Issue - meetings

RESOLVED:

The Committee noted, commented on and approved the revised Investment Strategy

Statement subject to the agreed changes being made.

            Mr Buckland and Mr Latham took the Committee through the latest Investment Strategy Statement (ISS) and noted the following key points;

-       The regulations requiring funds to produce an ISS were made in 2016.

-       The first ISS was required to be published by 31 March 2017.

-       These regulations are still in place; however new regulations are due later in 2020. As a result, the ISS may need to be further amended.

-       Statutory guidance states that Fund policies on investment cannot go against Government policy.

-       There are a number of key requirements for inclusion in an ISS and Mr Buckland highlighted these, including diversification of investments and consideration of risk.

                      Mr Latham highlighted the changes that had been made to the ISS.

            The first change was to include a new Funding and investment's objective at bottom of page 4 of the ISS in relation to the pooling of assets through WPP. The Committee agreed the proposed wording.

                      Cllr Williams asked whether the Supreme Court case involving the Palestine Solidarity Campaign and Government policy would inhibit the Fund’s Responsible Investment policy. Mr Buckland responded that the way in which the Responsible Investment policy has been written, his view is there is no conflict. He said that the bigger issue is that some Funds have disinvested due to certain ethical beliefs. Mr Buckland said that we await the results of the court case and will return to this issue, which should be known over the next few months.

            Mr Everett asked why the two asset classes, agriculture and timber, were included within the ISS, and not categories such as renewable energy. Mr Harkin explained that infrastructure as an asset class covers a range of investments including renewable energy.  He agreed to revisit the categories.

            The Chairman queried how the Fund's benchmark is determined. Mr Buckland said that the benchmark is a composite of all of the benchmarks of the Fund's underlying asset classes. For example, equities and private markets will both have a benchmark, adding these all together determines the Fund's overall benchmark.

            Mr Latham added that there are strategic ranges set out on page 12 of the ISS. He noted that a conditional range is used when there are major risks to the Fund, in which case the officers, taking account of advice from the Fund's Investment Consultants, can make decisions that move the asset allocations beyond the strategic range, into the conditional range. Mrs McWilliam asked whether the conditional range had been used before. Mr Latham confirmed that he couldn't recall an extreme situation, but it has been used when the Fund was going through a transition. 

            Mrs McWilliam suggested to soften the wording on page 21 of the ISS. The wording stated;

In the longer term, subject to the above mentioned objectives being met, the Clwyd Fund is committed to investing all of its assets through the WPP.

            Mrs McWilliam proposed that the wording should be closer aligned to the pooling objective on page 4 of  ...  view the full minutes text for item 100