Jamie Abbott introduced the item; this paper has
been prepared to update the Pensions Committee and Board on the
Pension Fund’s risk register and provide an opportunity for
the Pensions Committee and Board to further review the risk score
allocation. The risk assessment presented at this meeting focused
primarily on the investment-related risks.
The following was noted in response to questions
from the committee:
- Cllr
Hymas sought clarification regarding
the Fund’s Environmental, Social and Governance (ESG) policy.
Tim Mpofu explained that the
Fund’s ESG policy would be further discussed as part of the
Investment Strategy Statement (ISS) agenda item which had been
included as part of the exempt portion of the meeting’s
agenda. The ISS sets out what investments the Fund can and cannot
invest in. Through engagement with members, it had been determined
that more time should be taken to consider the Fund’s
approach to responsible investment. The development of such a
policy may require the use of external specialists to advise the
Committee and Board. It was further noted that Funds were required
to outline their approach to managing ESG risks in their ISS,
however a responsible investment policy would be supplementary to
the ISS.
- Cllr White
explained that he thought more emphasis was needed on other parts
of the ESG, such as the social and other ethical sides of
investments. He suggested it would be good to have a deeper
conversation about this and updating the investment strategy upon
reflection.
- Following a
query regarding the outstanding audits, it was confirmed that
officers had investigated whether separate auditors could be
appointed, and this was deemed not possible under the current
regulations. There was an ongoing conversation between the Haringey
finance team and the external auditors to try and address the
external audits backlog. It was confirmed that this issue had been
raised at previous meetings as a concern hence why this had been
included as part of the risk register. It was further noted that
the Government had sent out a letter in the autumn of 2023 where
they had set out how they were planning on tackling public sector
audit backlog; 40% of audits were still outstanding across the
country in the public sector. The Scheme Advisory Board was working
closely with the Government to explore whether pension fund audits
could be separated from the audit of the Council’s statement
of accounts. It was confirmed that a new audit firm would be
undertaking the audit of the current financial year ending 31 March
2024 and the team had already started to engage with on the
planning work. The finance team had discussed the issues relating
to the outstanding audits with them. The team were trying to
progress this but unfortunately the way in which the rules were set
up meant there was not much more that could be done to progress the
issue.
- It was
further noted that there was no provision in the Council’s
constitution that would enable the combined Pensions Committee and
Board to appoint an external auditor. External auditor appointments
for local government bodies were made by the Public Sector Audit
Appointments Limited (PSAA).
RESOLVED
To note and provide any comments on the Fund’s
risk register. The area of focus for review at this meeting was
Investment-related risks.