Agenda and minutes

To confirm the Minutes of the meeting held on 25 November 2020.

RESOLVED:

THAT the Minutes of the meeting held on 25 November 2020 be confirmed.

To invite Members to declare any interest they might have in the matters on the agenda.

No new declarations were received at this stage.

Questions must be delivered by electronic mail to democratic.services@iow.gov.uk no later than 10.30am on Friday 22 January 2021. Each question must give the name and address of the questioner.

No public questions were received.

To record the decision from the selection panel on 4 December 2020 for the Infrastructure allocation.

The Technical Finance Manager presented the report which recorded the decision from the Infrastructure Investment Solution selection panel on 4 December 2020. It was confirmed that discussions had begun with Partners Group in advance of the Committee’s ratification of the decision, and the Fund had been accepted as a professional investor under MiFID II. The relevant paperwork had been circulated for completion and initial indications anticipated that the first investment would be required in mid-March 2021.

Discussion took place regarding the move from non-professional to professional investor status and confirmation was sought that this move was justified for the Fund. Members were reassured that this was a standard procedure for a pension scheme.

Following discussion, a vote was taken and it was:

RESOLVED:

THAT the selection of the Partners Group Direct Infrastructure 2020 fund for the delivery of the fund’s infrastructure allocation be approved.

To note the progress made in implementing the fund’s private debt investment allocation.

The Technical Finance Manager presented the report which advised on the progress made in implementing the fund’s private debt investment allocation. Members were advised that the first investment was made to GSAM on 25 January 2021 which equated to 25 per cent of the fund’s commitment to this asset class. This was funded by a disinvestment from Majedie the amount of which allowed sufficient flexibility to cover movement in exchange rate (with added uncertainty given the timing linked to the US presidential inauguration). It was confirmed that the remaining disinvested balance would be used to support the ongoing day-to-day operations of the fund.

Discussion took place regarding the foreign exchange rate and questions were raised with regards to deadlines and sufficient time to notify disinvesting managers. It was confirmed that future reports would be presented to the committee with regards to infrastructure and private debt investment.

RESOLVED:

THAT the progress towards the fulfilment of the private debt investment allocation be noted.

To note the submission of the annual compliance statement under the Investment Consultancy and Fiduciary Management Market Investigation Order 2019.

The Technical Finance Manager presented the report which asked the Committee to note the submission of the annual compliance statement for the period 10 December 2019 to 9 December 2020, in accordance with the Investment Consultancy and Fiduciary Management Market Investigation Order 2019 issued by the Competition and Markets Authority (CMA). Members were advised that the order included the setting of strategic objectives for investment consultants and required a compliance statement to be submitted annually confirming that the fund had complied with the relevant parts of the order.

Members were advised that the compliance statement had been submitted in line with the appropriate timetable, and that the Committee’s workplan included consideration of the objectives for investment consultants and a performance review at the meeting to be held in March 2021. Members wished to formally thank the Technical Finance Manager for the efforts on this.

RESOLVED:

THAT the completion and submission of the compliance statement, in accordance with the required deadlines, be noted.

To note the 2021-22 meeting dates for the pension fund committee and to agree the timing of future development sessions.

The Technical Finance Manager presented the report which reminded members to note the 2021-22 meeting dates of the Committee and sought agreement for the timing of future development sessions.

Members were advised that the workplan was in development and would be  supplemented by discussions at the meeting of the Pension Board 24 March 2021, where the Board would consider the Funds policies and other strategic documents to determine an appropriate review schedule.

Discussion took place regarding the preferred methods of receiving future development sessions, both virtually and face-to-face. It was agreed that the Technical Finance Manager would contact members of the Committee and Board; to identify a date and time for the rescheduled ESG/RI workshop, and to provide feedback on the timings of future development workshops.

RESOLVED:

THAT the agreed schedule of meeting dates for the council year 2021-22, and the draft work plan for those meetings, be noted.

To note items circulated to committee members since the papers were published for last committee meeting (17 November 2020), for information:

a)    Sent 18-Nov-20: Hymans Robertson Current issues in the LGPS.

b)    Sent 27-Nov-20: AON webinar replays - Cyber risk in the LGPS.

c)    Sent 04-Dec-20: Hymans Robertson webinar invitation: keeping the LGPS connected (9 Dec).

d)    Sent 04-Dec-20: Webinar invitation: Covid-19 and what next for the LGPS?

e)    Sent 08-Dec-20: Your December issue of The Edit.

f)      Sent 14-Dec-20: LGPC Bulletin 204 - December 2020.

g)    Sent 21-Dec-20: Hymans Robertson webinar invitation: keeping the LGPS connected (12 Jan).

h)    Sent 22-Dec-20: LGA webinar invitation: LGPS Update 26 January 2021.

i)      Sent 22-Dec-20: Confirmation of account opening with Goldman Sachs for private debt.

j)      Sent 12-Jan-21: ACCESS joint committee meeting agenda and papers.

The committee noted the items circulated for information since papers were published for the last meeting. Attention was drawn to the fortnightly Hymans Robertson ‘keeping LGPS connected’ webinars. No questions or comments were raised at this stage.

RESOLVED:

THAT the items circulated for member’s attention be noted.

A question must be submitted by electronic mail to Democratic Services no later than 10.30am on Monday 25 January 2021.

No members’ questions were received.

To consider passing a resolution that, under Section 100(A)(4) of the Local Government Act 1972, the public and press be excluded from the meeting for the following item of business, namely agenda item 13, on the grounds that there is likely to be disclosure of exempt information as defined in paragraphs 3 of Part 1 of Schedule 12A of the Act and in all the circumstances of the case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information.

RESOLVED:

THAT the public and press be excluded.

At the conclusion of the discussion, members adjourned for a 10-minute comfort break.

To receive a report from Hymans Robertson on progress with equity investment rebalancing.

Equity Investment Rebalancing and the UBS Presentation were considered together, per below:

To receive a presentation from UBS.

The Investment Consultant at Hymans Robertson presented the report which outlined the progress with regards to equity investment rebalancing. The Committee was asked to receive a presentation from UBS and to reaffirm the decision taken at the meeting on 25 November 2020; to invest 18.75 per cent of the fund’s total investments into the UBS passive equity climate aware fund.

Members received and considered a confidential presentation from UBS on their Climate Aware Equity Strategy which included an overview of the investment process and the climate aware engagement strategy.

Following consideration, a vote was taken, and it was:

RESOLVED:

i)               THAT the confidential presentation from UBS on their Climate Aware fund be noted.

ii)              THAT the introduction of a new allocation of 18.75 per cent to the UBS Climate Aware fund (funded 5 per cent from Majedie and 13.75 per cent from Newton) be agreed.

iii)            THAT officers be authorised to begin the process necessary to fulfil this investment, working with Hymans Robertson to develop and implement the necessary transition plan.

To receive a report from the ACCESS Joint Committee meeting held on 13 January 2021, and to note progress on the transition of the fund’s investment assets into the ACCESS pool.

The Technical Finance Manager presented the report from the ACCESS Joint Committee meeting held on 13 January 2021, and members were asked to note progress on the transition of the fund’s investment assets into the ACCESS pool.

Following discussion, a vote was taken, and it was:

RESOLVED:

i)               THAT the ACCESS update be noted.

ii)              THAT, subject to the recommendation from the ACCESS Joint Committee, the committee adopts the ACCESS business plan and budget for 2021-22.