Legal & General Investment Management has merged two sustainable funds with mandates with similar characteristics, after both funds failed to deliver “broad, long-term performance outcomes”.
The Legal & General Future World Sustainable European Equity Focus fund has been merged into the Legal & General European Equity Income Fund because, according to LGIM’s most recent Value Assessment, the fund “underperformed for a prolonged period relative to its benchmark, and fewer people were investing in it, meaning it was no longer viable”.
The Legal & General European Equity Income fund was selected as an appropriate alternative fund as it is also actively managed, invests in the same region and shares the same benchmark.
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Meanwhile, the Legal & General Future World Sustainable UK Equity Focus fund also underperformed for a prolonged period relative to its benchmark, meaning “it was highly likely that a significant withdrawal of units would be made”.
“This year (as of April 2025), we assessed a total of 84 funds and 82 delivered value for our clients. However, we recognised that both the Legal & General Future World Sustainable European Equity Focus fund and Legal & General Future World Sustainable UK Equity Focus fund were not delivering the performance outcomes that we expect to achieve,” an LGIM spokesperson told PA Future.
“With that in mind, during 2024, we worked to review both funds and to propose an approach to improving value. As a result, we wrote to investors on 4 November 2024 proposing to merge the Legal & General Future World Sustainable European Equity Focus fund into our Legal & General European Equity Income fund, and the Legal & General Future World Sustainable UK Equity Focus fund into our Legal & General Future World UK Equity fund. These mergers became effective on 21 February 2025.”
