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Product Matters

Norwich Union Investment Funds&#39 recent launch of sustainable future funds was not altogether unexpected.

Last year, Morley Fund Management, the fund arm of NU, acquired the Henderson/ NPI socially responsible investment team led by Clare Brook.

Brook and her team have an enviable track record and have dem-onstrated that socially responsible investment can be very profitable.

What has surprised me is the range of funds available – it is very comprehensive. It makes sense when you consider the public is becoming more aware of SRI.

For example, many members of occupational pension schemes will have read about their scheme&#39s stance on this type of investment. This stems from legislation requiring scheme trustees to declare their approach to social and environmental issues.

That appetite is growing and IFAs should be covering the issue with clients. In time, the demand will require that a broad fund range is available and Norwich Union is positioning itself to meet that demand.

It is a similar situation to the Schroders Style fund range. Instead of launching a fund that will sell like hot cakes, NU is playing a long game and is strategically positioning itself.

NU is demonstrating a strong long-term commitment to the investment funds marketplace.

It will be interesting to see how NU balances its sales of life company investment products such as unit-linked bonds with investment funds.

My guess is investment fund sales will grow at the expense of unit-linked bonds.

James Dalby is head of research at Bates Investment Services

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