Agenda and draft minutes

Pension Policy & Investment Committee - Wednesday, 18th January, 2023 10.00 am

Venue: Conference Room, Civic Centre, Silver Street, Enfield, EN1 3XA. View directions

Contact: Bola Tobun - Finance Manager (Pensions and Treasury) - 020 8132 1588 - Email: bola.tobun@enfield.gov.uk 

Items
No. Item

1.

WELCOME AND APOLOGIES

Minutes:

The Chairman welcomed everyone to the meeting.

 

Apologies for lateness were received from Cllr Tim Leaver.

 

2.

DECLARATIONS OF INTEREST

Members of the Board are invited to identify any disclosable pecuniary, other pecuniary or non-pecuniary interests relevant to the items on the agenda.

Minutes:

There were none received.

3.

MINUTES OF PREVIOUS MEETING pdf icon PDF 137 KB

To agree the minutes of the meeting held on 23 November 2022.

Minutes:

The minutes of the meeting held on 23 November 2022 were agreed with the following amendments;

 

To correct number sequencing on item 5. Members confirmed the following decisions and actions:

A.        In line with the strategic asset allocation, officers should now give notice to redeem all hedge fund investments

B.        £40m of the cash being held to be invested in bonds: £20m Western and £20m AON  

 

ACTIONS:

·         Bola to send correspondence from item 3 to members.

·         Bola to send Glossary of Acronyms to members and to Local Pension Board Members.

 

The Chair requested a part 2 minute for item 5 and circulate to members.

 

Members requested timeline for actions on minutes going forward.

4.

CHAIRS UPDATE

To receive an update from the Chair.

Minutes:

The Chair requested a quarterly update for the Committee which provides an indication on the change in numbers for people choosing to leave the Pension scheme.

 

The minutes from the previous Local Pension Board meeting show the board members queried the need for enhanced DBS checks on members of the Pension, Policy and Investment Committee.

 

The committee agreed that they are happy to undertake an enhanced DBS check  due to the understanding that only enchanched DBS checks provide information on fraud related offences, which may be relevant.

 

ACTIONS:

·         Robyn to raise DBS request to Governance Manager.

·         Officers to provide Quarterly update to the Committee on the number of people choosing to leave the Pension scheme to be added to the forward plan

·         Bola to arrange for Chief Exec of LCIV to attend PPIC

5.

Responsible Investment Workshop pdf icon PDF 70 KB

This one hour workshop will cover:

 

(i)            Key concepts and the direction taken by the Fund thus far

 

(ii)          Outline of the Fund’s potential next steps and ‘roadmap’ of the way forward (for example, in light of the net-zero aspiration discussed with the Committee previously, what this implies in terms of actions and next steps to align with this). This will allow the Committee to identify the preferred direction and speed of travel, and inform what happens next

 

(iii)         Overview of activity within other LGPS, both within the London CIV pool and more broadly across England and Wales. This will contextualise where the Fund’s priorities are shared with other peer group schemes, and allow the Committee to see the themes of activity taking place across the wider landscape. There has been a lot of activity in this area since the Committee last had this discussion, therefore this is a timely opportunity to revisit this with the Committee.

 

Additional documents:

Minutes:

Jennifer O’Niell, CFA Associate Partner - Aon, lead the workshop.

 

Members raised questions on executive compensation in particular the use of tax havens. Jennifer explained that this is included within ESG, most shareholders would not necessarily have an issue with the use of creative taxation structures.

 

Members asked what could be done be become aligned with shareholders. Jennifer suggested to look at how the managers are discharging their rights over time and what the results of this are. The Independent Advisor added that a key role of the CIV is to scrutinise the fund managers on our behalf. The Committee could think about becoming signatory to the Stewardship Code although it was confirmed this is not the norm.

 

Aon’s view is that the market might be under-pricing climate risks. This can be mitigated by some types of investments.

 

The Committee want to focus on practical steps to achieve the carbon neutrality targets set. Members commented that they recognise there are challenges in responsible investment which result in a lack of clarity for the objectives.

 

ACTION: At the next PPIC meeting, the Committee want to agree practical steps to progress responsible investment.

 

6.

ECONOMIC, MARKET AND INVESTMENT UPDATE pdf icon PDF 807 KB

Members will receive a verbal update.

Minutes:

Colin Cartwright, Partner- Aon, presented this item highlighting the key points, explaining that 2022 had been a bad year for major asset classes. The recent rally has been sharp but may not last and is expected to peak within the next 3-6 months. Fed funds rate is expected to peak at 5%, whilst rate cuts are priced in towards the end of 2023.

 

Bailey Gifford significantly underperformed last year. Aon’s research team met with them in quarter four last year and will communicate the outcome of this at the next meeting.

 

ACTION: Aon to provide annual comparison on fund for the past 12 months and Bola to send to the committee when the end of December data is ready.

 

 

 

 

 

7.

Draft Pension Fund Business & PPIC Work Plan for 2023/24 - TO FOLLOW

Members will receive a verbal update.

 

Minutes:

The Chair requested a short note to be circulated to the Committee for this item as a report was not submitted.

 

Cllr Smith raised concern on the importance of including reports in agendas, the meetings needs to be practical and focus on decisions to be made.

 

ACTION: Bola to circulate short note on this item to the committee.

8.

Review of Governance Compliance Statement - TO FOLLOW

This item has been deferred to the next meeting.

Minutes:

The Chair requested a short note to be circulated to the Committee for this item as a report was not submitted.

 

ACTION: Bola to circulate short note on this item to the committee.

 

9.

Enfield Pension Fund Administrative Key Performance Indicators Report - TO FOLLOW

Members will receive a verbal update.

 

Minutes:

The Chair requested a short note to be circulated to the Committee for this item as a report was not submitted.

 

ACTION: Bola to circulate short note on this item to the committee.

 

10.

Review of Reporting Breaches Policy and Conflicts of Interest Policy - TO FOLLOW

This item has been deferred to the next meeting.

Minutes:

The Chair requested a short note to be circulated to the Committee for this item as a report was not submitted.

 

ACTION: Bola to circulate short note on this item to the committee.

 

11.

Minutes of Pension Board Meeting of 15th December 2022 pdf icon PDF 139 KB

To note the minutes of the last pension board meeting held on 15 December 2022.

Minutes:

NOTED the minutes of the Pension Board meeting of 15 December. Issue raised on DBS checks was discussed in item 4, Chairs briefing.

12.

Compliance with CMA - Investment Consultancy and Fiduciary Management Market Investigation Order 2019 - TO FOLLOW

Members will receive a verbal update.

 

Minutes:

The Chair requested a short note to be circulated to the Committee for this item as a report was not submitted.

 

ACTION: Bola to circulate short note on this item to the committee.

 

13.

Working-group tasks - TO FOLLOW

Members will receive a verbal update.

 

Minutes:

The Chair requested a short note to be circulated to the Committee for this item as a report was not submitted.

 

ACTION: Bola to circulate short note on this item to the committee.

 

14.

AGM Planning

Members will receive a verbal update.

 

Minutes:

Bola Tobun confirmed the agenda would be similar to the previous years AGM.

 

The Chair explained it would be good for members to attend.

 

Support would be needed from Governance to run the event.

 

Cllr Edward Smith passed on his apologies for the AGM meeting in March.

 

ACTION: Bola to invite auditors to the AGM.

15.

DATES OF FUTURE MEETINGS

The date of the next meeting will be held on:

 

Wednesday 29 March

Minutes:

NOTED the dates of the future meetings:

 

Wednesday 29 March