Issue - meetings

66.1     The Committee considered a report introduced by Russell Wood drew the Committees attention to the following points:

PRI

1)    The Summary Scorecard gives an overview of the Fund’s scores against the PRI median score. The Scorecard is shown below and indicates that there are still areas where the Fund can improve but that it is currently performing above the median PRI score on all areas. One item which couldn’t be completed but this will be resolved for next year’s submission.

Stewardship Report

2)    The Fund is pleased to confirm that it has maintained its status as a UK stewardship code signatory. The Stewardship report is now on our website along with notification that the Fund are still signatories.

CMA

3)    With the introduction of the new Investment Consultancy contract with Hymans Robertson, the Pension Committee are asked to review and approve the strategic objectives that have been set for Hymans Robertson under their new contract which are set out at Appendix 4 of the report.

Scheme Advisory Board

4)    Counsel Opinion was sought in on the implications of the current events in Gaza on LGPS, the opinion sets out that there is no potential prosecution that can be made with regard to the Fund’s investments.

5)    The SAB has now received Nigel Griffin KC’s updated opinion on the fiduciary duty in the context of the LGPS, there have not been any changes in respect of what has been published so far in respect of the reforms.

66.2        Iain Campbell (IC) drew the Committees attention to the following points:

1)    The Committee welcomed the new format and noted that Hymans are happy to tailor the report as required.

2)    Since the last reported position, the valuation of the Fund has increased from £4.917bn as at 30 September 2024 to £5.070bn as at 31 December 2024 (an increase of£95m). This performance reflects a positive absolute return of 2.0% in the quarter to December 2024. The Fund, however, underperformed the benchmark in the period by 1.6%.

3)    Performance of Fund assets is similarly behind benchmark over longer time periods. Over the past 12 months and 3 years the Fund has relative returns of - 4.3% and - 3.1% p.a. respectively.

4)    Year-on-year headline CPI inflation rose in Q4,2024 to 2.9%, 2.5% and 2.4%, in the US, UK and eurozone, respectively, largely due to a smaller negative impact from energy prices relative to last year’s sharp declines. Core inflation, which excludes volatile energy and food prices, was little changed, but remains above headline measures, at 3.2% in the US and UK, and 2.7% in the eurozone.

5)    US 10-year yields rose 0.8% pa to 4.5% pa, driven by strong growth, expectations of a more inflationary policy mix under Trump, and anticipated higher bond issuance to fund tax cuts. UK 10-year gilt yields rose 0.6% pa to 4.6% pa, spiking after the Autumn 24 Budget, as investors digested a likely slower pace of rate cuts and higher gilt issuance. French 10-year yields rose 0.3%  ...  view the full minutes text for item 66