Shell to Outsource $30B Pension to BlackRock

BlackRock has announced that the $10 trillion asset manager was selected as the outsourced fiduciary manager of Stichting Shell Pensioenfonds, the defined benefit pension fund of Shell plc. Shell will outsource asset management of its 27-billion-euro ($30 billion) fund entirely to BlackRock.

As of August 31, SSPF had a funded status of 134.5%, well above the fund’s minimum required funding ratio of 105%. As of December 31, 2023, the fund had 5,206 participants, 6,468 former participants and 18,160 beneficiaries who joined the company before July 1, 2013, and are based in the Netherlands.

The transfer of Shell’s pension assets to BlackRock is expected to be completed by mid-2025.

Asset management for Shell’s Shell Nederland Pensioenfonds Stichting pension fund in the Netherlands, for employees who joined the company on or after July 1, 2013, will remain unchanged under Achmea Investment Management, according to Shell.

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Globally, more than $300 billion of assets have been transferred to BlackRock’s OCIO business to date. BlackRock was named a winner in the asset management and servicing OCIO category at the 2023 CIO Industry Innovation Awards.

As a part of the outsourcing, Shell’s pension will move to a defined contribution model, as required by the Netherlands Future Pensions Act. BlackRock will assist in the transition to the new pension system. A spokesperson for Shell could not be immediately reached for comment.

Future Pensions Act

Shell’s appointment of BlackRock as its fiduciary manager comes as the Netherlands plans a complete overhaul of the country’s pension system by the end of the decade.

As part of the Dutch Future Pensions Act, which came into effect in July 2023, all defined benefit plans are required to switch to a defined contribution system. Pension funds based in the country have until January 1, 2028, to make the switch.

“In light of the developments regarding the Future Pensions Act and the request from our social partners to transition, the Board has decided, after a careful selection process, to appoint BlackRock as fiduciary manager for SSPF,” said Kenan Yildirim, director of Stichting Shell Pensioenfonds, in a statement.

The law requires defined benefit plan sponsors to submit a transition plan by January 1, 2025.

“In anticipation of the upcoming changes, the appointment of BlackRock will safeguard the execution of the investment process and ensure that the costs and risks of the transition are carefully managed,” Yildirim continued in the statement. “In addition, our participants will benefit from BlackRock’s expertise, global scale and experience in risk management and sustainability.”

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Tags: BlackRock, Defined benefit (db) pension plans, Defined Contribution, OCIO, outsourced chief investment officer, Shell, Stichting Shell Pensioenfonds

On Monday, the California State Teachers’ Retirement System, the largest educator-only pension fund in the world, announced the promotion to investment director roles of two portfolio managers at the $346.5 billion fund.

Rosie Lucchesini-Jack

David Murphy

Rosie Lucchesini-Jack and David Murphy, both senior portfolio managers, have been promoted to director of fixed income and director of global equity, respectively. Lucchesini-Jack will be responsible for managing CalSTRS’ $41.2 billion fixed-income portfolio, while Murphy will manage the fund’s $144.9 billion global equity portfolio.

Lucchesini-Jack and Murphy will report to Geraldine Jimenez, the senior investment director of public markets at CalSTRS. Among their duties, Lucchesini-Jack and Murphy will lead efforts in their asset classes to reach CalSTRS’ target of being net zero by 2050.

“Rosie and David have proven themselves great assets to our investment team and to CalSTRS’ mission of securing the financial future and sustaining the trust of California’s public school teachers,” said CalSTRS CIO Scott Chan in a statement. “Both have demonstrated a commitment to driving excellence in how we invest and have played an important role in the success of their portfolio.

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Lucchesini-Jack has spent more than 20 years at CalSTRS, working on the fund’s fixed-income team since 2001. She was appointed as portfolio manager in 2013 and as senior portfolio manager in 2023. She is responsible for overseeing CalSTRS’ recent entry into private credit, a new asset class for the fund within the fixed-income portfolio.

“Having been a part of Fixed Income for more than 20 years, this allows me to continue working with our skilled and accomplished team while contributing to CalSTRS’ growth and vision,” Lucchesini-Jack said in a statement. “I am excited to embrace the challenges and opportunities ahead alongside some of the most talented and dedicated investment professionals in the industry.”

Lucchesini-Jack earned a bachelor of business administration degree from California State University, Sacramento, with a concentration in strategic management.

Murphy, a CIO NextGen in 2022, has spent nearly 19 years at CalSTRS and was previously an investment officer at the California Public Employees’ Retirement System.

“As someone who attended California state schools from kindergarten through college, I’m humbled and honored to support CalSTRS’ mission on behalf of our members,” Murphy said in a statement.

His current responsibilities include the oversight of all internally and externally managed strategies at CalSTRS. He earned a bachelor of science degree in mechanical engineering from the University of California, San Diego.