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Islington Council’s Pension Fund is coming out of carbon

As the Global Climate Action Summit begins in San Francisco today (Wednesday September 12), Islington Council’s pension fund will this evening announce its intention to remain in the vanguard of the worldwide decarbonisation movement. By continuing to reduce its investment in fossil fuels, the fund will contribute to global efforts to keep the earth’s temperature from rising by more than 2°C.


The approach adopted by the pension committee will ensure that the fund’s investments in fossil fuels – such as coal, gas and oil – continue to reduce so that the scheme’s 21,000 members, including 6,600 pensioners, are not put in jeopardy when such assets become ‘stranded’ as the world moves away from a carbon-based economy.


At today’s meeting, councillors will direct the fund’s staff and advisers to produce detailed plans for how to build, during the four years ahead, on the significant progress that has already been made in reducing the fund’s carbon footprint. These plans will be discussed by the committee in public in late November.


In July 2017, the fund’s passive equity investments were moved to track low carbon indices, reducing the carbon intensity of those investments by approximately 45 per cent. The changes to the in-house managed assets alone reduced the fund’s equivalent carbon dioxide emissions by an estimated 14,243 tonnes per annum. The fund’s active equity portfolios already had a significantly lower than average exposure to carbon.


Councillor Dave Poyser, Chair of Islington Council’s Pension Fund, said:


“Islington Pension Fund is at the forefront of the decarbonisation movement. Last year, we cut the carbon footprint of the fund’s passive shares by 45%. The change in the funds's in-house managed assets alone reduced carbon emissions by 14,243 tonnes a year.


“Decarbonisation is not only about protecting the planet, it is also about protecting the financial interests of the scheme’s 21,000 members and 6,600 pensioners, when coal, oil and gas assets end up ‘stranded’ underground.


“Moving forwards, we will take a three-pronged approach. First, we will continue to explore opportunities to reduce the fund’s carbon footprint, considering in particular moving our internally managed UK passive equities to a lower-carbon global tracker instead. Second, we will actively consider investing in renewable energy and green infrastructure. Third, we will continue to engage through the London Collective Investment Vehicle, the Institutional Investors Group for Climate Change and the Local Authority Pension Fund Forum with the companies in which we invest to urge them to reduce their reliance on carbon.


“I have asked colleagues to pull together all our options for reducing the fund’s carbon footprint and for continuing to divest from fossil fuels in a detailed plan for us to discuss in public in late November.


“In the meantime, I would like to thank campaigners from Fossil Free Islington, as well as my predecessor, former Councillor Richard Greening, for all their support in striving to make Islington Council’s Pension Fund the greenest local authority pension fund in the UK.” 


Notes to Editor


Islington Council’s Pension Fund has approximately £1.3bn of investments in total.


The Pension Fund has 21,556 members and 6,669 pensioners.



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