Responsible Investments

What does working towards disinvesting mean:

• In a small minority of cases: where the Fund holds illiquid (such as private equity) fossil fuel investments, it will not immediately dispose of these investments, if this results in a poorer financial outcome for the Fund and its beneficiaries.
• Fossil fuel companies: still exist in investment indices and where the Pension Fund has chosen to invest in index-tracking investments, it may still have exposure to fossil fuel companies. The Pension Fund will work with its investment managers on the options for index-tracking products that reduce their exposure to fossil fuel companies and/or follow ‘Paris-aligned’ objectives that reduce the overall carbon footprint of the investment.
• Hampshire invests in partnership: with other Local Government Pension Scheme pension funds (via the ACCESS pool) and therefore there must be collective agreement to changes to investment portfolios to exclude fossil fuels, which it is actively pursuing.

Where Hampshire can independently or with its partners, agree to exclude fossil fuel companies from its investments, it will typically be based on the following standard definitions of a fossil fuel company:

• Fossil Fuel Production: Companies that derive +10% of revenue from the extraction and production of fossil fuels (oil, gas and thermal coal).
• Fossil Fuel Ownership: Companies that own +10% of assets in fossil fuel reserves (coal, oil and natural gas).
• Fossil Fuel Activities: Companies that derive +10% of revenue from oil and gas related activities including distribution, retail, equipment and services, extraction and production, petrochemicals, pipelines and transportation, thermal coal mining.

In the short-term, while the Pension Fund continues to hold fossil fuel related investments, it will continue to engage with the relevant companies through its investment managers, to promote the transition to a low carbon economy.

More about the Fund