Our approach to responsible investments is set out in the Fund’s responsible investment framework, which is attached to this page.

We aim to incorporate environmental, social and governance (ESG) considerations into investment decisions to better manage risk and generate sustainable, long-term returns.

We use a three pillar approach to responsible investment, which covers:

  • the selection of investments (ensure that ESG factors are taken into consideration when investments are chosen for the Fund)
  • stewardship activities (voting on shareholder resolutions and engaging with companies that the Fund invests in)
  • transparency and disclosure (keeping stakeholders informed about the Fund’s responsible investment activities)

We support a strategy of engagement with companies to influence behaviour and enhance shareholder value. We aim to increase the effectiveness of engagement by working collaboratively with other investors and bodies.

Local Authority Pension Fund Forum (LAPFF)

Membership of the Local Authority Pension Fund Forum (LAPFF) helps us to engage with companies to understand relevant issues, and to promote best practice. Collective pressure from investors via organisations such as the LAPFF helps to encourage listed companies to:

  • enhance their corporate governance
  • improve their environmental impacts
  • improve their social impacts

LGPS Central Pool

Following the launch of the LGPS Central Pool, an increasing portion of the fund’s investments will be transitioned into products managed by LGPS Central Limited. The company has developed a Responsible Investment and Engagement Framework. It incorporates the responsible investment beliefs of the pension funds within the LGPS Central Pool, which will be applied to both internally and externally managed investments. LGPS Central Limited has appointed Hermes EOS to expand the scope of its engagement activities.

The UK Stewardship Code

The Fund is a signatory to the UK Stewardship Code 2020. The UK Stewardship Code 2020 sets high stewardship standards for those investing money on behalf of UK savers and pensioners, and those that support them.  Stewardship is the responsible allocation, management and oversight of capital to create long-term value for clients and beneficiaries leading to sustainable benefits for the economy, the environment and society.  A copy of the Fund’s application document is attached to this page.

Climate Strategy

We recognise the potential material effect of climate change, and the response to climate change on the assets and liabilities of the fund.

Our climate strategy sets out the Fund’s approach to addressing the risks and opportunities related to climate change.

Climate-related disclosures report

We’ve published a climate-related disclosures report using a framework recommended by the Task Force on Climate-related Financial Disclosures. You can go to our climate-related financial disclosures page for more information.