The Pensions Committee of Shropshire Council scheduled a meeting to discuss a valuation and funding strategy statement update, pensions administration and corporate governance monitoring, and a climate risk management report. The meeting was also scheduled to cover several items that were considered exempt from press and public access, including governance, new employers, investment portfolio updates, investment strategy implementation, and investment monitoring.

Valuation and Funding Strategy Statement Update

The committee was scheduled to receive a presentation from Ms Michelle Doman and Mr Mark Wilson, both Fellows of the Institute and Faculty of Actuaries, concerning the 2025 valuation of the Shropshire County Pension Fund. The presentation was expected to cover a preliminary analysis of the valuation and its outcomes, as well as the funding strategy statement.

The presentation was expected to highlight key factors influencing the fund's experience since 2022, including investment performance and high levels of CPI¹. It was noted that while the 3-year investment return was below the 2022 valuation assumption, interest rates had increased significantly, leading to higher expected future returns.

The presentation was also expected to cover key parameters such as the real discount rate², sustainability reserve, and recovery period, as well as the impact of these parameters on contribution rates. Preliminary results suggested that the 2025 valuation would see contribution reductions for many employers, balancing short-term affordability with longer-term contribution stability.

The Funding Strategy Statement was expected to include new sections and updated policies, such as a surplus policy, asset share policy, deficit recovery policy, and admission and termination policies. The consultation process for the updated draft Funding Strategy Statement was also scheduled to be discussed.

Climate Risk Management Report

The committee was scheduled to discuss the 2025 Climate Risk Management Report, including the Task Force on Climate-Related Financial Disclosures (TCFD) report. Mr Ethan Phipps and Mr Basyar Salleh from LGPS Central were scheduled to present the report.

The report was expected to highlight that best practices were in place to ensure the fund manages climate risk exposure responsibly, and that there had been significant progress toward the fund's climate objectives. Portfolio decarbonisation was evidenced across a range of climate indicators, and priority companies and actionable engagement objectives to manage risk exposure had been identified. The report also noted that an annual carbon footprint assessment, with climate scenario analysis, was aligned to each actuarial review.

The report was expected to present climate metrics over time for listed equities, including financed emissions and weighted average carbon intensity (WACI). It was noted that the fund's listed equity net asset value (NAV) had increased by 75.6% since 2020, but that asset allocation decisions and company-level decarbonisation had meant that the fund's financed emissions had decreased.

The report was also expected to cover the fund's climate stewardship plan, including escalation grades and progress levels for companies such as RWE AG, Glencore, and Shell.

Corporate Governance Monitoring

The committee was scheduled to receive a report from Mr Peter Chadderton, Pensions Investment and Responsible Investment Manager, informing members of corporate governance changes, including the government's latest LGPS - Fit for the Future consultation[^4], and updates since the last committee, together with a review of socially responsible investment issues arising in the quarter from 1 July 2025 to 30 September 2025. This included the latest position in respect of the Palestine Solidarity Campaign's demands.

The report was expected to provide detail on the actions taken by the fund's key stewardship partners in respect of voting and engagement activity, as well as an update on the fund's position in respect of the letter received from the Palestine Solidarity Campaign and the actions taken by the Scheme Advisory Board.

Members were expected to note and accept the position as set out in the report in respect of voting and engagement activity, including reports from LGPS Central, Columbia Threadneedle Investments, and the Local Authority Pension Fund Forum (LAPFF). Members were also expected to note and accept the fund's update on companies in conflict affected and high-risk areas, and to note and approve the process for responding to the government's latest Local Government Pension Scheme (England and Wales): Fit for the future consultation.

Pensions Administration Monitoring

The committee was scheduled to receive a report from the Pensions Administration Manager providing monitoring information on the performance of and issues affecting the pensions administration team.

The report was expected to provide detail on team workloads and performance, and projects currently being undertaken, including valuation 2025, annual benefit statements, and pension dashboards. Information was also expected to be included regarding regulatory changes and the work undertaken by the Scheme Advisory Board.

Members were asked to note the KPI chart and information on those KPIs not currently meeting the 95% target, and the actions being taken to address this. Members were also asked to note the progress and completion of key activities from the business plan 2024-25 up to Q2, and to note the progress of the Pension Dashboard implementation which is provided in the update report.