Sarasin & Partners LLP

Our investment philosophy is truly active and global and we have managed portfolios on this basis for over 25 years. We employ top-down macroeconomic analysis to determine the relative attractions of major asset classes and market sectors, with bottom-up stock selection based around the identification of long-term themes.
The key tenets of our investment philosophy are:
Strategy and risk management comes first – it is essential for us to gain a genuine understanding of each charity’s objectives, in order to create a portfolio that supports the charity’s investment policy statement. We aim to create investment policies that are robust under a range of scenarios and seek to avoid any of our clients becoming ‘forced sellers’ at inopportune moments.
We would suggest that our ‘strategic’ skills, together with the focus and experience of our charity team will contribute significantly to the long-term success of your portfolios. Creating strategies that are appropriate for each of our clients (and critically ensuring that they evolve over time) is a key differentiating feature of Sarasin & Partners: we believe this is a key reason why charities appoint us and retain our services over the longer term.
Global thematic equity selection – where and how a company operates matters more than where it is listed. Our global thematic process knows no geographical bounds and simply seeks to identify the most attractive global companies before their appeal becomes the consensus. We have supported our clients from UK-heavy asset allocations to much more globally diverse portfolios.
Dynamic tactical asset allocation – having agreed a strategic asset allocation and discretionary operating parameters, we seek to add value and reduce volatility by taking advantage of valuation anomalies across the spectrum of asset classes.
Stewardship fully integrated – The analysis of environmental, social and governance (ESG) factors form an integral part of the consideration for every investment decision. We consider ourselves long-term stewards of our clients’ assets and, through our stewardship approach, we would vote actively on the shares we own for the Trust, we would engage with companies where we have concerns, and take part in additional policy work on a number of macro and sector-level practices or policies.

It is rare that an investment in a single asset class will meet the investment objectives of any charity. We seek to design bespoke investment strategies that match each charity’s objectives with a mix of assets that meets their particular risk and return requirements.
From the outset, we seek to obtain as much information about our prospective clients as possible in order to ensure that the strategic advice we provide is based on their individual circumstances. This information is reviewed regularly and the resulting portfolio’s asset allocation is amended as the charity’s objectives or investment markets evolve.
One golden rule of investment is to avoid having to be a forced seller of investments at fire sale prices. One way to avoid this is to organize your affairs into three distinct pots:
1. Short-term reserves – have been earmarked for spending should be held in cash or cash
equivalent assets. While they might not produce significant returns, they are liquid and do not show capital volatility.

2. Medium-term reserves – one can consider taking a little more risk with medium term reserves, where assets are set aside to meet known liabilities over the next 2-5 years or to act as a buffer for the long-term investments should unplanned events occur that need rapid funding.

3. Long-term reserves – many charities will have longer-term reserves and endowments. This should be able to withstand significant capital volatility on the basis that the charity has set aside sufficient funds that can be called upon to meet any short to medium term liabilities. There should be no need to hastily crystallise losses and these portfolios can therefore be invested in riskier assets to generate attractive returns from which a sustainable withdrawal can be taken.

For long-term investors, such as this, seeking growth and income an asset allocation based on the Sarasin Endowments Strategy may be an appropriate starting point. The strategy is well diversified, both by geography and asset class, investing predominantly in ‘real’ assets (70% global equities and 5% commercial property), providing vital inflation protection, with the balance invested in fixed income (15%) and alternative assets (10%).
The strategy is designed to provide a sustainable stream of distributions for the beneficiaries of today, while growing the capital in ‘real’ terms to enable the Charities to continue their charitable objectives into the future.

We aim to manage the majority of each client’s portfolio ourselves through direct investments, to add value through our thematic approach to stock selection and keep costs to a minimum. However, some asset classes would typically be invested in external funds, selected by our experienced in-house team of third-party fund analysts to achieve a degree of manager diversification and obtain exposure to specialists in esoteric areas of the market.
We seek to design bespoke investment strategies that match each charity’s objectives with a mix of assets that meets their particular risk and return requirements. We tend to favour asset classes that have the following characteristics:
- Liquidity
- Transparency
- Cheap to own & manage
There is however place for illiquid and alternative investment strategies in a long term, multi-asset investment portfolio, which may offer the following benefits:
- Lower volatility
- Higher returns
- Uncorrelated returns
- High income
- Exposure to idiosyncratic strategies & boutique investment firms

Risk covers a number of areas and can be interpreted in multiple ways. We strive to ensure that trustees are never ‘surprised’ by our performance and aim to meet their expectations for capital and income volatility. Avoiding disasters is an important part of providing attractive long-term returns and ensuring trustees remain confident in our abilities.

STRATEGY

We believe that an investor’s greatest protection is to ensure that an appropriate investment strategy is in place, as opposed to relying on tactics and skill to navigate through the inevitable choppy market conditions that will occur from time to time.

By achieving a thorough understanding of each of our clients’ assets, liabilities, return objectives and risk tolerance – and reviewing everything on a regular basis - we seek to put in place robust strategies that will meet each client’s investment objectives under a wide range of scenarios.

RESTRICTIONS

Every type of portfolio we manage is covered by formal Investment Guidelines, which sets out the objectives, guidelines and constraints appropriate to any given product or group of portfolios. In putting together investment guidelines, analysis is carried out to ensure that the aims are plausible and achievable within agreed operating parameters and include any ethical restrictions. This is likely to include long-term analysis of individual asset classes in different economic climates.

All restrictions are embedded in the portfolio management protocols in SIC (Sarasin Information Centre) and Charles River. These are bespoke front-to-back systems developed by Sarasin incorporating dealing, portfolio management, reporting, contact data, Know Your Client, operations processes, database and performance calculation. We use pricing feeds from Bloomberg and cash feeds from custodians to ensure that the system is kept up to date. “Hard” restrictions and guidelines create flags and barred actions within SIC.

RISK MANAGEMENT, ANALYSIS AND CONTROLS

Sarasin & Partners LLP operates a ‘3 lines-of-defence’ risk management framework and employs an independent Risk Office to oversee and monitor the business’ Risk Appetite. The Risk Office reports directly into the Partnership Board through the Audit & Risk Committee.

The integrity of portfolios is regularly checked using a variety of reports using proprietary risk analysis tools from external providers (e.g. brokerage, investment consulting and research houses) including Style Analytics and Statpro. These reports are run and assessed by the Investment Risk and Performance Analysis team.

Lastly, it is also worth noting that we operate a team approach to investment management: this is an important part of our risk management process and offering to clients. While a large number of individuals have researched the stocks owned in our clients’ portfolios, they are constructed by a relatively small number of fund managers to ensure a very high degree of commonality. Specifically, this means we do not have to operate ‘model’ portfolios that are loosely followed by a large number of individuals and which can result in very divergent performance.

Sarasin Endowments Strategy (net of 0.41 management fee), as at 31 Mar 2025 :
- 1 year: 4.4%
- 3 year: 13.5%
- 5 year: 50.4%
- 10 years: 86.3%

Yes. Bundled. Our clients typically appoint us as their custodian, a role we then delegate to BNY Mellon or Northern Trust. The costs are included in our standard fee levels. Where clients wish to work with their own choice of custodian, we are happy to operate on this basis but for a small additional charge.