Agenda item

The purpose of the paper is to identify topics that will come to the attention of the Committee and Board in the next twelve months and to seek members’ input into future agendas. Suggestions for future training are also requested.

The Head of Pensions and Treasury introduced the report and explained that the two investment reports scheduled for the meeting in January 2021, Gilts Portfolio and Residential Property, may be considered at a later date depending on progress.

Some members noted that an issue had been raised at a previous meeting about the Pension Fund’s exposure to companies investing in illegal settlements in the West Bank, as defined by the United Nations (UN). It was enquired what the next steps would be to disinvest from these companies.

The Chair explained that, since the issue had been raised at the last meeting, he had liaised with other North London Pension Committee Chairs who met on a regular basis. It was noted that, as the holding of shares linked to illegal settlements was so small and the cost of changing would be about £10 million, the Chairs had asked the Local Authority Pension Fund Forum (LAPFF) to investigate and provide a report on their findings.

The Head of Pensions and Treasury explained that the Pension Fund did not invest in these companies directly. It was noted that all equities investments were done on a passive basis; this meant that the fund manager was instructed to select investments that replicated the market and this was how the Pension Fund had come to invest in these companies. As such, it was not possible to force the fund manager to disinvest from these companies. However, it was noted that the Pension Fund, like a number of other funds, had appointed and was a member LAPFF who advocated and engaged with companies directly when there were concerns about their approach to Environmental, Social, and Governance (ESG) issues. It was added that the Pension Fund had indirectly invested in 12 companies that were identified as investing in illegal settlements. It was noted that this related to approximately 0.21% of 1% of the Pension Fund’s investments, which was approximately £3 million.

Members noted that this was a small investment but that a number of Pension Funds would be in a similar position and the overall amount invested could be more substantial. It was also noted that there were additional companies which were not on the UN list but which had been identified by campaign groups. It was acknowledged that the approach of applying pressure through Pension Committee Chairs was sensible as a starting point. It was agreed that an update on this issue would be provided within the quarterly report at the next Pensions Committee and Board meeting and that the LAPFF report would be included as an appendix.

The Head of Pensions and Treasury noted that The Pensions Regulator (TPR) required Pensions Committee and Board members to receive regular training. Members were asked to complete or re-complete TPR’s training needs analysis so that any relevant training could be organised. Members were also encouraged to complete TPR’s online learning programme, the public service toolkit. It was noted that the relevant links would be circulated to members.

RESOLVED

1.    To note the work plan, the training programme, and the update on member training, attached as Appendices 1-3 of the report.

2.    To complete The Pension Regulator’s public service toolkit and training needs analysis.