Issue - meetings

Report attached.

In accordance with the Statement of Investment Principles Officers had asked the Fund’s Investment Advisor (Hymans), to produce a summary report on the responsible investment activities of the Fund’s Investment managers.

The Fund’s current policy with regard to responsible investments was as follows:

a)     ‘Social, Environmental and Ethical Considerations

The Pensions Committee has carefully considered socially responsible investment in the context of its legal and fiduciary duties and obligations. In view of the objectives set out in this statement, the Pensions Committee takes the view that, non-financial factors should not drive the investment process to the detriment of the financial return of the fund.

Whilst at this time the Pensions Committee has determined not to place any restrictions on Investment Managers for ethical, social and environmental reasons the Pensions Committee considers it appropriate for the Investment Managers to take such factors into account when considering particular investments.

The Pensions Committee also believes that it does not have the relevant expertise to make frequent assessment of the financial impact of companies’ activities. To that extent, the Pensions Committee has a policy of non-interference and the Investment Managers have full discretion over day to day decision making.’

Shareholder voting rights were typically only available to the Fund’s investment managers that had equity holdings: this included the Fund’s investments with Baillie Gifford and SSGA together with the multi-asset mandates managed by Ruffer, GMO and Baillie Gifford, all of which incorporated some level of equity investment.

Hymans report had indicated the voting strategy of the various investment managers, none of which raised concern for the Committee.

The Committee noted the report but asked officers to consider amending the wording of the ‘Social, Environmental and Ethical Considerations by removing the word ‘expertise’ in the third paragraph and replacing it with ‘capacity’. The wording with regard to this issue would be reviewed when compiling production of the new Investment Strategy Statement.