The Pensions Advisory Panel met on Wednesday 23 September 2026 to discuss a range of matters concerning the Southwark Pension Fund. Key topics included updates on investment performance, responsible investment initiatives, governance, and operational matters. The meeting also covered the proposed business plan and training strategy for the upcoming year.

Investment Update

The panel was scheduled to receive an update on the Southwark Pension Fund's investment portfolio for the quarter ended 30 June 2026. The report indicated a market value increase of £213.2m, reaching £2,643.6m, largely driven by strong equity markets. The Fund's return for the quarter was 9.1%, exceeding the benchmark return of 8.1%. However, the year-to-date return of 6.9% was slightly below the benchmark of 7.1%, and the three-year return of 9.2% per annum lagged the benchmark of 12.1% per annum. The report detailed the asset allocation as of 30 June 2026, showing an overweight position in Global Equities (56.4%) and an underweight position in Multi-Asset Credit (8.9%) and Property (14.5%). Specific manager performance was also to be reviewed, with notable positive returns from Newton Active Global Equity and Comgest Emerging Markets Plus. Concerns were raised regarding the performance of property and ESG Priority Allocation portfolios over the full year.

Investment Adviser Updates

The panel was also set to receive updates from investment advisers. David Cullinan's independent adviser's report and Aon's quarterly investment dashboard for the quarter ended June 2026 were scheduled for review. These reports would provide further detail on market conditions, Fund positioning, and manager performance.

Responsible Investment Update

An update on the Fund's responsible investment activities for the quarter ended 30 June 2026 was scheduled. This included a report on the Fund's carbon footprint, which showed a 4% decrease in Weighted Carbon Intensity (Scope 1 and Scope 2) compared to the previous quarter, representing an approximate 80% reduction since the September 2017 baseline. The update also covered engagement and voting activity, with case studies detailing efforts on climate risk, human rights, and board effectiveness.

Exclusions Framework Next Steps

The panel was to be briefed on the next steps for the Fund's Exclusions Framework, which was incorporated into its Responsible Investment Policy in March 2026. This framework addresses divestment from companies involved in conflict zones and those linked to genocide. The proposed next steps included continued engagement with LCIV¹ to accelerate product launches that align with the framework and collaboration with like-minded LGPS² funds to refine exclusion criteria and create collective demand for suitable investment products.

Pension Fund Governance Update

An update on the implications of the 2026 LGPS Regulations was scheduled. These regulations introduced enhanced requirements for asset pooling, fund governance, accountability, and oversight. The report highlighted the requirement for Administering Authorities³ to participate in an FCA-regulated LGPS asset pool, such as London CIV for the Southwark Fund, and to ensure investment implementation through the pool. The signing of an Investment Management Agreement (IMA) with LCIV was noted. The regulations also introduced a strengthened governance framework, including the appointment of a dedicated LGPS Senior Officer, enhanced knowledge requirements, and the need for a Training and Governance Strategy. An action plan detailing compliance with these regulations was to be presented.

Pension Fund Business Plan 2026-27

The panel was asked to review and agree the proposed Business Plan for 2026-27. This plan outlines the strategic objectives for the Fund across various areas, including administration, communication, actuarial/funding, the Pensions Advisory Panel itself, financial and risk management, investment management, and the Local Pension Board.

Training Strategy

A review of the Fund's new Training Strategy was scheduled. This strategy aims to formalise and strengthen the approach to training and knowledge for those involved in pension fund decision-making and governance, in line with updated LGPS regulations and statutory guidance. It establishes a framework for identifying, delivering, monitoring, and evidencing training activities, covering nine core knowledge areas and setting expectations for induction training and annual needs analysis. The strategy also details the Fund's subscription to Hymans Robertson's Aspire online learning platform.

Local Pension Board Update

An update from the Local Pension Board (LPB) meeting of 1 July 2026 was to be provided. This included a training session on the National Pensions Dashboard programme, an update on the Action Tracker, and reports on Pension Services, Annual Benefit Statements, McCloud⁴ remedy, and the Risk Register. The LPB Chair was also expected to outline focus areas for the Board for 2026-27, including embedding the Fit for Future regulations.

Pension Services – Admin/Ops Update

An update on the pensions administration and operational functions was scheduled. This covered recruitment within the service, IT/systems upgrades, progress on the National Dashboard Programme, and communication initiatives, including the completion of the 2026 Pensions Increase exercise and the issuance of Annual Benefit Statements. The report also detailed complaint management cases and provided performance metrics for administration, noting that transfer performance had been impacted by national changes to GAD⁵ transfer factors.