Sweeping changes to the Skandia Ethical Fund have raised concerns following the change of investment manager from JP Morgan to environmental specialist Impax Asset Management.

According to data from Financial Express, the fund has dropped blue chip stocks such as HSBC, Tesco and Cairn Energy, from its top ten holdings since taking over.

Ian Aylward, head of alternative asset research at Skandia Investment Group, said although the management and holdings had changed the fund's ethical investment objective remained firmly in place.

'Although we have moved from a multi-manager approach to a single manager, it still has the same ethical screen in place,' he said.

Aylward said Impax had implemented its own ethical screen against the fund’s holdings before making changes, in what he described as a ‘step change’ to the portfolio.

Aylward said the portfolio would consist of between 50 and 60 names, and aimed to have a turnover of ‘50 per cent or so’ per annum.

He said there would be a ‘very small cost’ involved with the changes but expected it to be outweighed by the addition of new names to the portfolio.

However, the fund has a history of high turnover with Financial Express data revealing that the fund had cut 47 holdings from the portfolio in April, when JP Morgan previously managed the majority of the mandate.

Philippa Gee, managing director of Philippa Gee Wealth Management, said the compared with three months previously the portfolio had undergone a dramatic transformation.

‘It’s such a complete change in every respect, the top ten holdings and presumably the whole portfolio has completely changed,’ she said.

Gee said the changes to the to the portfolio would incur some cost to investors.

In August, Impax announced it would be closing its £7.6 million Impax European Leaders fund to concentrate on the Skandia mandate.

In a statement from the firm, it said it had decided in the best interests of clients to wind the Environmental Leaders fund down, as fixed operating costs had added ‘significantly’ to running costs and were having an impact on performance.