
• Ceres,
• Investor Group on Climate Change,
• Institutional Investors Group on Climate Change, and
• UN PRI

In turn, the initiative is endorsed by The Investor Agenda, of which the investor networks are all founding partners, with the United Nations Environment Programme Finance Initiative.

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[1] Net Zero Asset Managers Initiative

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Jenny Johnson

Franklin Templeton has launched its Corporate Social Responsibility (CSR) Report in recognition of the firm’s long-standing belief that being a responsible corporate citizen is vital to the long-term sustainability of its business, in addition to the well-being of the communities in which its employees live and work.

“The events of the past year, including the global pandemic and ongoing racial and social injustices, have further reinforced the importance of global citizenship both as a business imperative and as part of our responsibility as industry leaders,” said Jenny Johnson, President and CEO. “At Franklin Templeton, we have embedded principles of corporate citizenship into our company culture and our investment strategy. While there is more work to be done, we continue to make important strides to keep these values at the core of what we do for our stockholders, clients, employees and communities.”

Franklin Templeton has established specific goals for fiscal year 2021 focused on three areas: environmental, social and governance (ESG) investing; the environment; and diversity and inclusion (D&I).

• ESG investing: In March 2021, the firm launched its Stewardship and Sustainability Council to guide the continued evolution of ESG infrastructure and best practices. It also published its Stewardship Report, which details its active ownership approach, such as proxy voting and engagement activities.
• D&I: The firm plans to publicly disclose gender and ethnicity representation data as per the U.S. Department of Labor’s Employment Information Report, known as EEO-1. It also plans to invest in female and Black entrepreneurs and expand strategies to increase the attraction, recruitment and development of underrepresented employees, including a focus on further building inclusive leadership capabilities.
• Environment: As it continues to work to reduce its emissions, Franklin Templeton will expand its Scope 3 emissions reporting, set emissions targets and launch an Environmental Committee to advance existing green initiatives.

CSR Report highlights

The report highlights Franklin Templeton’s six dimensions of CSR. In addition to ESG investing, the environment and D&I, this includes employee experience; community engagement; and responsible corporate practices.

“We are proud to continue to develop our CSR reporting as we grow in this critical space, expanding and adapting our corporate citizenship platform and initiatives along the way,” said Kristin Kosmides, Head of Global Citizenship, who led Legg Mason’s CSR function from 2008 until its acquisition by Franklin Templeton in July 2020.

“In addition to helping us coalesce around our shared values, the joining of these two companies has allowed us to solidify our approach and work together to build an even stronger corporate citizenship framework.”

Highlights of Franklin Templeton’s CSR efforts include:

• The firm is a signatory of the United Nations-supported Principles for Responsible Investment (PRI), a set of six investment principles that offer ways to incorporate ESG issues into investment practice. All its specialist investment managers – Brandywine Global, Clarion Partners, ClearBridge Investments, Martin Currie, Royce Investment Partners, and Western Asset Management – are PRI signatories in their own right, as is Edinburgh Partners.
• With the addition of Regina Curry, Franklin Templeton’s first chief diversity officer, who held that role with Legg Mason, the firm has recommitted to the CEO Action Pledge for Diversity & Inclusion and joined Connecticut’s corporate call to action to address economic and racial disparities.
• The firm is a signatory of the Task Force on Climate-Related Financial Disclosures (TCFD) and an investor signatory and participant in the rigorous Carbon Disclosure Project (CDP) annually.
• Franklin Templeton’s CSR efforts are aligned with selected metrics from the Sustainability Accounting Standards Board (SASB), and the report provides disclosures to stockholders, investors and other key stakeholders based on those selected metrics. SASB is an independent nonprofit organisation that sets standards to guide companies in the disclosure of financially material sustainability information. Franklin Templeton is providing information in accordance with certain standards SASB has identified for the Asset Management and Custody Activities segment of the Financials sector.

Read the report.

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The newly-combined organisation establishes Franklin Templeton as one of the world’s largest independent, specialised global investment managers with a combined US$1.4 trillion in assets under management (AUM) across one of the broadest ranges of high-quality investment teams in the industry. The combined footprint significantly deepens Franklin Templeton’s presence in key geographies and creates an expansive investment platform that is well balanced between institutional and retail client AUM.

“We’re extremely excited to announce the close of our Legg Mason acquisition, representing the largest and most significant transaction in Franklin Templeton’s history,” said Jenny Johnson, President and CEO of Franklin Templeton. “A tremendous amount has happened since we made our announcement in mid-February, but the strategic rationale for this powerful combination has only strengthened. This acquisition unlocks substantial value and growth opportunities driven by greater scale, diversity and balance across investment strategies, distribution channels and geographies. Our combined firm is aligned in terms of culture and our shared focus on delivering strong investment results for our valued clients.”

The transaction also brings notable added leadership and strength in core fixed income, equities and alternatives, as well as expanding the firm’s multi-asset solutions capabilities. Importantly, no changes are planned for the specialist investment managers’ differentiated investment strategies, which will benefit from Franklin Templeton’s global infrastructure and ongoing investment in technology and innovation.

“A significant amount of work has gone into preparing us for this exciting firm combination over the past five months, all during an unprecedented pandemic with nearly everyone involved working remotely. I want to thank employees from both companies for their tremendous contributions and exceptional focus on our clients and the business throughout the process,” Johnson added.

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In his new role, Kudva will be responsible for leading the firm’s retail and institutional distribution across the region and continue to be based in Mumbai. Kudva’s appointment is effective at the completion of Franklin Templeton’s acquisition of Legg Mason, which is expected on 31 July 2020.

Kudva brings over three decades of industry experience and expertise in asset management and banking. Prior to taking up this role, he held a similar leadership position as Head of EMEA and India, also based in Mumbai.

Jenny Johnson, President and CEO of Franklin Templeton,said, “The acquisition of Legg Mason will establish Franklin Templeton as one of the world’s largest independent asset managers, with a newly combined AUM that will be over USD$164 billion in the APAC region, after deal close. I would like to congratulate Vivek Kudva on his new role to lead the team in delivering a range of truly diversified global investment strategies through an expansive distribution organisation with global reach and scale. Vivek’s strengths as a leader and depth of experience in various international markets position him ideally to lead our newly combined business in the APAC region.”

In addition, Kudva announced the following senior leadership team with expanded responsibilities in the combined organisation within the APAC region. All new appointments will be effective at the close of the acquisition:

• Matthew Harrison will continue in his role as Managing Director, Australia and New Zealand.
• Linda Liang will take up a new role as Head of China Strategy, overseeing the business of our wholly foreign owned enterprise (WFOE) in China as well as our joint venture company, Franklin Templeton Sealand Fund Management Co. Ltd.
• Isabella Chan will be appointed as Head of Hong Kong, with additional responsibility for the Taiwan business. Shannon Wang will continue as General Manager of Legg Mason Investments (Taiwan) Limited and report to Chan.
• For India, Sanjay Sapre will continue in his role as the President of Franklin Templeton Asset Management (India) Private Limited.
• In Japan, Suguru Kuwahata, currently President of Legg Mason Asset Management (Japan) Co. Ltd., and Tatsuya Oguchi, currently President of Franklin Templeton Investments Japan Ltd., will both report to Kudva and continue to develop the Japan business.
• For Korea, Yong-bae Jeon will continue in his role as President.
• Avinash Satwalekar will take up an expanded role as Country Head of Malaysia with additional responsibility for the oversight of Asia Marketing (ex-Japan and India). He will also continue to serve as Chairman of the Board for Vietcombank Fund Management (VCBF), a joint venture in Vietnam with Vietcombank.
• Dora Seow will take up an expanded role as Country Head of Singapore and the broader South East Asia region (ex-Malaysia and Vietnam) with additional responsibility for Asia Institutional Client Services.
• Richard Surrency, Head of Alternatives Sales, Asia, will continue in his role, focusing on growing the firm’s alternative business in the region.

Kudva commented, “I am delighted to be taking up my new role as Head of APAC for Franklin Templeton. Post the Legg Mason deal close, the combined entity will be well positioned to capitalise on the diverse growth opportunities that exist across the region. Our clients will benefit from the added capabilities across multiple world-class specialist investment organisations, and I look forward to working with my experienced leadership team to continue to deliver the exemplary service our clients expect from us.”

“The combination of our two distribution platforms will enhance organic growth in the region as we expand our presence in key markets such as Japan and Australia. In addition, we see tremendous growth potential in China as the country continues to further liberalise and open up its market,” added Kudva.

Following long and distinguished careers at Franklin Templeton, Mark Browning, Managing Director for Asia Pacific, and David Chang, Regional Head for Greater China, will both depart the firm. Andy Sowerby, currently CEO of Australia & New Zealand and Head of Asia Pacific (ex-Japan) for Legg Mason, has decided to leave the organisation. Browning, Chang and Sowerby will be staying on for a transitional period after the acquisition.

“We would like to thank Mark Browning, David Chang and Andy Sowerby for their dedicated service and invaluable contribution in building a strong franchise for Franklin Templeton and Legg Mason in the region,” said Johnson. “Moving forward, I am confident that our combined regional footprint led by Vivek will create a distribution powerhouse in the region, while significantly deepening our presence in key focus countries.”

The landmark acquisition of Legg Mason will establish Franklin Templeton as one of the world’s largest independent asset managers and will add differentiated capabilities to Franklin Templeton’s existing investment strategies, with modest overlap across multiple world-class specialist investment managers and distribution channels. The combined firm, with USD$1.4 trillion in assets under management, will bring added leadership and strength in core fixed income, active equities and alternatives—as well as an expansion of multi-asset solutions capabilities, a key growth area for the firm amid increasing client demand for comprehensive, outcome-oriented investment solutions.

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