L&G Talks Asset Management

We’ve heard a lot about the need for urgent climate action in the past few months. Sobering documentaries from David Attenborough and hard-hitting activism from Greta Thunberg and the Extinction Rebellion have brought the issue to the forefront of people’s minds. Investors have a pivotal role in meeting the challenge of financing the transition to a low-carbon future and in finding the wealth of returns opportunities that a low-carbon transition presents.   This week we’re coming to you from the studios at the London Stock Exchange after having interviewed the Lord Nicholas Stern, Chair of the Centre for Climate Change Economics and Policy. Lord Stern joined us for our panel webinar ESG: What to know and what to do with LGIM’s Head of Institutional Clients, Mark Johnson, and others on the importance of environmental, social and governance risks and opportunities to investments.   Without a hint of irony, this episode recording was almost delayed due to Extinction Rebellion protestors having super-glued themselves to the entrance of the LSE.   Watch the full webinar with Lord Stern here: https://youtu.be/3ldIlweafvY   LGIM has also co-written a practical guide to climate change for institutional investors: http://www.lgim.com/files/_document-library/capabilities/iigcc-guide-addressing-climate-risks-and-opportunities-in-the-investment-process.pdf  Lord Nicholas Stern, Chairman of the Grantham Research Institute on Climate Change and the Environment at the London School of Economics Mark Johnson, Head of Institutional Clients Mark Chappel, Senior Investment Writer   We want to hear from you! Email us at mark.chappel@lgim.com with your thoughts on the podcast and any suggestions of the types of content you’d like to see covered.   This podcast is intended for investment professionals, and shouldn’t be shared with a non-professional audience. This podcast should not be taken as an invitation to deal in Legal & General investments. Any views expressed during this recording belong to the individuals and are based on market conditions at the time of recording, and do not reflect the views of Legal & General Investment Management. Legal & General Investment Management is authorised and regulated by the Financial Conduct Authority. Legal & General Investment Management, One Coleman Street, London, EC2R 5AA. Register in England no. 2091894. All rights reserved. No part of this audio may be reproduced in whole or in part without the prior written consent of Legal & General Investment Management.

Is a four day working week realistic — or desirable? Chris Jeffery from our Asset Allocation team and Lara Bernard-Villeneuve in our Active Fixed Income team have looked at the data and think it’s more than a leftist’s pipe dream. Set in the context of a history of declining working hours in industrialised countries, the move does not seem so stark – and need not necessarily trigger a drop in wages. In fact, the boost in productivity accruing to companies and countries who have trialled the measure is clear. With investment implications that stretch from tipping the balance in the workforce away from labour and towards capital-intensive production methods, to a boon for leisure sectors and female participation, join us for an interesting discussion on the opportunities and risks of reduced working hours. Read the latest insights from the Active Fixed Income team here: https://futureworldblog.lgim.com/asset-classes/bonds/ •    Chris Jeffery, Strategist, Asset Allocation •    Lara Bernard-Villeneuve, Junior Portfolio Manager, Active Fixed Income •    Mark Chappel, Senior Investment Writer We want to hear from you! Email us at mark.chappel@lgim.com with your thoughts on the podcast and any suggestions of the types of content you’d like to see covered. This podcast is intended for investment professionals, and shouldn’t be shared with a non-professional audience. This podcast should not be taken as an invitation to deal in Legal & General investments. Any views expressed during this recording belong to the individuals and are based on market conditions at the time of recording, and do not reflect the views of Legal & General Investment Management. Legal & General Investment Management is authorised and regulated by the Financial Conduct Authority. Legal & General Investment Management, One Coleman Street, London, EC2R 5AA. Register in England no. 2091894. All rights reserved. No part of this audio may be reproduced in whole or in part without the prior written consent of Legal & General Investment Management.

In this episode, we talk to Madeleine about her path from netball to new issues. Growing up in Lancashire, she studied Mathematics and Economics, before starting her career on the fixed income floor at Barclays. Having moved from investment banking to asset management nearly four years ago, she can no longer call herself a newbie. Madeleine talks through the changes she has seen so far during her time in the industry, including an increased collaboration with the Corporate Governance team on environmental, social and governance considerations. Her best piece of advice for new starters in fund management? Don’t plan your career; just let it happen! Read the latest insights from the Active Fixed Income team here: https://futureworldblog.lgim.com/asset-classes/bonds/ •    Madeleine King, Co-Head of Pan European Investment Grade Research •    Mark Chappel, Senior Investment Writer We want to hear from you! Email us at mark.chappel@lgim.com with your thoughts on the podcast and any suggestions of the types of content you’d like to see covered. This podcast is intended for investment professionals, and shouldn’t be shared with a non-professional audience. This podcast should not be taken as an invitation to deal in Legal & General investments. Any views expressed during this recording belong to the individuals and are based on market conditions at the time of recording, and do not reflect the views of Legal & General Investment Management. Legal & General Investment Management is authorised and regulated by the Financial Conduct Authority. Legal & General Investment Management, One Coleman Street, London, EC2R 5AA. Register in England no. 2091894. All rights reserved. No part of this audio may be reproduced in whole or in part without the prior written consent of Legal & General Investment Management.

Once again we’ve gone behind the scenes to find out how LGIM’s investment teams manages funds. The Active Equities team places a major emphasis knowing the companies in which they’re invested inside and out. This could be anything from knowing how a company will respond to a competitor’s latest innovation to how their strategy will hold up for the next 10 or 30 years. It’s all about building that conviction in the investment case and why corporate engagement and access to management is so important. I sat down with Shaunak Mazumder, Senior Fund Manager, and Matthew Courtnell, Equities Product Specialist, to talk more about how concentrated portfolios can be managed with a collaborative, sustainable and long-term mind-set. Read the latest insights from the Active Equities team here: https://futureworldblog.lgim.com/asset-classes/equities/•    Shaunak Mazumder, Senior Fund Manager•    Matthew Courtnell, Equities Product Specialist•    Mark Chappel, Senior Investment Writer We want to hear from you! Email us at mark.chappel@lgim.com with your thoughts on the podcast and any suggestions of the types of content you’d like to see covered. This podcast is intended for investment professionals, and shouldn’t be shared with a non-professional audience. This podcast should not be taken as an invitation to deal in Legal & General investments. Any views expressed during this recording belong to the individuals and are based on market conditions at the time of recording, and do not reflect the views of Legal & General Investment Management. Legal & General Investment Management is authorised and regulated by the Financial Conduct Authority. Legal & General Investment Management, One Coleman Street, London, EC2R 5AA. Register in England no. 2091894. All rights reserved. No part of this audio may be reproduced in whole or in part without the prior written consent of Legal & General Investment Management.

It’s said that the only thing that goes up in falling markets is correlation. Diversification across uncorrelated assets, differentiated sources of returns, and foreign currency exposure can help provide natural risk hedges and still deliver the performance sought by investors. This week, we’re talking to members of LGIM’s Asset Allocation team about why investors need to diversify with purpose and the importance nimble asset allocation. Find out more about keeping asset allocation nimble and sign up to our live webinar on portfolio diversification (6 June) here: http://www2.landginvestments.com/staynimble•    Chris Teschmacher, Fund Manager, Asset Allocation team•    Duncan Weldon, Strategist, Asset Allocation team•    Mark Chappel, Senior Investment WriterWe want to hear from you! Email us at mark.chappel@lgim.com with your thoughts on the podcast and any suggestions of the types of content you’d like to see covered.This podcast is intended for investment professionals, and shouldn’t be shared with a non-professional audience. This podcast should not be taken as an invitation to deal in Legal & General investments. Any views expressed during this recording belong to the individuals and are based on market conditions at the time of recording, and do not reflect the views of Legal & General Investment Management. Legal & General Investment Management is authorised and regulated by the Financial Conduct Authority. Legal & General Investment Management, One Coleman Street, London, EC2R 5AA. Register in England no. 2091894. All rights reserved. No part of this audio may be reproduced in whole or in part without the prior written consent of Legal & General Investment Management.

The race to provide faster broadband is on. But will incumbents be disrupted by the challenger providers: the 'altnets'? The upcoming set of results from BT and their strategy for the future will be crucial in determining the answer. In 2018, UK consumers spent a total of one day a week online, more than twice as much as in 2007. Time spent online, demand for data and the number of devices connected to the internet all continue to grow, generating demand for ever faster and more reliable internet connections. BT currently passes less than a million homes with full fibre, targeting three million by 2022, and potentially leaving the company vulnerable to market share losses from the altnets in the long term. BT’s future depends on this investment decision – will management be willing to take some short term pain to preserve its long-term success? Read Marija and Madeleine’s blog here: https://futureworldblog.lgim.com/categories/themes/uk-broadband-infrastructure-at-a-crossroads/?cid=lgimtalks •    Marija Simpraga, Infrastructure Strategist, Real Assets team •    Madeleine King, Co-Head of Pan European Investment Grade Research, Global Fixed Income team •    Mark Chappel, Senior Investment Writer We want to hear from you! Email us at mark.chappel@lgim.com with your thoughts on the podcast and any suggestions of the types of content you’d like to see covered. This podcast is intended for investment professionals, and shouldn’t be shared with a non-professional audience. This podcast should not be taken as an invitation to deal in Legal & General investments. Any views expressed during this recording belong to the individuals and are based on market conditions at the time of recording, and do not reflect the views of Legal & General Investment Management. Legal & General Investment Management is authorised and regulated by the Financial Conduct Authority. Legal & General Investment Management, One Coleman Street, London, EC2R 5AA. Register in England no. 2091894. All rights reserved. No part of this audio may be reproduced in whole or in part without the prior written consent of Legal & General Investment Management.

This week we’ve returned to that famous British obsession: housing. Now that 20% of the UK population are choosing to rent their home, the expectations of lifestyle renters for their home developments have risen accordingly – such as allowing pets or permanent decoration. The build to rent sector involves the large scale development of new housing stock with the needs of ‘lifestyle renters’ in mind. Although the sector is a comparatively young and smaller part of the UK housing puzzle, build to rent can arguably help meet the needs of renters, local authorities and long-term investors alike. Eleanor Jukes returns to discuss all things renting from how these developments can deliver resilient, inflation-linked incomes, to community engagement, to how residents prefer apartment bedrooms to sit alongside rather than opposite one another because the latter has a distinct ‘prison’ feel... Find out more about our Real Assets team here: https://www.legalandgeneral.com/institutional/real-assets/?cid=lgimtalks •    Eleanor Jukes, Senior Strategist, Real Assets •    Mark Chappel, Senior Investment Writer We want to hear from you! Email us at mark.chappel@lgim.com with your thoughts on the podcast and any suggestions of the types of content you’d like to see covered. This podcast is intended for investment professionals, and shouldn’t be shared with a non-professional audience. This podcast should not be taken as an invitation to deal in Legal & General investments. Any views expressed during this recording belong to the individuals and are based on market conditions at the time of recording, and do not reflect the views of Legal & General Investment Management. Legal & General Investment Management is authorised and regulated by the Financial Conduct Authority. Legal & General Investment Management, One Coleman Street, London, EC2R 5AA. Register in England no. 2091894. All rights reserved. No part of this audio may be reproduced in whole or in part without the prior written consent of Legal & General Investment Management.

Variable or fixed rate mortgage? That’s the first question asked once someone knows you’re an economist, in James’s experience. Despite an original plan to study computer programming, when the school didn’t offer the course he turned to economics, following it through academia and into the Treasury. From the world of computer games to interest rate expectations, we explore James’s search for the ultimate ‘underlying spreadsheet’. In our discussion, James talks about how the loss of his father’s job shaped his views of booms, busts and policy levers, and how the provision of capital from the ‘haves’ to the ‘have nots’ drives economic innovation and creative destruction. Today’s guest: •         James Carrick, Global Economist, Asset Allocation team We want to hear from you. Email us at mark.chappel@lgim.com with your thoughts on the podcast and any suggestions of the types of content you’d like to see covered. This podcast is intended for investment professionals, and shouldn’t be shared with a non-professional audience. This podcast should not be taken as an invitation to deal in Legal & General investments. Any views expressed during this recording belong to the individuals and are based on market conditions at the time of recording, and do not reflect the views of Legal & General Investment Management. Legal & General Investment Management is authorised and regulated by the Financial Conduct Authority. Legal & General Investment Management, One Coleman Street, London, EC2R 5AA. Register in England no. 2091894. All rights reserved. No part of this audio may be reproduced in whole or in part without the prior written consent of Legal & General Investment Management.

From the Melrose-GKN bid to the first results of our Climate Impact Pledge, 2018 was a crucial year for better understanding the decisions companies make and how we can make sure the interests of investors are looked after.Technological developments mean that companies are disclosing more data than ever before on their policies and other environmental, social and governance (ESG) metrics, informing our investment and engagement decisions. Sacha Sadan and Meryam Omi join the podcast to talk about the key issues on which they engaged with companies, the recent ESG regulations here in the UK, and the top questions they receive from clients on responsible investing.Read our Active Ownership report here: http://update.lgim.com/activeowner?cid=lgimtalks•    Sacha Sadan, Director of Corporate Governance•    Meryam Omi, Head of Sustainability and Responsible Investment Strategy•    Max Julius, Senior Investment Communications ManagerWe want to hear from you! Email us at mark.chappel@lgim.com with your thoughts on the podcast and any suggestions of the types of content you’d like to see covered.This podcast is intended for investment professionals, and shouldn’t be shared with a non-professional audience. This podcast should not be taken as an invitation to deal in Legal & General investments. Any views expressed during this recording belong to the individuals and are based on market conditions at the time of recording, and do not reflect the views of Legal & General Investment Management. Legal & General Investment Management is authorised and regulated by the Financial Conduct Authority. Legal & General Investment Management, One Coleman Street, London, EC2R 5AA. Register in England no. 2091894. All rights reserved. No part of this audio may be reproduced in whole or in part without the prior written consent of Legal & General Investment Management.

Investing in the Chinese economy often deals with particularly impressive numbers. This is an economy which has tripled in size since 2005, even now contributing approximately a third of all world GDP growth despite fears that China’s growth has fallen to a ‘mere’ 6%. When a fifth of all travel expenditure comes from the less than 10% of Chinese citizens who hold passports, the Chinese consumer is already an immense driving force of that growth. Despite this, the medium-term investment outlook for China is often presented as mixed. The surge in debt levels and demographic concerns over an ageing population lead many to fear a Chinese ‘hard landing’. James and Veeral join the podcast for a fascinating discussion on why China looks like 1970s Japan and how the government’s beginning to change its tune on intellectual property rights. Read James’s latest blog on the China’s structural slowdown here: https://macromatters.lgim.com/categories/economics/chinas-structural-slowdown-why-5-is-the-new-15/ Read Veeral’s latest blog on Chinese mobile subscription costs here: https://futureworldblog.lgim.com/categories/themes/whats-a-chinese-mobile-phone-subscriber-worth/ •    James Carrick, Global Economist •    Veeral Gandhi, Equity Analyst •    Mark Chappel, Senior Investment Writer We want to hear from you! Email us at mark.chappel@lgim.com with your thoughts on the podcast and any suggestions of the types of content you’d like to see covered. This podcast is intended for investment professionals, and shouldn’t be shared with a non-professional audience. This podcast should not be taken as an invitation to deal in Legal & General investments. Any views expressed during this recording belong to the individuals and are based on market conditions at the time of recording, and do not reflect the views of Legal & General Investment Management. Legal & General Investment Management is authorised and regulated by the Financial Conduct Authority. Legal & General Investment Management, One Coleman Street, London, EC2R 5AA. Register in England no. 2091894. All rights reserved. No part of this audio may be reproduced in whole or in part without the prior written consent of Legal & General Investment Management.