The Pensions Committee of Tower Hamlets Council is scheduled to consider a motion regarding the divestment and exclusion of certain companies from the Pension Fund's investments. The committee will review analyses of the fund's exposure to companies identified on various screening lists and discuss potential approaches to managing these investments.

Pension Fund Divestment and Exclusion Considerations

A key item on the agenda is the Tower Hamlets Council Motion - Pension Fund Divestment and Exclusion Considerations . This discussion stems from a motion passed by the Full Council on 22 July 2026, which called for an analysis of the Pension Fund's holdings in companies appearing on five specified screening lists. These lists include the UN Office of the High Commissioner for Human Rights (UNOHCHR) database, the Boycott, Divestment and Sanction (BDS) National Committee, Who Profits Research Center, the American Friends Service Committee (AFSC), and the UN Special Rapporteur's Economy of Genocide report.

The report pack indicates that London CIV and Marsh (previously Mercer) have conducted confidential analyses of the Pension Fund's underlying exposure to companies on these lists. The committee is expected to note the content of these analyses, which include methodology, limitations, portfolio-level exposures, and implementation considerations.

The committee will also consider previous resolutions, including the Pensions Committee's own resolution from 30 July 2026, which supported the Council motion and requested an assessment of the Pension Fund's exposure to companies complicit in human rights violations, with a view to divesting from such companies with reference to the UN list.

The report highlights the fiduciary duty of the Pensions Committee to act in the best interests of its members, ensuring that all decisions align with this responsibility and are financially prudent. It also notes that decisions concerning the investment of Pension Fund assets must be taken through the statutory Local Government Pension Scheme (LGPS) governance arrangements.

The committee is being asked to consider a proposed approach that involves a targeted response to the UNOHCHR database, with London CIV being requested to develop an implementable plan. For the other four lists, the proposal is to treat them as potential research and due diligence inputs rather than automatic exclusion rules, pending further work. This would involve London CIV modelling credible options, including enhanced engagement, revenue- or activity-based thresholds, watchlists, targeted exclusions supported by verified evidence, and mandate-specific approaches.

The report also suggests that special training be arranged for the Pensions Committee and the Pension Board, covering topics such as fiduciary duties, ESG policy, engagement strategies, legal opinions, and divestment options.

The report pack includes appendices containing the Full Council motion, the Pensions Committee resolution, confidential papers from London CIV and Marsh, legal opinions from Nigel Giffin KC, the current Investment Strategy Statement (ISS), and statutory guidance on preparing an ISS. The committee is also to note the Sustainability Survey Questionnaire supporting the Fund's consultation with scheme members.

The agenda also includes a standard item for declarations of interests, where members are reminded to consider the categories of interest identified in the Code of Conduct for Members. The committee may also consider excluding the press and public from parts of the meeting where exempt information is discussed.