Agenda item

Update on the government consultation.

Under s100B(4)(b) of the Local Government Act 1972, the Chair of the meeting was of the opinion that the report should be considered at the meeting as a matter of urgency by reason of special circumstances. These circumstances were that the Department for Levelling Up, Housing and Communities (DLUHC) published its highly anticipated consultation on governance and reporting of climate change risks on 1 September 2022. As the consultation was published on 1 September 2022, the report was not available at the time of agenda publication. It is requested that the report be considered by the Pensions Committee and Board at its meeting on 12 September 2022 to ensure that it is able to comment on the proposed policy changes included in the consultation. The consultation ends on 24 November 2022 and officers, in consultation with the Chair, intend to respond to the consultation on behalf of the Haringey Council, in its role as Administering Authority for the Haringey Local Government Pension Scheme. This was agreed by the Chair on 12 September 2022.

The Head of Pensions and Treasury introduced the report which provided an update on the government consultation. It was noted that the consultation had been published shortly before the meeting but that the views of the Pensions Committee and Board were sought at this stage to allow the submission of a response in advance of the deadline of 24 November 2022. The Consultation sought views on the government’s proposals, developed in line with the Taskforce on Climate-related Financial Disclosures (TCFD) recommendations, to require Local Government Pension Scheme (LGPS) administering authorities to have effective management and targets for climate risks and opportunities. There would also be a requirement to publish an annual Climate Risk Report by 1 December. It was explained that the key proposals were summarised in Appendix 1 of the report.

It was noted that the Pensions Committee and Board would be expected to consider and review climate-related risks and opportunities and to take proper advice. It was explained that the format of the additional requirements could be decided by members; it could be included within existing reports or considered separately.

It was enquired why the proposals would have four metrics but would only require administering authorities to set a target in one metric. The Head of Pensions and Treasury explained that the aim of this was to allow for individual processes and requirements of different administering authorities, whilst retaining some consistency in climate reporting. It was added that Pension Funds could set more ambitious targets. Alex Goddard, Mercer, noted that it would be possible to include Environmental, Social, and Governance (ESG) and/ or climate change objectives in annual scorecard frameworks for investment consultants.

Members noted that it would be useful to have as much information as possible about the current status of Pension Fund investments in relation to climate change as this would allow for effective comparisons and targets. The Head of Pensions and Treasury noted that this could be included in the consultation response. Members of the Pensions Committee and Board were invited to send any further comments to officers. It was explained that the draft consultation response would be presented to the November meeting but that there would only be two days between the meeting and the deadline for responses.

RESOLVED

To note the summary of the policy proposals included in the Consultation, appended as Appendix 1 to the report, and provide any initial comments and feedback to assist officers in drafting a response to the Consultation.