Red Line Voting gets Green light to Save Planet, Respect Human Rights and Stop Fat Cats

I was really pleased to take part in the debate and vote in favour of the AMNT's Red Lines initiative which was approved at our summer conference on Wednesday this week. They cover a wide range of environmental, social and corporate governance issues.

Red Line Voting empowers pension trustees to make responsible investing a reality and will direct fund managers to oppose poor governance practise in companies where failure poses a risk to its shareholders.

Trustees bodies will be able to instruct fund managers to follow all Red Lines en bloc or a sub section.  It should not cost the scheme for doing so. Fund managers will have to comply with these instructions or explain why not and then run the risk of being sacked by trustees.

On environmental Red Lines the AMNT  worked with Carbon Disclosure Project and will be urging pension schemes to adopt them as they believe it would take climate change up the UK corporate agenda.

On social issues the Red Lines include trade union recognition, race equality, gender equality, commitment to equality monitoring and publishing the data, that companies should have a plan to introduce the Living Wage, and get rid of zero hours contracts.

On governance there will be a vote against the remuneration policy if any director is paid more than 100 times the average pay in that company’s UK workforce. Also on governance companies should have a tax policy stating what their tax practises are.

The AMNT are now planning to launch Red Line Voting in Autumn, in time for the 2016 voting season. They have have worked closely with UKSIF on the development of these Red Lines and major fund managers are already preparing to implement Red Line Voting instructions.

The big campaign now is to persuade pension schemes to adopt Red Line Voting, particularly those in pooled funds. Up to now investors in pooled funds were in practise unable to direct the engagement and voting on the shares associated with their investments. Red Line Voting gets round this. Fund managers may receive dozens of Red Line Voting instructions, but they are all the same instructions so they can then allocate votes pro rata. Since more than £2-trillion of assets under management in the UK are in pooled funds this could have a significant impact.

The AMNT has been granted £75,000 by the Joseph Rowntree Charitable trust over two years to develop and launch this initiative.

Red Line Voting is a revolutionary concept. I agree with "Responsible Investment" magazine that this is "a major evolution in UK Pension funds" but think "Engaged Investor" got it right when they called it "Power to the People: the new power for trustees to control fat cat behaviour".

Many people have been involved in the AMNT project on Red Lines but special mention to its Co Chair Janice Turner, who thought it up and was the driving force behind it and Co Chair, Barry Parr and Committee member, Bill Trythall. 

Implications of Climate Change for Investment Returns and for Beneficiaries: AMNT Open Day

This is the first in series of posts on last weeks AMNT open meeting and AGM.

I was really pleased to see that there was a quite a few UNISON LGPS member nominated reps present.

The morning was a training session on the implications of Climate Change on Investment returns and for our Beneficiaries. Bearing in mind the very unusal weather we have been having this winter, this is a very topical subject.

Our meeting was opened by our Joint Chair Barry Parr who introduced Catherine Howarth. (see picture) who is a former pension trustee and the CEO of ShareAction (use to be called "Fair Pensions").

Catherine believes that Trust schemes have clear duties to take Climate Change seriously but with Contract schemes it is less clear legally but still a compelling reason to act.

She spoke about the Greenlight report launched recently with Pension Minister Steve Webb MP. There is a need to "nudge" pension schemes into managing the growing risk of climate change. There are a number of good schemes that are addressing this but many others who clearly "don't get it".

One sign of a good scheme is how well it communicates with its members.  Schemes needs to organise relevant training, look at governance policy development and carry out risk assessments. Need to look at low carbon investment opportunities and take into account that Auto-enrolment will bring in many young people into pension schemes, who will bear all the investment risk  of climate change in the coming decades.

Next was a speaker from PRI then climate change expert Meg Brown.

Pension Minister Steve Webb MP to address AMNT 26 June 2013

Association of Member Nominated Trustees

Pensions Minister Steve Webb MP will be the keynote speaker at our first AMNT Summer Conference which will take place on June 26th 2013, at Towers Watson, 21, Tothill Street, London SW1H 9LL. Some details are still to be finalised, but currently, the day looks like this:

We will begin with registration from 0930, and the main conference starts at 1000.
Steve Webb has agreed to start us off with a keynote speech.

Then Co-Chair Barry Parr will go through the results of our Member Survey.
Bill Trythall (Committee Member) will then talk on "The Universities Superannuation Scheme".

After coffee, Ewan McGaughey will talk on "MNTs in Corporate Governance", then another Member will talk on "A Smaller DC Scheme".

Lunch and networking will be followed by our hosts Towers Watson talking on Current Pension Issues, then John Gray (Committee Member) will present on "London Borough/Local Government Schemes".

Following this, Michael Johnson will speak on "Charging in Pensions".

After a tea break, our Friends will leave us, and we will go into Round Table Debates on Current Pensions Issues with one of our Sponsors leading each table.

A final feedback session will be followed by a closing summary, which is due to finish at 1700.

After the meeting has closed, there will be the usual networking opportunity with drinks provided by our hosts Towers Watson

There are limited places available for this event, so please let us know as soon as possible if you are able to attend. Click on one of the below links and let us know by email, including whether you have any dietary requirements and if you plan to attend for the drinks reception.

Email mail@amnt.org if you wish to send the whole or part of the day at the meeting.

(if you are a member nominated Trustee or representative then join and apply to attend)

Association of Member Nominated Trustees

Recently I joined the "Association of Member Nominated Trustees".  The AMNT was only launched last year and has already 150 members who serve as trustees or representatives on pension funds with over £50 billion of assets. 

On Wikipedia the AMNT is described as being "composed of pension trustees selected by employees or members of private and public sector pension funds in the United Kingdom. It a non-profit group which seeks to organise employee representatives through sharing information, expertise and coordinating policies for pensions and corporations in which money is invested".

I went to its AGM in March and was very impressed.  In particular I went to a work group on Defined Benefit pension schemes and was pleased to be in a room full of people who were genuinely positive and supportive about DB. I was also the only person from a public sector scheme.  At the meeting it was decided to form a working group defending and promoting DB pensions schemes which I will Chair.

I have always thought that despite the good work of the TUC Pension Trustee network and LAPFF there needs to be some form of national forum for all member nominated trustees and representatives. Our schemes are all different but we all have particular pressures and problems common to all. The founding joint Chairs are Janice Turner, Member Nominated Trustee of the BECTU Staff Retirement Scheme and Barry Parr, Member Nominated Director of the Orange Pension Scheme.

If you are interested in getting more information or becoming a member check out its temporary website here.   The next open meeting will be on 7 July in London.