Agenda item

Competition and Markets Authority - Investment Consultant Objectives

Report for the Director of Finance


The Panel were reminded that, at its meeting on 3 December 2019, they received a briefing paper from Hymans Robertson LLP (Hymans) advising of the findings of the December 2018 report of the Competition and Markets Authority (CMA), and their subsequent Order, in respect of the need for Pension Scheme Trustees to set annual objectives for their investment consultants. In response to the Order, the Pensions Panel continued to agree a high-level set of objectives with Hymans for each financial year, which incorporated more focussed objectives and detail on how the objectives were to be measured. The 2022/23 objectives were signed off by the Panel at the meeting in June 2022, where it was agreed that the Panel would assess, measure and report on the performance of the Investment Consultant against the objectives set, by way of a collective annual review.


Appendix 1 to the report had been annotated with comments, which reflected the Director of Finance’s view as to whether the desired outcome of the 2022/23 objectives had been achieved in the short term. In the opinion of the Director of Finance, the objectives and outcomes had been considered to have been met in all cases. The Panel were asked to consider and concur with this view.


The Panel was also requested to confirm its assessment of the outstanding objective, ‘Pensions Committee and Panel are satisfied with the quality, presentation and content of any training requested’ at the meeting. The Panel were in agreement that the level of service and training provided was of a satisfactory level.


It was explained to the Panel that, to reflect the long-term nature of the Fund’s Investment Strategy, most of the objectives for 2023/24 continued to be set at a high level. Whilst the focus of the objectives would be linked to the workplan for the year ahead, it would be the outcomes and the examples provided to demonstrate how the objectives had been achieved, which would be considered most important. The focussed objectives for the 2023/24 Financial Year were detailed in Appendix 2 to the report.


Very minor changes were proposed to the objectives for 2023/24, which reflected the fact that the workplan for 2023/24 continued to be focussed on the implementation of the recommendations from the Strategic Asset Allocation Review, and the Funds’ Climate Change Strategy. The only other minor change was that the objective which related to Regulation/Legislation and incorporated Responsible Investment, had been split into two separate objectives, given one was not always directly linked to the other, and the Fund had now set clear Climate Change targets.


Resolved: a. That the Panel’s concurrence with the view of the Director of Finance; that the desired outcomes from the Investment Consultant Objectives for 2022/23 have been met, where these can be considered in the short term, be noted.


b. That the Pensions Panel’s assessment of the objective ‘Pensions Committee and Panel are satisfied with the quality, presentation and content of any training requested’, be confirmed.


c. That the Investment Consultant Objectives provided in Appendix 2 to the report be approved, and the specific focus for the 2023/24 financial year be noted.


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