a.    Risk Register

b.    London Collective Investment Vehicle (LCIV)

c.    Pension Fund Governance – Update

d.    Corporate Governance

e.    Employer – Late Payments

The Committee received the report (Report No: 87) of the Executive Director Resources on five standing items as follows: 

a.            Risk Register

NOTED

1.            The updated risk policy and risk register which now includes the impact of moving to a low carbon investment environment.  This has been included as a yellow risk with a high likelihood and a medium impact.

2.            In PEN10 the sentences beginning “The committee will take professional advice ….” And “ Working with the LCIV” to be removed as they were felt to be value judgements rather than risks. 

3.            The importance of having full regard to fiduciary duties was emphasised.

4.            A list of the companies in which the Pension fund invests was requested. 

5.            The register would also be updated to include the risks associated with BREXIT. 

AGREED to approve the register subject to the above changes. 

b.            LCIV (London Collective Investment Vehicle

NOTED

1.            The information provided on the background to the London CIV and the pooling arrangements mandated by the Government.

2.                  The change to the governance structure so that instead of the joint committee formed by the LGA that existed previously, there is now a shareholder committee made up of representatives from 12 members of the London local authorities including 8 pension chairs and 4 treasury officers.  The current chair is Cllr Yvonne Johnson from Ealing Council. 

3.                  There are eight regulated fund management entities.

4.                  Enfield has pooled about 40% of their funds.

5.                  The LCIV is considering responsible investment vehicles. 

6.                  The operating and business models have recently been extended.

7.                  The London boroughs have expressed some concern about the renumeration and pension arrangements of the LCIV staff.  The staff are paid market rates and have access to the Local Government Pension Scheme. 

8.                  There were some reservations about the LCIV and about the amount of money invested already, the open-ended commitment on the pensions arrangements, and whether the ethical LCIV investment offer would be appropriate to Enfield’s needs. 

9.                  The LCIV and similar pools were set up as mandated by Government and were seen as a way to pool resources and achieve economies of scale.  They will take time to be successful.  The trustees need to reflect on the risks and act accordingly.  Any risks should be added to the risk register. 

10.              There was also concern about the governance arrangements and about the ability of the trustees to hold the LCIV to account.

AGREED

1.            To note the contents of the report

2.            To update the risk register

3.            To report the reservations of the committee to the LCIV

4.            To commit no further investments into the LCIV until the concerns of the committee were addressed.

c.            Pension Fund Governance – to be discussed later on the agenda. 

d.            Corporate Governance

NOTED

1.            The dashboard showing progress made on outstanding requirements on the Pension regulators compliance checklist.

2.            There has been a general improvement from 57% compliant to 76% but there are still areas which are judged to be non-compliant or partially compliant.

3.            There was concern about the lack of compliance in areas of record keeping, data management and the training of board members.

AGREED that

1.    The risk register should be updated to include the risks of partial and non-compliance.

2.    The governance arrangements should be updated and a presentation provided on how to meet compliance.  If extra resources were needed, they should be provided. 

e.            Employer late payments

NOTED that one of the outstanding issues had already been resolved.

f.             Training

NOTED

1.            The proposal that training should be added to the standing items each meeting and a training programme developed that would be assessed annually.  The Vice Chair would monitor training.

2.            A brief training session could be held before each meeting. 

3.            CIPFA had a framework that a lot of authorities followed.

4.            Everyone was recommended to sign up to the regulator tool kit.

5.            Councillor Neville offered to obtain a copy of a training assessment form used by Westminster and send it through to Gareth Robinson

AGREED

1.         To add training as a standing item for each meeting.