The Pensions Panel of Staffordshire Council met on Tuesday 2 June 2026 to review the fund's investment performance and responsible investment strategies. Key decisions included noting the Responsible Investment and Stewardship (RI&S) report for the quarter ending 31 March 2026 and approving the Annual Investment Strategy for Pension Fund Cash for 2026/27.

Responsible Investment and Stewardship (RI&S) Report

The Panel received the RI&S report for the quarter ending 31 March 2026, which detailed the fund's commitment to integrating Environmental, Social, and Governance (ESG) considerations into its investment decisions. The report highlighted the fund's continued signatory status to the UK Stewardship Code, an achievement noted as being attained by only a minority of Local Government Pension Scheme (LGPS) funds.

The report included updates on engagement activities undertaken by the Local Authority Pension Fund Forum (LAPFF). Key engagements discussed included:

• Climate Change Adaptation: LAPFF engaged with food producers and distributors such as Sainsbury's, Associated British Foods (ABF), Danone, Marks and Spencer (M&S), and Nestlé to encourage companies to identify and disclose financially material physical climate-related impacts and their adaptation measures. The Panel noted the progress made by Sainsbury's in embedding supply chain resilience and Danone's commitment to regenerative agriculture.
• Water Utilities: Engagement with Pennon focused on pollution from storm overflows, upgrades to infrastructure, and emerging risks from per- and polyfluoroalkyl substances (PFAS). Pennon reported improvements in its 'Upstream Thinking' catchment programme and progress on storm overflow reductions, though the Panel noted ongoing challenges and heightened scrutiny following incidents like the cryptosporidium outbreak in Brixham.
• Aviation: LAPFF met with major European airline groups, including Ryanair, International Consolidated Airlines Group (IAG), Wizz Air, and easyJet, to discuss their decarbonisation strategies and plans for scaling Sustainable Aviation Fuel (SAF). Ryanair highlighted systemic challenges in the European SAF market, while IAG detailed fleet modernisation and improved supplier engagement. Wizz Air emphasised its young fleet and investments in SAF innovation, and easyJet outlined its Reduce, Replace, Remove framework.
• Zero-hours contracts and Employment Rights Act: Engagements with InterContinental Hotels Group (IHG) and Mitie Group (Mitie) assessed their preparedness for changes to UK employment law. IHG confirmed it does not operate zero-hours contracts in its directly managed operations, while Mitie noted potential operational impacts and concerns regarding Day 1 unfair dismissal rights.
• Conflict-Affected and High-Risk Areas (CAHRAs): LAPFF wrote to 31 companies with operations linked to the Occupied Palestinian Territories to gather information on their policies and due diligence processes. The Panel noted that responses were under review and further engagement with companies like Motorola Solutions had taken place.
• Electric Vehicles: LAPFF continued its engagement with General Motors (GM) regarding human rights and supply chain risks associated with electric vehicle production, noting GM's progress in mapping its supply chain and consulting with NGOs.

The Panel also noted the draft LGPS Central Quarterly Stewardship Report for Quarter 4 2025.

Fund Performance and Portfolio of Investments

The Panel received a summary of the Staffordshire Pension Fund's performance as at 31 March 2026. The fund's market value was £8.401 billion, a decrease of approximately £108 million from the previous quarter. For the quarter ending March 2026, the fund returned -1.13%, underperforming its strategic benchmark of +0.15% by -1.28%. Equities were identified as the lowest performing asset class in absolute terms and against the benchmark, while the property portfolio was the best performing. Longer-term, the fund's annualised returns since inception stood at +7.85% per annum, exceeding the actuary's investment return assumption of 5.9%. The detailed portfolio of investments as at 31 March 2026 was provided in Appendix 1.

Investment Consultant and Independent Investment Adviser Objectives Review

The Panel reviewed the objectives set for the fund's Investment Consultant, Hymans Robertson, and its Independent Investment Advisers for the 2025/26 financial year. The report indicated that the desired outcomes for these objectives had been met. The Panel also noted the upcoming transition where LGPS Central would become the fund's Principal Investment Adviser, following the Pensions Bill 2026. Given the ongoing uncertainty and phased transition, it was deemed appropriate to set objectives for Hymans and the Independent Investment Advisers for one further year in 2026/27.

Annual Investment Strategy for Pension Fund Cash

The Panel approved the Staffordshire Pension Fund's Annual Investment Strategy (AIS) for the investment of internally managed cash for 2026/27. The strategy, prepared in line with the principles of the CIPFA Treasury Management Code of Practice, focused on liquidity as a priority, with Money Market Funds (MMFs) being the primary investment vehicle. The Panel also approved the continued delegation to the Section 151 Officer to determine suitable investment vehicles, values, and allocations for cash.

Exclusion of the Public

The Panel resolved to exclude the public from the meeting for subsequent agenda items, which involved the likely disclosure of exempt information relating to minutes, strategic asset allocation, fund performance, and LGPS Central updates.

Decisions Made:

• Recommendations Approved regarding the Exclusion of the Public.
• The content of the Responsible Investment and Stewardship report for the Quarter Ended 31 December 2025 (Q4 2025), was noted.
• The Local Authority Pension Fund Forum Q4 2025 Quarterly Engagement Report (Appendix 1), was noted.
• The Local Authority Pension Fund Forum (LAPFF) 2025 Annual Report (Appendix 2), was noted.
• The draft LGPS Central Quarterly Stewardship Report Quarter 4 2025 (Appendix 3), was noted.
• The Staffordshire Pension Fund's Annual Investment Strategy for the investment of internally managed cash in 2026/27, was approved.
• The 2026/27 Investment Adviser Objectives for Hymans Robertson, as shown in Appendix 1, were approved.
• The 2026/27 Investment Adviser Objectives for the Pension Fund's Independent Investment Advisers, as shown in Appendix 2, were approved.
• The upcoming ratification of the Pensions Bill 2025 by the government and issuance of final guidance, which will lead to LGPS Central becoming the Fund's Principal Investment Adviser, was noted.
• It was noted that, given the uncertainty in the structure of the Fund's investment advice going forwards and the phased transition of principal advisory services to LGPS Central that will occur, it is deemed appropriate to set investment objectives in the current format for Hymans and the Independent Investment Advisers, for one further year in 2026/27.
• The public were excluded from the meeting for subsequent agenda items.

Attendees:

• Sean Bagguley (Cabinet Member for Finance and Resources)
• Andrew Clissett
• Chantelle Denham
• Colin Greatorex (Shadow Portfolio Holder for Health and Care)
• Robin Hall (Cabinet Member for Economy and Skills)
• Simon Humble
• Craig Humphreyson

Key Documents:

• Responsible Investment & Stewardship (RI&S) Report for the quarter ended 31 March 2026
• Portfolio of Investments as at 31 March 2026
• Investment Consultant and Independent Investment Adviser Objectives Review 2025/26
• LAPFF Q1 2026 Quarterly Engagement Report