Lifetime Citizen Portal Access — AI Briefings, Alerts & Unlimited Follows
Trustees approve terminating Walter Scott; reallocate proceeds to low‑carbon/index strategies
Loading...
Summary
The University of Maine System investment committee voted to terminate Walter Scott Global Equity in the Managed Investment Pool and Pension Fund, reallocating proceeds to increase large‑cap international and emerging‑market allocations and to an iShares low‑carbon ACWI ETF. The motion passed unanimously.
The University of Maine System investment committee voted to terminate Walter Scott Global Equity in both the Managed Investment Pool and the Pension Fund and reallocate the proceeds to large‑cap international and emerging‑market equities and an iShares low‑carbon MSCI ACWI ETF.
Kelly Regan, the committee’s NEPC lead presenting the recommendation, told trustees that research had “lost conviction in the manager” after a reunderwriting and subsequent downgrade to a neutral rating, and that the strategy’s underperformance and firm outflows justified replacement. “We have lost conviction in the manager,” Kelly said when outlining the recommendation to the trustees.
NEPC recommended reallocating Walter Scott’s 10% allocation in the Managed Investment Pool across the plan’s international and emerging market managers to maintain the plan’s policy alignment with the MSCI ACWI weights. For the Pension Fund, staff recommended replacing Walter Scott with an iShares Low Carbon MSCI ACWI ETF (ticker referenced during the meeting) to remain consistent with the system’s low‑carbon/divestment objectives.
The committee read the resolution and voted. Trustee McMahon moved the motion and Trustee Riley seconded. On the roll call, Trustees Martin, Riley, McMahon, Moore, Baldacci and Worth voted yes and the motion carried.
The advisers said the change is not expected to materially alter the plan’s long‑term expected return or risk profile; NEPC’s projected return and risk metrics for the portfolios remain effectively unchanged after the recommended reallocation. Staff and advisers said implementation details — including timing, transaction costs and transitional steps — would be handled by NEPC and the recordkeeper and reported back to the committee.
The committee’s decision follows NEPC and CapTrust reviews showing mixed performance across several active global equity managers; Walter Scott had been on watch and was downgraded in 2025, NEPC said. Trustees asked for follow‑up reporting on implementation logistics and for confirmation that replacement products meet the system’s low‑carbon and liquidity requirements.
