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Archive for April, 2012

Havering Council pension funds still invested in tobacco companies – News – Romford Recorder

Havering Council pension funds still invested in tobacco companies – News – Romford Recorder.

to the tune of £1.7m apparently.  The most remarkable point in this Essex news story is the quote from their Cabinet member for value who states:

“It is important to remember that the council does not make the decision on where its pension investments are placed.

“This is down to the discretion of the expert fund managers who manage the pension fund.

“They are always asked to take into account ethical decisions but they should make decisions based on the economic sustainability of the fund.”

This appears to be a clear breach of duty by the council.   The pension fund trustees cannot opt out in this way as this extract from an ASH briefing paper shows:

It is common practice for pension funds to delegate day-to-day investment decision-making to external fund managers. However, this does not prevent them from instructing their fund managers in particular matters . Indeed, the law is quite clear that, although trustees may delegate their investment functions, they cannot delegate their fiduciary responsibilities.
Final responsibility for investment decision-making rests with the trustees themselves. The judge in Martin v City of Edinburgh stressed that trustees must “apply their minds separately and specifically to the question whether [the decision at hand] would be in the best interests of the beneficiaries.”  Moreover, in order to fulfil their fiduciary duties, the law requires trustees to monitor their fund managers on an ongoing basis. In other words, as FairPensions’ recent report concluded,  “It is a vital principle of fiduciary obligation that fiduciaries cannot outsource their obligation to think.”

 

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a Bid to stub out smoking – Local – Luton Today

a Bid to stub out smoking – Local – Luton Today.

 

Welcome news from Luton, where the council is considering pulling out of tobacco investments due to the incompatibility of these investments with their new remit for public health.  Its good to see the Director of Public Health being quoted here as well.  Will this be the first of many reconsidering their policies in the lead up to the 2013 move of public health to local government?

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A stellar stock? Beware the smoke trail – FT.com

A stellar stock? Beware the smoke trail – FT.com.

 

Interesting blog from the Financial Times suggesting that fund managers think long and hard about whether it continues to make sense to stay invested in tobacco.

Categories: Uncategorized