Ms Miriam Adams, Interim Head of Pensions and Treasury introduced the report stating this was a summary of the Fund’s first report complying with the Task Force for Climate Related Financial Disclosures (TCFD). She said the report supported the Fund’s strategic investment objectives, with a particular focus on how it will fulfil its role as a responsible investor.

Ms Adams said the appendix was part of the restricted agenda however the main report was in the public domain. She said this was a key milestone for the committee as very few London Boroughs had achieved the same success as the London Borough of Tower Hamlets Pension Fund.

Mr Steve Turner from Mercer added that compliance with TCFD was not mandatory although consultation on LGPS pointed to compliance being expected shortly. He said this was the first report on the disclosure objectives, as previously the committee had received information on the carbon footprint. He said the matrix provided detailed information on the total emissions and implications of different temperature changes for the portfolio.

In response to questions from members the following was noted:

• The Chair asked if the temperature changes cited in the report were based on land and water and how the 3.2 degrees increase in the implied temperature rise of the listed portfolio was derived. In response Mr Turner stated that the analysis had been derived using scope 1 and scope 2 emissions data. He said calculating temperature rises was complex and therefore it was hard to predict their accuracy. However, the Tower Hamlets fund invested in funds such as the equities fund managed by Baillie Gifford which was Paris-aligned and therefore the Committee could be more confident the fund would achieve its targets. He said previously WACI data had been used to measure carbon emissions, but more progress was required by all parts of society, companies and investors, to see improvements in climate change financial disclosure.

The Pensions Committee RESOLVED to:

1. Consider and approve the 2020-21 TCFD report (Appendix 1); and
2. Continue to enhance its approach to Climate Risk.