The Pension Fund Investment Sub-Committee of Warwick Council met on Monday, 10 June 2024, to discuss various governance updates, review previous meeting minutes, and address several significant risks and investment strategies. Key decisions included noting the minutes of the Warwickshire Local Pension Board meeting and acknowledging the Pension Fund Governance Update Report.

Pension Fund Governance Update Report

Martin Griffiths, Technical Specialist for Pension Fund Policy and Governance, presented the Pension Fund Governance Update Report. The report provided updated governance information, including details of Warwickshire Pension Fund’s Forward Plan, risk monitoring, policies, and training. Griffiths highlighted the Net Risk Chart, noting that 'Governance Failure' had been upgraded to a red risk to ensure compliance with new legislation introduced by the Pensions Regulator¹. He also thanked members for completing the Knowledge and Skills Assessment, the findings of which would be used to develop the training programme.

The Chair emphasised that climate change was listed as the most severe risk for both impact and likelihood within the Net Risk Chart. Paul Higginbotham, Investment Analyst for Pensions and Investment, stated that the Fund was making continued progress in transitioning to low-carbon investments, with guidance from advisors and collaboration with the Border to Coast Pensions Partnership (BCPP) to reduce carbon impacts. Councillor Sarah Millar noted that recent analysis by the Confederation of British Industry (CBI) indicated that accelerating green growth could lead to increased economic activity, delivering both environmental and economic benefits.

In response to Councillor Brian Hammersley, Griffiths advised that cyber security would remain a red risk due to constantly emerging threats. Higginbotham added that 'Long term asset values do not meet expectations' was also a red risk, acknowledging external factors like war and geopolitical considerations. James Glasgow from Hymans Robertson assured the Sub-Committee that while it was impossible to insure against all market shocks, the Fund was in a good position. Rob Powell, Executive Director for Resources, reiterated the need for vigilance given the volatile economic environment.

Review of the Minutes of the Warwickshire Local Pension Board Meeting

The Sub-Committee noted the minutes of the Warwickshire Local Pension Board meeting held on 30 January 2024. The minutes included discussions on governance, regulatory updates, and performance metrics. Key points included the introduction of a new Cyber Security Policy and updates on the Fund's compliance with the Pension Regulator’s General Code of Practice.

Exclusion of Public for Confidential Discussions

The Sub-Committee resolved to exclude members of the public from the meeting for several items on the grounds that their presence would involve the disclosure of exempt information as defined in paragraph 3 of Part 1 of Schedule 12A of the Local Government Act 1972. These items included a macroeconomic update, quarterly investment monitoring report, cashflow management, commitments to alternative assets, and a presentation from Joe McDonnell, Chief Investment Officer of BCPP.