© Reuters. Businessman toy figure is placed on U.K. Pound coins in front of displayed Abrdn logo in this illustration taken, November 8, 2021. REUTERS/Dado Ruvic/Illustration
By Carolyn Cohn
LONDON (Reuters) -Russia and Belarus are uninvestable on an environmental, social and governance (ESG) basis, the chief executive of 542 billion pound ($727 billion) asset manager abrdn said on Tuesday as it cut back its exposure to both countries.
Major money managers, many of whom highlight their focus on ESG such as Norway’s sovereign wealth fund and Britain’s university pension fund, have said they are pulling back from Russia following its invasion of Ukraine.
Western countries have imposed unprecedented restrictions on Russia in the wake of its assault on Ukraine and the European Union is planning to impose new sanctions on Belarus this week for helping Moscow.
In response, Russia said on Tuesday that it would impose temporary curbs on foreign investors seeking to exit Russian assets.
“We already had (Russia, Belarus) on a low rating,” Bird told Reuters by phone. “After the conflict we deemed them non-investable”, adding that the invasion was “absolutely shocking”.
Abrdn, a major player in emerging markets, has around two billion pounds of client money invested in Russia and Belarus, or less than half a percent of its AUM, Bird told an earlier media call.
“We have acted to reduce our holdings in Russia and Belarus,” he said.
“We will not invest in Russia and Belarus for the foreseeable future.”
Man Group chief financial officer Antoine Forterre also said on Tuesday that the hedge fund’s exposure to Russia and Ukraine was “negligible” and that it had cut its investments there in recent weeks.
Bird said abrdn had not yet had to suspend any funds due to liquidity issues related to the invasion and sanctions.
Asset managers JPMorgan (NYSE:JPM) and Pictet are among several to have suspended trading in Russia-focused funds this week.
Abrdn’s Russian investments were spread across around 200 funds, Bird told Reuters, and the asset manager had been able to meet redemption requests.
“Those funds will continue to function and will have adequate liquidity.”
Abrdn reported a 47% rise in 2021 operating profit and Man Group saw AUM rise a record 20% on Tuesday.
Russia, Belarus ‘non-investable’ on ethical grounds-abrdn
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