Agenda item

Border to Coast Pensions Partnership Responsible Investment Policy

Minutes:

The Committee considered a report of the Corporate Director of Resources that provided an update on the approach to Responsible Investment at Border to Coast Pension Partnership (BCPP) (for copy see file of minutes).

 

The Pensions Manager presented the report and highlightedBCPP approach to engage companies to drive change for the better as opposed to a blanket policy of divestment from specific sectors. He also highlighted the forward view of areas that BCPP would be reviewing in 2021 and noted that BCPP could potentially vote against board chairs of companies where not enough progress had been made in relation to climate change.

 

Councillor Temple welcomed the report and felt that having a dedicated department to manage Responsible Investment would be a move forward. He asked if there was sufficient capacity to influence the decision to move towards disinvestment if it was felt appropriate in future. The Pensions Manager agreed that a dedicated department responsible for investment was a welcome addition and a real benefit. He advised that there would be an opportunity to influence the direction of travel and setting out a standalone policy on climate change next year. The committee would have an opportunity to revisit Responsible Investment in June 2021 and provide feedback to BCPP. He added that the Responsible Investment policy is a collective one, with BCPP managing assets on behalf of all 11 partner funds in line with the policy. Feedback from the Committee following the training session in June 2021 would be valuable.

 

The Chair commented that all involved in the pool were discussing the same topics at different levels. Moving in the same direction would be dependent on which investments they already had and how well they were doing. He advised that South Yorkshire were furthest forward towards their goals of the councils who are on the BCPP and were looking to disinvest from fossil fuels by 2030.

 

Councill J Atkinson commented that Border to Coast have set their own climate change policy and highlighted that other council’s may be more draconian than others. He suggested that Border to Coast would have to have a fixed policy to take to the pool and asked how it would be achieved taking into account 11 partners who may have different perspectives.

 

Andrew Stone from Border to Coast accepted that different partner funds would have their own views on Responsible Investment. He advised that policies are developed with the aim to achieve consensus and develop best practice in the market during the course of a six month process. Some partner funds would continue to drive further along the spectrum and their own Responsible Investment policy may include things that do not feature in Border to Coast policies. South Yorkshire had set ambitious goals of carbon neutrality by 2030 and were undertaking their own analysis to try and come up with a plan to put into practise. Border to Coast policies on Responsible Investment were not much different to other larger managers and would be receiving the same engagement on certain topics and there would be a clear view coming through on more contentious matters. He further advised that if a partner fund wished to vote on their holding on a particular stock, it was well within their rights to do as long as sufficient notice was given. 

 

Resolved:

That

 

a)     that the Responsible Investment Policy and Corporate Governance and Voting Guidelines Policy included in Appendices 1 and 2 that BCPP will operate on behalf of the Pension Fund for assets transferred into the pool be approved;

b)   that the Corporate Director of Resources be authorised to amend the Fund’s Investment Strategy Statement (ISS) in line with the principles of BCPP’s RI Policy.

 

Supporting documents: