Northern LGPS has published its Responsible Investment Policy
Submitted by Editor on Thu, 31/01/2019 - 15:55
Northern LGPS, formerly the Northern Pool, has published its ground-breaking Responsible Investment Policy.
Launched at Northern LGPS’ annual stewardship conference at Aintree in Liverpool, the policy details its ambitions for upholding the highest standards of corporate governance at its investee companies, and making investments that deliver financial, social and environmental benefits across the north of England.
The new guidance places Northern LGPS at the forefront of responsible investment, with ambitious targets in terms of its environmental, social and governance (ESG) policies. In particular, it is committed to actively using its scale as a significant shareholder to engage with and influence its largest portfolio companies.
Other key goals include a commitment for 100 per cent of assets to be compatible with the net zero-emissions ambition outlined in the Paris Agreement by 2050. There is also an undertaking to pre-disclose votes on all investee companies, in order to demonstrate accountability to beneficiaries, making Northern LGPS the first major UK institutional investor to adopt this level of transparency.
Councillor Paul Doughty, chair of Northern LGPS, said, “Northern LGPS is determined to be at the forefront of responsible investment. Our assets are invested to fund the retirements of hundreds of thousands of people living in the North and beyond. We will always act in their interests, which is why we want all of our responsible ownership activities to make a positive contribution to the regions where they live.
“We will be demanding high standards from the businesses in which we invest, and will focus our activity on aiding the creation of good jobs, protecting our environment and enhancing infrastructure.”
Alan MacDougall, managing director at PIRC, added, “The policy sets out the strong regional focus of Northern LGPS and emphasises significant ESG themes such as climate change and employment standards. There will be a particular engagement focus on large holdings, and those that pose significant ESG risks to Northern LGPS.
“The policy also makes significant commitments to best practice, such as a stretching decarbonisation target and the pre-disclosure of all votes.”
Northern LGPS is also committed to publishing a quarterly report on the work undertaken in respect of its new policy. In addition, from Q1 2019, it will begin its own responsible investment projects, including a focus on the housebuilding sector.
Northern LGPS is comprised of Greater Manchester, Merseyside and West Yorkshire Pension Funds. Its combined assets now stand at over £45bn, making it one of Britain’s largest asset owners and a major voice in UK and overseas capital markets. It is also one of the largest of the eight Local Government Pension Scheme (LGPS) asset pools set up in a bid to drive down costs and improve efficiencies for its five million members. As such, it is committed to the highest standards of governance, asset safety and transparency in reporting.
