April 16, 2024

News and Political Commentary

Asset Managers Are Quietly Purging Their Portfolios of Tax Risk

2 min read

There’s a growing sense of unease among asset managers that companies with conspicuously small tax bills pose a financial liability too big to ignore.

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(Bloomberg) — There’s a growing sense of unease among asset managers that companies with conspicuously small tax bills pose a financial liability too big to ignore.

Federated Hermes Inc., Robeco Institutional Asset Management, Van Lanschot Kempen NV and Natixis Investment Managers unit Mirova are among asset managers that have been singling out stocks based on their tax history, a process that in some cases has even led to firms being excluded from portfolios.

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Tax payments that equal less than 15% of profits have become a red flag requiring that — at the very least — the companies’ accounts need to be reviewed, according to investment managers.

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Bloomberg News

2024-03-03 03:49:06

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