Hackney Council's Pension Fund is intensifying its focus on climate change by targeting companies with high carbon emissions. The Pensions Committee agreed to follow up with companies highlighted as high emitters for scope 1, 2 and 3 emissions at a meeting on Tuesday 29 July 2025.
The move is part of a broader strategy to incorporate climate and sustainability objectives into the fund's investment decisions. This includes an assessment of the current asset allocation, reflecting government-led changes to Local Government Pension Schemes (LGPS). The government is driving forward reforms to consolidate LGPS assets, improve governance and secure local investment to help drive growth in the UK. The government formally introduced the Pension Schemes Bill in June 2025. The committee is also evaluating new investment opportunities.
The committee noted a reduction of 11.6% in the fund's scope 1 and 2 carbon footprint from 2023 to 2025. They also acknowledged the use of proxies in calculating metrics where industry data limitations exist, and the limitations of scenario analysis.
As part of its investment strategy review, the committee will complete an Investment Belief Survey to capture updated views from the Pensions Committee, Pensions Board and officers on investment beliefs and the Fund's current position. Miriam Adams, Assistant Director of Pension Fund Investments and Administration, stated that the survey aims to inform a refresh of the strategic investment objectives for the Fund, which will in turn inform the investment strategy decision making. The Investment Strategy Review - Scene Setting report summarised the investment strategy process and preparatory steps to take place alongside the 2025 actuarial valuation.
The asset allocation review aims to:
- Assess the appropriateness of the current asset allocation
- Reflect Government-led LGPS changes and try to 'future-proof' the ongoing relationship with the London Collective Investment Vehicle (LCIV)
- Incorporate climate and sustainability objectives
- Incorporate local investment allocation decisions
- Evaluate new investment opportunities
The asset allocation review will aim to incorporate local investment allocation decisions. While a 5% target for local investment had been discussed, the definition of 'local' now included the region or pool. The investment in Resonance was nearing full drawdown but new local investment opportunities were being explored through London CIV.
The committee also approved an updated Voting Policy, noting the impact of pooling on voting of Fund shares. They agreed to delegate the procurement of a dedicated voting provider for the Fund’s passive manager to the Group Director Finance and Corporate Resources in conjunction with the Chair. The committee will also engage the Local Authority Pension Fund Forum (LAPFF) to deliver periodic enhanced engagement on Conflict Affected areas and High-Risk Areas (CAHRAs) reporting on behalf of the Fund, noting the direct award procurement route for LAPFF via the National (LGPS) Framework.
The specific impact of pooling on voting and how the dedicated voting provider will address this are not detailed in the provided text.
The committee received Investment Strategy Training from Redington, the Fund's Investment Consultant, focusing on regulatory and fiduciary responsibilities, the objective of investment strategy, approach to Risk, approach to pooling, appropriate level of risk and return and how that level of return can be achieved in the most efficient way.
