The Head of Responsible Investment presented the report which provided an update on the Responsible Investment (RI) activity and reporting of the company.

Members questioned how often Border to Coast review DPI and climate action change data to ensure it is still fit for purpose with reference to the 3-year Engagement Strategy.

The Head of RI responded that the data is robust and used on an ongoing basis, however there isn’t a fixed cycle for reviewing these data sources. A Net Zero implementation plan is in place, and Border to Coast hope to revisit it in the next 1-2 years.

Members further questioned whether Border to Coast have any input into TPI and The Climate Action 100.The Head of RI responded that Border to Coast is a member of both initiatives. These initiatives are shaped by the membership which feeds into the decision making.

Members sought clarification on the alternative approaches available if engagement is not leading to desired outcomes.

The Head of RI responded that Border to Coast have published research supporting their engagement as a means to enact change. There were plans to further clarify escalation routes within their RI policies, focusing on effective ways to hold companies accountable. The aim is to promote accountability through constructive engagement and responsible stewardship, rather than divestment, which they do not consider an investment strategy.

Members probed whether our votes against resolutions were in isolation or part of a collaborative effort and whether Border to Coast are positioned as an influencer or shaper in this.

The Head of RI responded that Border to Coast vote in accordance with their guidelines alongside using other engagement tools, including collaborative initiatives with other investors. Where appropriate, Border to Coast also pre-declare their voting intentions to ensure companies clearly understand the rationale behind decisions. They are selective in their influence, prioritising areas where risks are most material and where they are best positioned to exert meaningful influence.

The Chair questioned whether we are truly having an impact through collaboration, particularly among institutional investors. They asked whether a collaborative approach is genuinely taking shape by default, and if it is effective. The Chair also noted that if pressure is growing, and we are the only ones taking a certain position, we risk remaining isolated.

The Head of RI responded that as long-term investors, our funds bring a perspective that may differ from that of companies with shorter-term outlooks. Through engagement, we ensure that the voice of the long-term investor is represented in strategic discussions.

A Member sought assurance on whether the committee had established a definitive timeline for reviewing our policy position.

The Head of RI responded that the decision rests with Border to Coast, but with consultation with Partner Funds, noting that the policies will also come to the Joint Committee for endorsement at its next meeting.

The CEO added that a workshop will be conducted with the committee prior to the meeting, noting that they have been successful in discussing views every year. As part of the due diligence process for candidate funds, Border to Coast reviewed their RI policies to ensure they align broadly with theirs and to date, have not identified any significant outliers.

A Member queried point 7.2 of the report, asking what the lowering of thermal coal power generation exclusion thresholds is intended to achieve, and how it might impact our investments.

The Member further questioned how this approach aligns with the global context, noting that countries such as China and India continue to rely heavily on coal-fired power generation, and how this policy guides our investment decisions, especially regarding companies sourcing materials from these regions.

The Head of RI responded that this is an exclusion based on the likelihood of company involvement. The potential impact of raising the threshold is limited, as it currently applies to only one company within the portfolio and represents a small holding.

RESOLVED – Members noted the report.