North East council pension pots could be funnelled into wind farms and solar power following criticism

Pension pots could be funnelled into wind farms, solar power and other green technologies under new guidelines.

By James Harrison
Thursday, 26th November 2020, 5:30 pm
Pension pots could be funnelled into wind farms, solar power and other green technologies under new guidelines.
Pension pots could be funnelled into wind farms, solar power and other green technologies under new guidelines.

The Tyne and Wear Pension Fund, one of the biggest local authority schemes in the country covering Tyne & Wear and Northumberland, has previously faced criticism over some of the areas it has put its cash into, including tobacco and fossil fuels.

But a new approach modelled around five new ‘investment beliefs’ could help clean up its image – as well as reward bosses for spotting new prizes.

“[The new beliefs] are all around responsible investment, but have a tilt towards climate change,” said Ian Bainbridge, head of pensions at South Tyneside Council (STC), which runs the fund.

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“In the past we’ve [focussed on] well run companies producing superior returns – adding these beliefs gives more strength for what we’re trying to achieve.”

He added: “It’s not just risk when you talk about climate change, it’s also opportunities.

“Looking at our infrastructure portfolio in particular, we’re investing in things like wind farms and solar farms.

“So it’s not just the risk of being exposed to high carbon companies and that carbon transition, there’s also opportunities to take advantage of.”

Bainbridge was speaking at yesterday morning’s (Wednesday, November 25) meeting of STC’s Pensions Committee, which was held by videolink and broadcast via YouTube.

The new ‘investment beliefs’ being added to the fund’s guidelines include:

Monitoring the impact investments have on climate change Using bonds, property and other ‘private market investments’ to promote green credentials, as well as shares Work with companies on environmental issues to ‘protect shareholder value’ Consider the investment opportunities, as well as the risks, posed by climate change

In January, South Tyneside Councillor Ed Malcolm, the then cabinet member for resources and innovation, suggested the council’s ‘fiduciary duty’ to the fund if it made decisions based ‘purely on ethical views’.

Cllr Malcolm was replaced as the council’s finance chief this week by new leader Tracey Dixon.

Separately, the Pensions Committee’s new ‘beliefs’ were backed unanimously by its members.

South Tyneside Councillor Jim Foreman said: “[The beliefs] mean we can have faith in the fund that our investment strategy is the right one at this time.”

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