Nest to Shift £3.5 Billion Emerging Market Equities to Wellington in Active Strategy Pivot

Britain's largest workplace pension scheme Nest plans to move its entire £3.5 billion ($4.6 billion) emerging market equity allocation to Wellington Management, ending over a decade of passive index investing to strengthen sustainability engagement. The £68 billion scheme, which auto-enrolls more than 14 million UK workers, will transition from Northern Trust's Climate Aware Emerging Markets Equity Strategy, which held stakes in over 1,000 stocks, to a focused portfolio of 100-150 holdings benchmarked to the MSCI Emerging Market index. Wellington, which manages $1.3 trillion in assets including $44 billion in EM equities, will target 100 basis points of outperformance. The MSCI Emerging Market index is up 22% year to date, outpacing the MSCI World Index's 9% gain. Nest holds roughly 5.2% of assets in emerging market equities. The decision follows a similar move by the People's Pension last year toward active quantitative EM strategies.