Hedge Fund Man Group Hails New Era After $13 Billion Mandate

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(Bloomberg) — Man Group Plc, the world’s largest publicly traded hedge-fund manager, is seeing growth in client flows as a number of institutional investors in Europe reassign mandates based on sustainability criteria.

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UK-based Man Group’s sustainable-investment offering tends to be “on the more complicated product solutions part of the spectrum and I think for that reason, frankly, we undergrew the market historically,” Jason Mitchell, the hedge fund manager’s head of responsible investment research, said in an interview. But “that now has changed for us.”

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The comments come after Man Group won a $13.2 billion mandate from PFZW in September. The allocation was part of a broader adjustment by the Dutch pension fund, which reassigned a total of €54 billion ($62 billion) in external listed-equity management contracts. PFZW cited sustainability as a key factor, with BlackRock Inc. and hedge fund AQR Capital Management among firms losing mandates, Bloomberg has previously reported.

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“It feels like a great time to be at Man doing responsible investing,” Mitchell said.

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Sustainable investing is showing signs of emerging from a couple of rough years, with clean-tech stocks in particular enjoying a rally. But the strategy remains divisive as financial professionals face a fragmented political backdrop. 

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In the European Union, climate and diversity goals are enshrined in law and major pension investors have shown they want their portfolios to reflect that reality. At the same time, regulations are being wound back amid concerns they’re anti-competitive.

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In the US, banks and asset managers need to navigate ongoing political attacks on investment strategies that take climate or diversity into account. In Norway, meanwhile, the parliament just voted to suspend work by the ethics council advising the country’s $2.1 trillion wealth fund.

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As the politics of environmental, social and governance-focused investing have become increasingly fraught, some money managers have allocated fewer resources to monitoring risks. Firms that held on to their responsible investment experts, meanwhile, are now reaping the benefits, according to Mitchell. 

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While some managers have been “defecting or downsizing teams, we’ve been pretty consistent about investing in data and our quant capabilities and our research,” he said. “A lot of that is now starting to pay off.”

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Man Group’s not alone in its assessment. Rob Genieser, managing partner of ETF Partners, says the asset manager is now planning a fifth fund focused on environmental technologies in 2026. He also says the sharp divide in policies on either side of the Atlantic suggests to him that “this is Europe’s moment.”

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Sophie Flak, managing partner for sustainability and impact at Eurazeo SE, a Paris-based asset manager, says she’s hearing clients demand an investment horizon that’s longer than the political cycle. In private discussions, clients will say that “the Trump administration is here for four years, and the duration of our investment is seven to 10 years,” she said.