The Governed Portfolios at 15

Published  26 February 2024
   5 min read

Hear from Ken Scott, Head of Investment Solutions, and Trevor Greetham, Head of Multi Asset, Royal London Asset Management, on 15 years of the Governed Portfolios – how they’ve developed, the investment philosophy which underpins them and the outcomes they’ve delivered for our customers.

We launched the Governed Portfolios in January 2009, and currently £50 billion of our customers’ pension savings is invested across the nine actively managed diversified portfolios. Over the past 15 years, they’ve shown resilience through volatile markets – including the global financial crisis and the pandemic - and have delivered strong long-term returns for customers. 

Watch our video


Hi there, My name's Ken Scott, and I'm the head of Investment Solutions at Royal London. I'm here today with my colleague, Trevor Greetham, who's the head of Multi Asset at Royal London Asset Management. Today we're here to talk about the Governed Range, and we're recording this in January 2024 in celebration of 15 years of the Governed Portfolios, which were launched back in January 2009. Today we're going to reflect on the history of the range and think about how that's evolved and performed over time and how it’s structured for continued success.

So Trevor, neither of our tenures go back quite as far as 2009 in our current roles, but yours is probably a bit longer than mine. So do you want to talk us through some of the key developments over the last 15 years?

Sure. Thanks, Ken. I sort of joined Royal London Asset Management in 2015, so I've been part of the story for a fair bit of time.

What I would say over that time is the investment objectives always remain constant. We're trying to maximise return after inflation for a given level of risk. We're doing that through actively managed and broadly diversified portfolios. But staying true to a constant objective means continuous and rigorous reviews, and they've resulted in periodic changes, as you can see on the screen, either to the asset class line-up - we added commodities, emerging market equities - changes to strategic weights, which we’re always doing to try to remain efficient to make sure we're on target for the right risk level and resilient to potential shocks, and changes to our approach. For example, you see there in 2021 the introduction of tilts to reduce the carbon impact of our equity trackers.

Thanks, Trevor. I mean, that reviewable nature of the portfolios is really important and it comes through in what you're saying there, and we've obviously got the enduring aims. The other enduring thing is the beliefs that we found the portfolios on. And so we, you know, we believe strongly in diversification and active management. We believe in the value of governance and we believe in the importance of responsible investment.

Can we maybe pause on active management there. That's, you know, that's your bread and butter at RLAM. Do you want to talk a wee bit about how we deploy that?

Sure. Yeah. I mean, we like to say, slightly tongue in cheek, there's no such thing as passive in multi asset because as soon as you are trying to achieve a particular savings objective through multi asset investing, you can't limit yourself just to stocks and bonds or fix the weights in stocks and bonds. You've got to think actively. And we're active on three different levels. We're active in terms of stock selection. We do daily tactical asset allocation using things like the Investment Clock that you can see on your screen, and that links different investments to different economic conditions depending what's happening with growth and inflation. And we have a dynamic approach to our strategic asset allocation as well. For example, we were carrying very low bond exposure when bond yields were close to zero, but we’ve added back to bonds in our mix in the last year or so as bond yields have risen and we see better return potential over the medium term. So active on three levels.

Thanks Trevor. And I mentioned governance as well there when I talked about the beliefs within the range. Obviously, governance is highlighted even in the name of the portfolios here. But we believe that that's really critical to the success of this range, and that's why we've had right since the beginning of the Governed Portfolios the Investment Advisory Committee that is there to support the decision-making. I like to think that good governance can be a good indicator of future success because that really is one of the proof points of the scrutiny that we put on all that investment decision-making.

I guess the other proof point really is the performance that the range has delivered for our customers. So on the screen here, we've got some of the annual performance numbers across the nine portfolios. If you look at these Trevor, what your reflections?

Well, markets have gone up first of all. You can see better returns for portfolios taking higher risk, the ones further from planned retirement date.

I think what these numbers for 15 years also gloss over a little bit is the steady sort of return that these portfolios have generated. So a passively managed, balanced approach just with stocks and bonds would have surged in 2020, then crashed back down again in 2022, creating a lot of difficulties, particularly for people in lower risk buckets. We've had a steady sort of return to generate these returns.

Excellent. So we're almost done. But one brief comment before we go - so what next for the range? Well, as I said a moment ago, the assets in these portfolios are reviewable, and that means that we can keep these relevant to our customers over time as the investment markets evolve. Now, we're constantly looking at the mix of investments held in these and looking to try and deliver that financial resilience through the diversification of these portfolios.

Trevor, I'll give you the last word. Anything you'd say to conclude?

Well, all I would say is between these strategic reviews and between the governance meetings on a day-to-day basis, we're here trying to select the best stocks for your clients, trying to adjust the tactical asset allocation on a day-to-day basis as market conditions change, geopolitical events happen in the world, the economy evolves.

If you have any questions about any of this or would like to keep in touch with our thinking, please contact your business development manager or please join us for one of our regular adviser webinars. Thanks for listening.


Of course, past performance isn’t a guide to future performance, and the value of all investments can go down as well as up. But we believe the investment philosophy which underpins the Governed Portfolios, including active management, broad diversification, governance and responsible investment, should give you confidence that they have the potential to continue to deliver good long-term financial outcomes for your clients. 

Key milestones

Have a look at our infographic (PDF), which highlights the key milestones in the development of the Governed Portfolios and how they're delivered for your clients over the last 15 years.