Issue - meetings

24.1     The Board considered a report providing an update on various governance workstreams completed and changes affecting the LGPS and the ESPF.

24.2     Sian Kunert (SK) drew the Board’s attention to the following:

1) The Fund submitted a response to the letter from the Minister for Local Government in May. The Fund must respond to the subsequent call for evidence and a copy will be circulated to the Board and will be provided at the Pension Committee meeting later this month. The request for evidence went to all pools with a short response time. 

2) It is key that the effectiveness of the pool and how well it is working is highlighted in response to the risk the review poses to the Fund.

24.3     NS highlighted that it is challenging to present factual data to provide an accurate picture of the current position of the fund. SK confirmed that the different funds work within the same framework but do have differing ways of working and reporting.

24.4     NS asked about the potential merits of the review. SK confirmed that officers welcome the review and the focus on the LGPS as it is a more affordable scheme for employers and that they expected some positive outcomes as a result of the review.

24.5     AW asked if the ESPF had reviewed the opportunity costs that the Fund could be exposed to if it were required to put 100% of all assets through the Pool. SK confirmed that the Pool is doing a lot of work to bring on new products but does currently lacks the full set of asset classes which the Fund wants to invest in. There are more products which are expected to be added for instance in private equity and a private credit tender has gone out so progress is being made. The pool picks the manager however ESPF is part of the pool and it is a collaborative approach and the views and requirements of the Fund are considered. When Storebrand is brought online then the allocation outside of the pool will be less that 15%.

24.6     The Board considered the Conflict of Interest Policy and requested that officers make the following changes:

1) The first sentence of the second paragraph of the policy will be in bold to highlight the fiduciary obligations that Committee members have.

2) The potential conflict between political views and acting in the best interest of the Fund will be included in the list of examples of conflicts of interest

3) The potential conflict between public law and fiduciary duty and obligations to local taxpayers will be included in the list of examples of conflicts of interest

24.7     The Board RESOLVED to note the Governance report.