To consider the notices of motion set out below:

12.1

West Yorkshire Pension Fund – Independent Divestment Review

To be moved by: Councillor Warnes

Seconded by: Councillor Love

Council notes that:

a)    Bradford Council formally declared a ‘Climate Emergency’ in January 2019;

b)    Bradford Council, as a leading member of the Leeds City Region (LCR) Climate Coalition, is committed to achieving a net zero carbon LCR “by 2038, with significant progress by 2030”, and this aim was formally adopted by Bradford Council in October 2019;

c)    the forthcoming COP26 international meeting in Glasgow underlines the critical importance of doing everything possible to reduce our reliance on the fossil fuel sector and the greenhouse gas emissions associated with it;

d)    Bradford Council administers the West Yorkshire Pension Fund (WYPF) on behalf of its members and chairs its key committees (the Joint Advisory Group and the Investment Advisory Panel);

e)    Bradford Council must ensure that, in carrying out its role as the WYPF administering authority, its own interests do not compromise the fiduciary duty owed by the WYPF to its members;

f)     it is not within the power of Bradford Council to ‘dictate’ or ‘mandate’ how these funds should be invested;

g)    as part of its duties in relation to the WYPF, Bradford Council was also required to establish and operate a Local Pension Board – this board (the West Yorkshire Pension Fund Pension Board) is responsible for (i) assisting the administering authority in securing compliance with Local Government Pension Scheme regulations, (ii) any overriding legislation and guidance from the Pensions Regulator, and is currently chaired by a Bradford Councillor;

h)    the WYPF’s Investment Strategy Statement recognises climate change risk and is committed to achieving net-zero greenhouse gas emissions in its portfolio by 2050 or sooner;

i)      the WYPF is signed up to the Institutional Investors Group on Climate Change Net Zero Commitment Statement, which also accepts the need to transition investments to achieve net-zero portfolio greenhouse gas emissions by 2050, or sooner;

j)      although low carbon investments remain a relatively small market segment, WYPF has been able to build up its portfolio to over £700m, with a further £260m committed to future projects;

k)    according to Friends of the Earth, UK local government pensions held £9.7 billion of investments in fossil fuel companies in the 2019/20 financial year, and the WYPF remains one of four local authority pension funds with the largest investments of this kind;

l)      efforts to engage positively with the fossil fuel sector (via the Institutional Investors Group on Climate Change) have failed to make significant progress;

m)  numerous other organisations in the UK have now begun to divest their fossil fuel holdings and reduce their exposure to the growing risk of stranded fossil fuel assets, such as the National Employment Savings Trust, the Brunel Pension Partnership, the Environment Agency and a number of councils including Calderdale, Cardiff, Islington, Lambeth, Southwark and Waltham Forest;

n)    Calderdale Council’s cabinet agreed, in July 2021, to propose that their  ...  view the full agenda text for item 46

Resolved – That the following notices of motion (with amendments) be approved:

12.1 – West Yorkshire Pension Fund – Independent Divestment Review

Moved by: Councillor Angela Tait

Seconded by: Councillor Susan Hinchcliffe

Council notes:

• Calls for an independent divestment review of West Yorkshire Pension Fund’s investments in fossil fuel energy assets.
• Bradford Council formally declared a ‘Climate Emergency’ in January 2019, and as a member of the Leeds City Region (LCR) Climate Coalition, has formally committed to achieving a net zero carbon LCR “by 2038, with significant progress by 2030”.
• The United Nations Intergovernmental Panel on Climate Change (IPCC) warning in August 2021 that “Global warming of 1.5°C and 2.0°C will be exceeded during the 21st century unless deep reductions in carbon dioxide (CO2) and other greenhouse gas emissions occur in the coming decades.”
• Achieving net zero will require an unprecedented transformation of economy and society, including a massive shift to renewable energy and away from fossil fuels.
• That a transition to low carbon and renewable energy is already underway, driven by policy, technology and investment. Although currently the pace and magnitude of this transition falls short of that which is necessary to achieve the aims of the Paris Agreement.
• That Climate Change poses wide ranging financial and investment risk across all industry and business sectors as well as an existential risk, that particular concerns arise in respect to fossil fuel energy and that continued long-term investment in this area carries with it some significant financial risks.
• Bradford Council is the administering authority for the West Yorkshire Pension Fund (WYPF) and WYPF has investments in the fossil fuel energy sector.
• The concerns, both financial and ethical, of stakeholders in WYPF over its holdings in fossil fuel energy companies.

Council further notes:

• WYPF is a pension provider for almost 300,000 members, and 423 employers. The value of the Fund at March 31, 2021, was £16.3billion.
• The fund has specifically recognised climate change as a risk to its investments and has committed to a net-zero portfolio by 2050 or sooner and to implementing this with the aim of achieving real economy emissions reductions.
• Within the last year WYPF received a report commissioned from AON specifically on climate related investment risks and this was used in the development of the Fund’s strategic asset allocation.
• WYPF is signed-up to the Institutional Investors Group on Climate Change (IIGCC) Net Zero commitment statement. This includes setting an interim target for 2030 or sooner for reducing Scope 1, 2 and 3 emissions associated with its portfolios and setting a target for increasing investment in climate solutions, consistent with a fair share of the 50% global reduction in CO2 identified as a requirement in the IPCC special report on global warming.
• WYPF’s investments in renewable energy assets, technology and sustainable infrastructure has increased by 44% in the last two years. Currently it stands at £708m, with a further £262m committed awaiting drawdown. This is far in excess of is holdings in non-renewable energy.
• WYPF is a signatory to  ...  view the full decision text for item 46

Resolved – That the following notices of motion (with amendments) be approved:

1 – West Yorkshire Pension Fund – Independent Divestment Review

Moved by: Councillor Angela Tait

Seconded by: Councillor Susan Hinchcliffe

Council notes:

• Calls for an independent divestment review of West Yorkshire Pension Fund’s investments in fossil fuel energy assets.
• Bradford Council formally declared a ‘Climate Emergency’ in January 2019, and as a member of the Leeds City Region (LCR) Climate Coalition, has formally committed to achieving a net zero carbon LCR “by 2038, with significant progress by 2030”.
• The United Nations Intergovernmental Panel on Climate Change (IPCC) warning in August 2021 that “Global warming of 1.5°C and 2.0°C will be exceeded during the 21st century unless deep reductions in carbon dioxide (CO2) and other greenhouse gas emissions occur in the coming decades.”
• Achieving net zero will require an unprecedented transformation of economy and society, including a massive shift to renewable energy and away from fossil fuels.
• That a transition to low carbon and renewable energy is already underway, driven by policy, technology and investment. Although currently the pace and magnitude of this transition falls short of that which is necessary to achieve the aims of the Paris Agreement.
• That Climate Change poses wide ranging financial and investment risk across all industry and business sectors as well as an existential risk, that particular concerns arise in respect to fossil fuel energy and that continued long-term investment in this area carries with it some significant financial risks.
• Bradford Council is the administering authority for the West Yorkshire Pension Fund (WYPF) and WYPF has investments in the fossil fuel energy sector.
• The concerns, both financial and ethical, of stakeholders in WYPF over its holdings in fossil fuel energy companies.

Council further notes:

• WYPF is a pension provider for almost 300,000 members, and 423 employers. The value of the Fund at March 31, 2021, was £16.3billion.
• The fund has specifically recognised climate change as a risk to its investments and has committed to a net-zero portfolio by 2050 or sooner and to implementing this with the aim of achieving real economy emissions reductions.
• Within the last year WYPF received a report commissioned from AON specifically on climate related investment risks and this was used in the development of the Fund’s strategic asset allocation.
• WYPF is signed-up to the Institutional Investors Group on Climate Change (IIGCC) Net Zero commitment statement. This includes setting an interim target for 2030 or sooner for reducing Scope 1, 2 and 3 emissions associated with its portfolios and setting a target for increasing investment in climate solutions, consistent with a fair share of the 50% global reduction in CO2 identified as a requirement in the IPCC special report on global warming.
• WYPF’s investments in renewable energy assets, technology and sustainable infrastructure has increased by 44% in the last two years. Currently it stands at £708m, with a further £262m committed awaiting drawdown. This is far in excess of is holdings in non-renewable energy.
• WYPF is a signatory to  ...  view the full minutes text for item 46