The Fund Director announced that he would be taking the Investment Strategy Review and the Responsible Investment Policies Annual Review together due to the degree of overlap between the two.

Members were informed that due to time sensitivity the Investment Strategy Statement (ISS) must be agreed today, although the ISS could be changed at a later date if required.

There was also a decision to be made in relation to equity protection; this would be dealt with in the private part of the agenda due to it containing market sensitive information.

The report at item 11 set out proposed changes to the strategic asset allocation which, if agreed, would start to be implemented at the beginning of the next financial year, subject to market conditions.

Members’ attention was drawn to paragraph 5.12 of the report which set out the hierarchy which would be used to realise investments in order to pay benefits due to Scheme members.

The proposed implementation process would rely on products that were included within the Border to Coast Delivery Plan.  This could affect the timing of the process, especially in current market conditions.

The paper at item 13a set out a number of policies in the responsible investment area that were subject to regular review; a diagram within the report set out a hierarchy of those policies.

Members discussed the ISS and RI policies in terms of climate change and the apparent lack of urgency of markets and investment houses to address the need of investors to support the ambition of being carbon neutral by 2030.

The Fund Director agreed that there was clearly a need, given Members views, for future debate on how the Authority addressed some of these issues in policy terms.  In the meantime Members could send him any comments or suggestions and officers would look again at the policies in conjunction with the Chair.

Cllr Sangar commented that in terms of the Investment Strategy Statement, he would like the following words removed from the third paragraph of the social, environmental and corporate governance section on page 60 – ‘and, therefore, will not actively invest in or disinvest from companies solely or largely for social or ethical or environmental reasons’ as he felt it didn’t reflect what some Members were trying to achieve in this area.  The sentence would then read: ‘The Authority believes that the pursuit of standards of best practice aligns the interest of Fund members with those of fellow shareholders and with society as a whole’.

After debate it was agreed to remove the sentence as requested.

RESOLVED – That the Authority:

(i)     Endorse the changes to the investment strategy set out in the report, including the changes to Equity Protection set out in Appendix B on the confidential part of the agenda.

(ii)    Approve the revised investment Strategy Statement subject to the amendment described above.

(iii)    Defer approval of the Authority’s:

·         Responsible Investment Policy

·         Climate Change Policy

pending further debate.

(iv)   Approve the updated Policy on Responsible Investment for Commercial Property.