Agenda item

To receive any questions or petitions.

Notes:

1.  The deadline for Member’s questions is 12.00pm four working days before the meeting (13/06/2022).

2.  The deadline for public questions is seven days before the meeting (10/06/2022).

3.  The deadline for petitions was 14 days before the meeting, and no petitions have been received.

There were six questions from six members of the public.  These and the responses were published as a supplement to the agenda.  Supplementary questions and responses included:

1.    Ian Chappell asked: Could the committee please give priority to assessing Shell’s lack of a serious response to your continuing engagement events over the last five years and initiate an escalation process to show that the committee is adopting a policy of engagement, with teeth?

The Chairman responded that the question had been answered, that the points made were understood and would be raised with investment managers, and engagement would continue.

2.    Kevin Clarke asked: At some point in the future, the demand for fossil fuels will reduce to probably nothing - so what is the Surrey pension fund planning or how are they planning to cope with that event?

The Chairman responded that professional advisors were used to managing these type of assets and the issue of the tipping points was understood. It was a risk, but there were other risks, and they all had to be taken into account.

3.    Clive Teague asked: Please could the Surrey Pension fund ensure that the Climate Opportunities Fund does not invest in fossil fuel exploration and extraction?

The Chairman responded that in relation to renewables, the Climate Opportunities Fund is one of the funds invested in, but Surrey does not have absolute control over the decisions of the fund manager responsible for this Fund. It was possible there could be some assets with fossil fuel exposure, but the stated intent of the Fund is to explore opportunities for positive climate outcomes.  Another Member explained that this topic was discussed at the responsible investment sub-committee and therefore thought this underlined the need for openness and transparency when this came to public debate regarding the Responsible Investment update report later in the meeting. It was agreed that there would be a discussion on whether that report could be taken in Part 1 of the meeting as it arose on the agenda.

4.    Jenifer Condit asked on behalf of Lindsey Coeur-Belle: When is this committee going to make a net zero carbon announcement?  We are aware that you're working on a responsible investment policy, but it's been some time and even in the announcement there is urgency and or there should be, and will that date be substantially earlier than the 2050 date that was used some years back and is really yesterday's kind of idea and not at all fit for purpose now?

The Chairman responded that a position in relation to a net zero commitment with be part of the responsible investment policy, and this must also be considered in conjunction with the current actuarial valuation concurrent review of the investment strategy. One thing to be done was track a path to net zero.    The Chairman did not commit to a date but acknowledged the importance of a net zero pathway.

5.    Jenifer Condit asked:  My question had to do with carbon finance, specifically the gargantuan lending by the major banks of the world to the fossil fuel industries, which is very much including extraction for new assets and Surrey Pension Fund is in the position of owning shares in most of the largest banks in the world.  What is Surrey Pension Fund doing about that as an investor? You have given me a lot of disclosure about activities being undertaken by you and your advisors, and I'm grateful for that. A lot of the activity that you describe is the work of your advisors talking with banks about how banks are talking to their clients about what their clients could do to decarbonize. But the specific and most important question isn't any of that, it's what are the banks doing themselves in their lending book and in other forms of financing to the oil and gas exploration and production companies. Will you ensure that this item, specifically as regards the financing undertaken by banks, is a significant item on the engagement list of all your engagement advisors going forward and will you consider perhaps urging fund managers to shift some of their bank investments to the better banks?

The Chairman responded that those points were well made and in terms of engaging with banks he had spoken with the Chair of the LAPFF to say the role of banks must be included in their engagement approach. He had also looked at the exclusions in the LGIM Fund and posited that there were probably not enough.  The banks were facilitators of much investment in this area.

6.    Ian Chappell asked on behalf of Lucianna Cole:  Lucianna asked if the fund could regularly disclose details of the Fund’s portfolio, particularly given that Border to Coast regularly published their portfolio on their website. It's an extremely useful disclosure and provides transparency of information. Your reply said that you said you would review this request for transparency. Can I just ask therefore, can you please give me a date when you will give a definitive response?

The Chairman responded that he could not give a date but that the information given to Members was regarded as important and the papers for this meeting were in the public domain.  He explained that the fund had recently taken on and strengthened its communications and this was an important element of disclosure to members and employers. He gave a commitment that it would be addressed soon.