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Statement of Investment Principles - April 2021

 

  1. Introduction. 1
  2. Investment Governance Structure. 2
  3. Investment Beliefs. 3
  4. Investment Objectives and Strategy. 5
  5. Use of Investment Managers. 6
  6. Stewardship. 7
  7. Investment Manager Arrangements. 8
  8. Risk Mitigation. 11
  9. Monitoring. 12
  10. Future Amendments. 13

 

Appendix 1: The Trustees Investment Strategy

Appendix 2: Fund Details

 

 

 

Glossary

 

Allianz

Allianz Global Investors GmbH

AVCs

Additional Voluntary Contributions

Aviva

Aviva Investors UK Fund Services Limited

BlackRock

BlackRock Investment Management (UK) Limited

ESG

Environmental, Social and Governance

(including, but not limited to, climate change)

LDI

Liability Driven Investment

Partners

Partners Group (Guernsey) Limited

Scheme

Jockey Club Racecourses Pension Scheme

Trustees

The Trustees of the Scheme

UNPRI

United Nations Principles for Responsible Investment

 

 

 

1.           Introduction

 

This statement is made in accordance with the requirements of legislation[1] and, in determining a suitable investment strategy for the Scheme, the Trustees have considered The Pension Regulator’s Investment Guidance for defined benefit pension schemes.

 

The main body of this statement sets out the principles and policies that govern investments made by the Trustees of the Scheme. Details of the specific investment arrangements in place are set out in the Appendices.

 

Upon request, a copy of this statement will be made available to members, the Scheme Actuary and any investment managers used by the Trustees. This statement will also be made publicly available, as required by legislation.

 

 

2.           Investment Governance Structure

 

Investment Advice

As required by legislation, in the preparation and maintenance of this statement and when considering the suitability of any investments, the Trustees will obtain and consider written advice from their investment adviser.

The Trustees are advised on investment matters by First Actuarial LLP. First Actuarial LLP is regulated by the Institute and Faculty of Actuaries and is qualified to provide the required advice through knowledge and practical experience of financial matters relating to pension schemes.

 

Legal Advice

Whenever deemed necessary, the Trustees will seek advice from their legal adviser on investment matters.

 

Employer Consultation

Under legislation, the ultimate responsibility for determining the investment strategy rests with the Trustees. However, the Trustees must consult with the sponsoring employer and consultation must comprise a sharing of views, not simply notification of intent.

 

Investment Managers

Day-to-day management of the Scheme’s assets is delegated to one or more investment managers.

To ensure safekeeping of the assets, ownership and day to day control of the assets is undertaken by custodian organisations which are independent of the sponsoring employer and the investment managers. Where pooled investment vehicles are used, the custodians will typically be appointed by the investment manager.

 

Members’ Views and Other Non-Financial Matters

In the relevant regulations “non-financial matters” refers to the views of the members. This can include, but is not limited to, ethical views, views on certain ESG factors and views on the present and future quality of life for the members.

 

The Trustees recognise that it is likely that members and beneficiaries will hold a broad range of views. However, the Trustees do not take non-financial matters into account in the selection, retention and realisation of investments. The Trustees will review their policy on whether or not to take account of non-financial matters as appropriate.

 

The Trustees believe that their duty to members and beneficiaries will be best served by ensuring that all benefits can be paid as they fall due and the Trustees' Investment Objectives are designed to ensure this duty is achieved.

 

Conflicts of Interest

 

The Trustees are satisfied that the investment strategy described in this Statement meets their responsibility to invest the assets in the best interests of the members and beneficiaries and, in the case of a potential conflict of interest, in the sole interest of the members and beneficiaries.

3.           Investment Beliefs

 

The investment beliefs stated below have been developed by the Trustees and are reflected in the Scheme’s investment strategy.

 

Appropriate Time Horizon

In determining investment objectives and a suitable investment strategy for the Scheme, the Trustees take into account an appropriate time horizon. The Trustees believe that an appropriate time horizon will be the period over which benefits are expected to be paid from the Scheme.

 

Risk versus Reward

Targeting higher levels of investment return requires increased levels of investment risk which increases the volatility of the funding position.

 

Asset Allocation

Long-term performance of the Scheme’s assets is attributable primarily to the strategic asset allocation rather than the choice of investment managers.

 

Diversification

Asset diversification helps to reduce risk.

 

Use of Pooled Funds

Taking into account the size of the Scheme’s assets, it is expected that pooled funds will typically be a more practical way of implementing the Scheme’s investment strategy than establishing segregated mandates with investment managers.

 

Use of Active Management

Active management has the potential to add value either through offering the prospect of enhanced returns or through the control of volatility. In addition, it is recognised that active management may help to mitigate the financial impact of ESG risks.

 

For each asset class, the Trustees will consider whether the higher fees associated with active management are justified.

 

ESG and Other Financially Material Considerations

The Trustees believe that financially material considerations, including certain ESG factors and the risks related to such factors, can contribute to the identification of both investment opportunities and financially material risks. Consequently, financially material considerations can have a material impact on investment risk and return outcomes.

The Trustees also recognise that long-term sustainability issues, particularly climate change, present risks and opportunities that increasingly may require explicit consideration.

 

Assessment of how ESG risks are mitigated will be one of the factors considered by the Trustees when selecting and monitoring investment managers.

 

Stewardship

The Trustees believe that good stewardship can help create, and preserve, value for companies and markets as a whole, which is in the best interests of members as better run enterprises are more likely to perform better over the longer term.

 

4.           Investment Objectives and Strategy

 

Defined Benefit Assets – Investment Objectives

 

The Trustees' primary investment objectives are:

  • to ensure that the assets are sufficient and available to pay members’ benefits as and when they fall due;
  • to generate an appropriate level of investment returns – to improve the funding position and thereby improve security for members; and
  • to protect the funding position – limiting the scope for adverse investment experience reducing security for members.


The Trustees' investment approach is designed to strike a balance between the above primary objectives but also considers:

  • the nature and timing of benefit payments;
  • expected levels of investment return on different asset classes;
  • expected levels of investment return variability and, specifically, the expected level of short-term volatility of the funding position;
  • the sponsoring employer’s ability to withstand additional contribution requirements that may arise from volatility in the funding position; and
  • the full range of available investments (within the bounds of practicality).

 

Defined Benefit Assets – Investment strategy


The Trustees have taken advice from their investment adviser to construct a portfolio of investments consistent with these objectives. In doing so, consideration is given to all matters which are believed to be financially material over the appropriate time horizon.

 

The Trustees do not explicitly consider non-financial matters when determining the Scheme’s investment strategy.

 

AVCs

Additional Voluntary Contributions (AVCs) are held separately from the main assets and the Trustees aim to make a variety of funds available with the member choosing which funds to use. From time to time the Trustees review the range of available funds to ensure the choice remains appropriate for members' needs.

Details of the current AVC arrangements are provided in

 

Appendix 1.

 

5.           Use of Investment Managers

 

Investment Manager Selection

 

The Trustees delegate the day to day management of the assets, including selection, retention and realisation, to professional investment managers.

 

When considering the suitability of an investment manager, the Trustees (in conjunction with their investment adviser), will take account of all matters which are deemed to be financially material. In particular, the Trustees will:

 

  • ensure that the investment manager has the appropriate knowledge and experience;
  • ensure that the investment manager’s mandate is appropriate; and
  • consider the investment manager’s approach to ESG matters.

 

When selecting investment managers, the Trustees may also take into account non-financially material considerations such as the investment manager’s administrative capabilities and the liquidity of the investments.

 

Where pooled investment vehicles are used, it is recognised that the mandate cannot be tailored to the Trustees' particular requirements. However, the Trustees ensure that any pooled investment vehicles used are appropriate to the circumstances of the Scheme.

 

The Trustees will normally select investment managers who are signatories to the UNPRI and who publish the results of their annual UNPRI assessment. This principle may be waived if a fund offered by a non-signatory manager is deemed to have investment characteristics which are particularly important for meeting the Trustees' investment objectives.

 

Manager Implementation

Assets are invested predominantly on regulated markets, as so defined in legislation. Any investments that do not trade on regulated markets are kept to a prudent level.

 

Use of Derivatives

The investment managers are permitted to use derivative instruments to reduce risk or for efficient portfolio management. Risk reduction would include mitigating the impact of a potential fall in markets or the implementation of currency hedging whilst efficient portfolio management would include using derivatives as a cost-effective way of gaining access to a market or as a method for generating capital and/or income with an acceptable level of risk.

 

Leverage

The instruments used by the investment managers of the Liability Matching Assets may result in the Liability Matching Assets being leveraged. Since these assets are closely aligned to the liabilities, the allocation to Liability Matching Assets (and any associated leverage) reduces the volatility of the Scheme’s funding position and therefore reduces risk.

 

6.           Stewardship

 

The Trustees' policy in relation to the exercise of rights attaching to investments, and undertaking engagement activities in respect of investments, is that they wish to encourage best practice in terms of stewardship.

 

However, the Trustees invest in pooled investment vehicles and therefore accept that ongoing engagement with the underlying companies (including the exercise of voting rights) will be determined by the investment managers’ own policies on such matters. For that reason, the Trustees recognise that their ability to directly influence the action of companies is limited.

 

Nevertheless, the Trustees expect that each investment manager will discharge its responsibilities in respect of investee companies in accordance with that investment manager’s own corporate governance policies and current best practice, including the UK Corporate Governance Code and UK Stewardship Code.

 

The Trustees also expect that each investment manager will take ESG factors into account when exercising the rights attaching to investments and in taking decisions relating to the selection, retention and realisation of investments.

 

When considering the suitability of an investment manager, the Trustees (in conjunction with their investment adviser) will take account of any particular characteristics of that manager’s engagement policy that are deemed to be financially material.

 

The Trustees recognise that the members might wish the Trustees to engage with the underlying companies in which the Scheme invests with the objective of improving corporate behaviour to benefit the environment and society.

 

However, the Trustees' priority is to select investment managers which are best suited to help meet the Trustees' investment objectives. In making this assessment, the Trustees will receive advice from their investment adviser. The Trustees recognise that the investment managers’ own policies are likely to be focussed on maximising financial returns and minimising financial risks rather than targeting an environmental or societal benefit.

 

7.           Investment Manager Arrangements

 

As the Scheme’s assets are held in pooled funds, the Trustees have limited influence over the investment managers’ investment decisions. In practice, investment managers cannot fully align their strategy and decisions to the (potentially conflicting) policies of all their pooled fund investors in relation to strategy, long-term performance of debt/equity issuers, engagement and portfolio turnover.

It is therefore the Trustees' responsibility to ensure that the approaches adopted by investment managers are consistent with the Trustees' policies before any new appointment, and to monitor and to consider terminating any existing arrangements that appear to be investing contrary to those policies.

 

The Trustees expect investment managers, where appropriate, to make decisions based on assessments of the longer term financial and non-financial performance of debt/equity issuers, and to engage with issuers to improve their performance. The Trustees assess this when selecting and monitoring managers.

 

The Trustees' policy on selecting, monitoring, evaluating and (where necessary) terminating these arrangements is set out in further detail below.

 

Compatibility of Pooled Funds with the Trustees'

 

Investment Strategy

When selecting a pooled fund, the Trustees consider various factors, including:

 

  • the assets that will be held within that fund and whether the asset allocation of the fund is expected to change over time;
  • the risks associated with the fund along with the return that is expected;
  • the fund’s objective (as stated by the fund’s investment manager) and whether the objective is consistent with the performance that the Trustees expect from that fund;
  • the fund’s fee structure to ensure that this is reasonable and that it does not provide an incentive for the investment manager to manage the fund in a way that differs from the expectations of the Trustees;
  • how frequently underlying investments within the fund are expected to be traded by the investment manager;
  • how financially material considerations (including ESG factors) over the appropriate time horizon are taken into account by the investment manager;
  • the investment manager’s policy in relation to the exercise of the rights (including voting rights) attaching to the investments held within the pooled fund; and
  • the investment manager’s policy in relation to undertaking engagement activities in respect of the investments held within the pooled fund*.

 

*This includes engaging with an issuer of debt or equity regarding matters including (but not limited to) performance, strategy, capital structure, management of actual or potential conflicts of interest, risks, and ESG matters. It also includes engaging on these matters with other investment managers, other holders of debt or equity and persons or groups of persons who have an interest in the issuer of debt or equity.

  

  1. Investment Manager Arrangements (continued)

After analysing the above characteristics for a fund, the Trustees identify how that fund would fit within their overall investment strategy for the Scheme and how the fund is expected to help the Trustees meet their investment objectives.

 

Duration of Investment Manager Arrangements

The Trustees normally expect that pooled funds will be held for several years.

However, as part of the periodic strategic asset allocation reviews (which take place at least every three years), the Trustees will review whether the ongoing use of each fund remains consistent with their investment strategy.

The Trustees regularly monitor the financial and non-financial performance of the pooled funds held and details of this monitoring process is set out below. If the Trustees become concerned about the ongoing suitability of a pooled fund, they may reduce exposure to it or disinvest entirely. Such action is expected to be infrequent.

 

Monitoring Pooled Funds

The Trustees regularly assess the performance of each fund held and this monitoring includes an assessment of whether the investment manager continues to operate the fund in a manner that is consistent with the factors used by the Trustees to select the fund (as listed above).

 

When assessing the performance of a fund, the Trustees do not usually place too much emphasis on short-term performance although they will seek to ensure that reasons for short-term performance (whether favourable or unfavourable) are understood.

 

The Trustees expect the investment managers of pooled funds to invest for the medium to long term and they expect investment managers to engage with issuers of debt or equity with a view to improving performance over this time frame.

 

If it is identified that a fund is not being operated in a manner consistent with the factors used by the Trustees to select the fund, or that the investment manager is not engaging with issuers of debt or equity, the Trustees may look to replace that fund. However, in the first instance, the Trustees would normally expect their investment adviser to raise the Trustees' concerns with the investment manager.

 

Thereafter, the Trustees, in conjunction with their investment adviser, would monitor the performance of the fund to assess whether the situation improves.

 

The Trustees expect to summarise certain aspects of their monitoring, particularly in relation to stewardship, in an annually produced Implementation Statement.

  

  1. Investment Manager Arrangements (continued)

 

Portfolio Turnover

The Trustees are aware of the requirement to monitor portfolio turnover costs (the costs incurred as a result of the buying, selling, lending or borrowing of investments).

When selecting a pooled fund, the Trustees will consider how the investment manager defines and measures:

 

  • the targeted portfolio turnover (the frequency within which the assets of the fund are expected to be bought or sold); and
  • turnover range (the minimum and maximum frequency within which the assets of the fund are expected to be bought or sold).

 

At least annually, the Trustees, in conjunction with their investment adviser, will consider the transaction costs incurred on each pooled fund. As part of this analysis, the Trustees will consider whether the incurred turnover costs have been in line with expectations.

 

The Trustees will take the above information on portfolio turnover into account when assessing the ongoing suitability of each pooled fund.

 

8.           Risk Mitigation

When determining suitable investment objectives and when designing the Scheme’s investment strategy, the Trustees (in conjunction with their investment adviser), will take into account all risks that are assessed to be financially material. The principal investment risks are listed in the Trustees' Investment Risk Policy. That Policy also provides an explanation of how the investment risks are managed.

 

Risk Capacity and Risk Appetite

In determining a suitable investment strategy, the Trustees consider how the volatility of the funding position is likely to be affected by changes to the asset allocation. An important consideration for the Trustees is whether a potential investment strategy is consistent with the ability of the sponsoring employer to address any future increase in deficit that may arise due to market movements.

 

Self-Investment Risk

Legislation imposes a restriction that no more than 5% of a pension scheme’s assets may be related to the sponsoring employer. The Trustees do not hold any direct employer-related assets and any indirect exposure is expected to be less than 5% of total assets.

 

ESG Risks

The Trustees (in conjunction with their investment adviser) have considered the likely impact of the financially material ESG risks associated with all of the Scheme’s investments and have assessed the mitigation of such risks implemented by each of the investment managers. In making this assessment, the Trustees recognise that, where pooled investment vehicles are held, the extent to which ESG factors will be used in the selection of suitable underlying investments will be determined by the investment managers’ own policies on such matters.

 

The Trustees however consider ESG factors to be important and this is reflected by the introduction of an ESG-focussed equity fund following a robust assessment process.

 

Liquidity Risk

The majority of the Scheme’s investments will be liquid and will be realisable for cash at relatively short notice without incurring high costs. However, the Trustees recognise that the liabilities are long-term in nature and that a modest allocation to less-liquid investments may be appropriate.

Details of the liquidity characteristics of the funds held are provided in Appendix 2.

 

9.           Monitoring

The Trustees regularly review the Scheme’s investments for all matters considered to be financially material over the future period for which benefits are expected to be paid from the Scheme. This includes reviewing that the assets continue to be managed in accordance with each manager’s mandate and that the choice of managers remains appropriate.

 

Furthermore, the Trustees regularly monitor the position of the investment managers with regards to ESG matters.

To assist with the monitoring of the investment managers, the Trustees receive regular information from their investment adviser providing details of investment manager performance and asset allocation decisions. This analysis includes comparisons with benchmarks and relevant peer-group data.

 

The analysis assesses whether performance has been in line with expectations given market conditions and whether the level of risk has been as expected.

 

The investment adviser also provides regular updates on the investment managers’ actions regarding ESG factors and shareholder engagement.

 

The investment adviser regularly meets with the managers of pooled funds on its approved list.

 

 

10.       Future Amendments

 

This statement will be reviewed at least every three years and without delay after any significant change in circumstances or investment strategy.

 

The Trustees have consulted with the sponsoring employer as part of the work preparing this statement.

 

The principles set out in this Statement have been agreed by the Trustees:

 

 

 

 

 

 

Signed:……………………………………………………                     Date: ………………………

For and on behalf of the Trustees of the Jockey Club Racecourses Pension Scheme.

 

 

Appendix 1: The Trustees' Investment Strategy

 

Strategic Asset Allocation

In determining the strategic asset allocation, the Trustees view the investments as falling into two broad categories:

 

  1. Growth Assets – Assets that are expected to deliver long-term returns in excess of liability growth. The use of Growth Assets is expected to deliver a level of investment returns deemed appropriate by the Trustees given the risk involved.
  2. Liability Matching Assets – Assets that are expected to react to changes in market conditions in a similar way to the liabilities. The use of Liability Matching Assets is expected to protect the funding position of the Scheme.

 

In addition, the Trustees may hold cash. Cash will normally be held in the Trustees' bank account if it is to be used to make payments due in the short-term whereas cash that is to be held for more than a few weeks will normally be held in a cash fund.

 

At the time of preparing this statement, the Scheme was in the process of moving towards the allocations described below. The expected split of the Scheme’s assets between the above categories, once the transition is complete, is approximately 76% Growth and 24% Liability Matching.

The split of the Scheme’s assets between Growth and Liability Matching Assets is not regularly rebalanced and will vary over time as market conditions change.

 

The Trustees will review the strategic asset allocation periodically, and at least every three years, to ensure that the investment strategy remains consistent with the Trustees' funding objectives. As part of such a review, the Trustees will consider the risks associated with the investment strategy.

 

Investment Strategy Implementation

The Trustees have selected funds managed by Allianz, Aviva, BlackRock and Partners to implement the Scheme’s investment strategy.

 

Further details of the investment strategy and the funds used are provided below.

 

 Appendix 1: The Trustees' Investment Strategy (continued)

 

Design of the Growth Asset Portfolio

The structure of the Scheme’s Growth Assets has been designed to offer diversification across a range of underlying asset classes and to achieve this by combining investment managers with different asset management styles.

 

The strategic allocation for the Scheme’s Growth Assets is as follows:

 

Pooled Fund

Strategic Allocation of the Growth Assets

Allianz Global Multi-Sector Credit Fund

11%

BlackRock Dynamic Diversified Growth Fund

9%

BlackRock Institutional Equity Funds – Emerging Markets

5.5%

Partners Fund (Guernsey)

7%

Aviva Lime Property Fund

13%

BlackRock Sterling Short Duration Credit Fund

7.5%

BlackRock ACS World ESG Equity Tracker Fund

47%

Total Growth Assets

100%

The allocation of the Growth Assets is not automatically rebalanced but will be monitored and rebalanced at the discretion of the Trustees.

 

Design of the Liability Matching Portfolio

The Scheme’s Liability Matching Assets are invested in leveraged Liability Driven Investment (LDI) funds managed by BlackRock. The funds used are:

 

·            BlackRock LMF Leveraged 2032 Index Linked Gilt Fund

·                    BlackRock LMF Leveraged 2068 Index Linked Gilt Fund

·            BlackRock LMF Leveraged 2040 Index Linked Gilt Fund

·                    BlackRock LMF Leveraged 2040 Gilt Fund

·            BlackRock LMF Leveraged 2050 Index Linked Gilt Fund

·                    BlackRock LMF Leveraged 2052 Gilt Fund

·            BlackRock LMF Leveraged 2062 Index Linked Gilt Fund

·                    BlackRock LMF Leveraged 2068 Gilt Fund

 

The current allocation to LDI funds is expected to hedge approximately 65% of funded liabilities in terms of interest rate and inflation exposures (noting that this analysis is approximate and due to be refreshed in the near future). The Trustees expect the LDI allocation (and hence level of hedging) to increase over time as the Scheme matures.

 

Cash

The Trustees may invest in the BlackRock ICS - Sterling Liquidity Fund.

Appendix 1: The Trustees' Investment Strategy (continued)

 

LDI Leverage Management Policy

In an environment of rising yields, a recapitalisation payment may need to be paid into one or more of the LDI funds. This will ensure that leverage within the LDI funds remains within a permissible range.

 

The Trustees have provided BlackRock with authority to meet a recapitalisation contribution by selling assets in the following order:

 

  1. BlackRock ICS - Sterling Liquidity Fund
  2. BlackRock Sterling Short Duration Credit Fund
  • BlackRock Dynamic Diversified Growth Fund
  1. BlackRock ACS World ESG Equity Tracker Fund
  2. BlackRock Institutional Equity Funds – Emerging Markets
  3. Liability Matching fund(s) which require the recapitalisation contribution

 

If the leverage of a BlackRock LDI fund falls below a minimum threshold, BlackRock will make a cash payment from the relevant fund to raise the leverage. The Trustees have provided BlackRock with authority to invest any such cash proceeds in the BlackRock Sterling Short Duration Credit Fund.

 

Cashflow Management Policy

Any investments or disinvestments will be made at the discretion of the Trustees, but the Trustees will maintain a Cashflow Management Policy which will record how such payments should be structured. The Cashflow Management Policy will be designed to ensure the allocation of the Scheme’s assets remains closely aligned with the strategy described in this statement.

 

To ensure the Scheme operates efficiently, the Trustees may share the Cashflow Management Policy with the individual(s) responsible for processing payments from the Scheme.

 

The Cashflow Management Policy will be reviewed from time-to-time by the Trustees and, as a minimum, at least every three years in line with a review of this statement. Given that the Cashflow Management Policy is designed to keep the Scheme’s asset allocation aligned with the investment strategy and investment principles described in this statement, the sponsoring employer is satisfied that the Cashflow Management Policy can be amended by the Trustees without consulting the sponsoring employer.

 

Additional Voluntary Contributions

The Scheme’s AVC arrangements are held with Royal London and Utmost Life and Pensions (Utmost) formerly Equitable Life.

 

Appendix 2: Fund Details

This Appendix provides a summary of the funds used to implement the Scheme’s investment strategy. The details provided below were correct as at March 2021

The following points should be noted:

  • AMC: The Annual Management Charge applicable to each fund represents the fee payable to the fund manager.
  • Additional expenses: These are third party costs associated with the operation of a fund such as fees paid to the administrator, the custodian and the auditor and the costs associated with the use of third-party funds where these are used. The level of the additional expenses may vary over time.
  • Legal Structure: An explanation of the different types of fund legal structures is provided in the Trustees' Investment Risk Policy
  • T: Trade Date

Allianz Global Multi-Sector Credit Fund

Objective

The Allianz Global Multi Sector Credit Fund invests in a wide variety of credit assets including investments grade bonds, high yield bonds, emerging market credit and securitised debt, aiming to outperform LIBOR by 3% p.a. over 3 years, gross of fees.

Legal Structure

Investment Company with Variable Capital

Trading Frequency

Daily

Notice Period

T

Settlement Period

T+3

Fee

AMC:

0.42% p.a.

Additional Expenses (approx.):

0.00% p.a.

 

 

 

Appendix 2: Fund Details (continued)

BlackRock Dynamic Diversified Growth Fund

Objective

This fund targets capital growth by investing in a diversified portfolio of equities, bonds, property and cash. Derivatives (exchange traded and over-the-counter) may be used for efficient portfolio management and to hedge underlying positions. The fund's performance objective is to outperform cash (3 month LIBOR) by 3% p.a. (net of fees) over rolling 3 year periods.

Legal Structure

Investment Company with Variable Capital

Trading Frequency

Daily

Notice Period

T

Settlement Period

T+3

Fee

AMC:

0.55% p.a.

Additional Expenses (approx.):

0.12% p.a.

 

BlackRock Institutional Equity Funds – Emerging Markets

Objective

The BlackRock Institutional Equity Funds - Emerging Markets will seek to maximise the long-term total return by investing in emerging economies (directly or indirectly). Investments will be made in Latin America, Eastern and Southern Europe, Asia and Africa.

Legal Structure

Unit-linked insurance policy

Trading Frequency

Daily

Notice Period

T-1

Settlement Period

T+3

Fee

AMC:

0.75% p.a.

Additional Expenses (approx.):

0.20% p.a.

 

 

 

Appendix 2: Fund Details (continued)

Partners Fund (Guernsey)

Objective

The Fund aims to deliver 8-12% p.a. over a full economic cycle.

Legal Structure

Unit Trust

Trading Frequency

Monthly

Notice Period

T – (1 Month plus 1 business day)

Settlement Period

T+24

Fee

1.5% of NAV plus unfunded commitments plus performance fee of 12.5% over a high watermark.

 

Aviva Lime Property Fund

Objective

The Aviva Lime Property Fund aims to achieve investment returns in excess of 1.5% (net of costs) p.a. above gilts over the medium to long term by investing in lower risk property assets with secure long term income streams.

Legal Structure

Unit Trust

Trading Frequency

Monthly priced. Redemptions are annual as at 31 December. The manager has the ability to defer payment for up to 12 months.

Notice Period

6 months

Fee

AMC:

0.40% p.a.

Additional Expenses (approx.):

0.12% p.a.

 

 

 

Appendix 2: Fund Details (continued)

BlackRock Sterling Short Duration Credit Fund

Objective

To generate income returns, with the prospect of capital growth, through an actively managed portfolio of predominantly corporate bonds with durations less than 5 years. The target of the fund is to return cash (LIBOR) +1.5% p.a., gross of fees, over a rolling 3-year period.

Legal Structure

Unit-linked insurance policy

Trading Frequency

Daily

Notice Period

T-1

Settlement Period

T+3

Fee

AMC:

0.15% p.a.

Additional Expenses (approx.):

0.05% p.a.

 

BlackRock ACS World ESG Equity Tracker Fund

Objective

The Fund aims to provide a return by tracking the performance of the MSCI World ESG Focus Low Carbon Screened Index, the Fund’s benchmark, to within 0.5%, by investing in shares of companies that make up the benchmark.

Legal Structure

Unit-linked insurance policy

Trading Frequency

Daily

Notice Period

T-1

Settlement Period

T+3

Fee

AMC:

0.14% p.a.

Additional Expenses (approx.):

0.03% p.a.

 

 

 

Appendix 2: Fund Details (continued)

BlackRock LMF Leveraged Gilt and Index Linked Gilt Funds

Objective

To provide leveraged exposure to the appropriate Treasury Gilt or Index-Linked Gilt. The funds are designed to be held until maturity and aim to provide a single payment on the specified maturity date of the underlying reference gilt. Due to the leveraged nature of the Funds, every £1 invested in the Funds provides more than £1 worth of exposure to the underlying reference gilt.

Legal Structure

Unit Trust

Trading Frequency

Daily

Notice Period

T-1

Settlement Period

T+3

Fee

AMC:

0.15% p.a.

Additional Expenses (approx.):

0.00% p.a.

 

 

[1] In particular, the Pensions Act 1995, the Occupational Pensions (Investment) Regulations 2005 and the Pension Protection Fund (Pensionable Service) and Occupational Pension Schemes (Investment and Disclosure) (Amendment and Modification) Regulations 2018 and the Occupational Pension Schemes (Investment and Disclosure) (Amendment) Regulations 2019.

Chair’s Statement - 31 July 2020

 

In accordance with the requirements of the Occupational Pension Schemes (Charges and Governance) Regulations 2015 (‘the Regulations’), the Trustees are required to provide a statement relating to the governance of the defined contribution benefits within the Scheme. This statement covers the period from 1 August 2019 to 31 July 2020 and has been prepared by the Chair of the Trustees – William Medlicott.

 

Background

The Scheme is a defined benefit scheme which means that the benefits are calculated on a pre-determined basis specified in the Scheme Rules. The Scheme is contracted out using the protected rights method in respect of service accrued after 6 April 1997 (providing each member with a protected rights account).  These protected rights accounts act as an underpin to the defined benefits payable under the Scheme Rules. Upon retirement, death or transferring out of the Scheme, the value of the defined benefit is checked against the value of the protected rights account and the higher benefit is provided to the member.

 

The assets in relation to these protected rights benefits are invested within the defined benefit (DB) assets of the Scheme. Members therefore have a notional protected rights account, which is valued in line with the value of the Scheme’s DB assets. 

 

Where members had less than 2 years’ service and left the Scheme prior to 6 April 2012, their protected rights accounts were retained within the Scheme and form a defined contribution only benefit.  The Trustees are currently in the process of discharging these benefits with a small number of members remaining to complete the exercise.

 

In addition, members can make additional voluntary contributions (AVCs) on a defined contribution basis to provide additional benefits at retirement.

 

Governance of the default investment arrangement

Protected rights accounts

The assets in relation to the protected rights benefits are invested within the defined benefit (DB) assets of the Scheme. As such, this is the Scheme’s default investment arrangement for defined contribution benefits, as defined in the Regulations.

 

As part of the actuarial valuation as of 31 July 2020, the value of the protected rights accounts was estimated to be c. £0.1m.

 

The Trustees do not formally review the investment strategy of the defined contribution assets attributed to the protected rights accounts to assess its appropriateness for members but regularly review the investment strategy and performance of the assets of the defined benefit section which gives the notional return for the protected rights accounts. The last formal review of the investment strategy for the Scheme’s DB assets was in October 2019.


AVCs

As of 31 July 2020, the AVC funds under management were:

Fund

Funds under Management

Utmost Life and Pensions (ex-Equitable Life)

£116,461

Royal London (formerly Scottish Life)

£330,691

 

The Scheme currently offers a range of AVC investment choices with both Utmost (formerly Equitable Life) and Royal London. The Scheme’s deemed default investment arrangement for the AVCs, as defined in the Regulations, is the Cautious Retirement Investment Strategy with Royal London under which funds are invested more cautiously as members near retirement age.

 

On 1 January 2020, Equitable Life transferred all its policies to Utmost Life and Pensions (Utmost), and members who were invested in the With Profits fund had their fund holdings switched to Unit Linked funds from this date. As part of the transition, all monies were held in the Secure Cash fund for the first 6 months and were moved into the Investing at Age range of funds with effect from 1 July 2020.

 

The Trustees have considered the available information about the investment performance of the AVC funds in which members of the Scheme are invested. The Trustees are satisfied that the investment performance (net of fees) remain consistent with the stated objectives for these funds.

 

The Trustees considered the DC investment strategy of the AVCs in April 2020 to assess its appropriateness for members. This review was undertaken in the knowledge that most members use their AVC funds to provide additional tax-free cash at retirement. The Trustees decided not to make any changes to the options available. As part of the transition from Equitable Life to Utmost, the Trustees communicated details to members about the default lifestyle fund options with Utmost, recommending that members consider whether the way in which their AVCs are invested remains appropriate.  A further review of investment strategy is anticipated to take place in 2023.

The Trustees have prepared a Statement of Investment Principles which sets out the Trustees’ aims and objectives relating to investment strategy. A copy of this SIP is appended to this statement.

 

Charges and transaction costs

Protected rights accounts

The investment returns on the Scheme’s DB assets (used to notionally value the protected rights accounts) take into account annual fund management charges of between 0.13% to 1.50% of assets under management (depending on the investment fund). These charges are therefore incurred by members when valuing their protected rights accounts to assess whether this underpin bites.

 

AVCs

Members can self-select the AVC investment funds. However, most members are invested in the Cautious Retirement Investment Strategy with Royal London which gradually moves members’ funds into a cash fund and funds suitable to buy an annuity, such as fixed interest investments. The underlying funds that make up this strategy are shown in the table below.

 

The total annual management charge for the Royal London funds is 0.53% pa.

 

All AVC funds under management with Utmost have been invested in Unit Linked funds since 1 January 2020. These funds are subject to an ongoing investment management charge between 0.50% - 0.75% per annum. The TER charge for the Clerical Medical With-Profits fund (which is also managed by Utmost) is considered when declaring annual interest rates rather than being an explicit charge deducted from members’ funds.

 

In addition to these explicit member charges, members may also incur transaction costs (incurred as a result of buying, selling, lending or borrowing investments).

 

The following table summarises the costs and charges for the funds invested in, as follows:

 

Fund

Total Expense Ratio (TER)

Transaction costs

(%)

Royal London Cautious Retirement Investment Strategy (default)

0.53%

n/a

Royal London Managed*

0.53%

0.05%

Royal London Defensive Managed*

0.53%

0%

Royal London Fixed Interest*

0.53%

-0.01%

Royal London Deposit*

0.53%

0%

Utmost Investing at Age **

0.75%

n/a

Utmost Money Market (Deposit)

0.50%

0%

Clerical Medical With-Profits***

1.00%

0.22%

* The Royal London default comprises of these underlying funds.

** Members of Equitable Life’s With-Profit Fund were transferred into the Secure Cash Fund from 1 January to 30 June 2020. Where no election was made to transfer to another fund, members were placed into the Investing at Age target dated funds, the asset mix and TER will depend on the term to retirement for each member. Transaction charges are unavailable despite attempts to obtain them.

***The total expense ratio is implicit in the bonus rate set for the current year.

 

The Utmost Investing at Age strategy uses an Automatic Investment Option which means it is designed to gradually reduce a member’s exposure to equities from age 55 to and through taking their retirement benefits. The strategy uses a combination of the Utmost Multi Asset Moderate and Cautious funds to achieve this balance.

 

A Market Value Reduction may be applied to the With Profits Fund on transfer or encashment before maturity. This ensures that members who choose to leave the fund before their normal retirement date do so on terms that properly reflect the underlying value of their policy.

 

For the Clerical Medical With-Profits Fund, members are also eligible to receive a terminal bonus at maturity. The amount of terminal bonus may be lower, or nil, on transfer or encashment before maturity.

 

In addition to the above member-borne costs and charges, the sponsoring employer meets the cost of ongoing governance and administration services. In assessing value-for-money, the Trustees have only considered the costs and charges met by members.

 

The Appendix to this Statement provides an illustration of the cumulative effect of charges.

 

Core financial transactions

The Trustees receive and review reports from the Scheme’s administrators on at least a 6-monthly basis to monitor the level of administration services being provided to members.

The processing of core financial transactions is monitored by the administrators, who have implemented internal control procedures to help ensure that such transactions are processed promptly and accurately (including a relevant review process). These activities include procedures to ensure the accuracy of benefit calculations and settlements and the prompt resolution of any inconsistencies identified. Activities covered include controls and procedures to manage the settlement of benefits and individual transfers out.

 

The Trustees are satisfied that during the period of this statement, there have been no significant delays in processing these transactions or issues to report.

 

Value for Members

The Trustees wish to ensure that the Scheme provides good value for members. Within its latest draft DC Code of Practice, the Pensions Regulator has set out its expectations of trustee boards in a number of areas including the assessment of value for members. The Trustees have taken these expectations into account when considering value for members of the Scheme.

 

The Trustees conducted a review in April 2020 considering the services and charges offered and believe that the Scheme’s offers value for members.

 

Trustee Knowledge & Understanding

It is important that the Trustees continue to have sufficient knowledge and understanding to fulfil their duties. This is complemented by having a professional trustee (Capital Cranfield Trustees) on the trustee board. All new Trustees are required to undertake training following their appointment, including use of the Pensions Regulator’s Trustee Toolkit.  All Trustees have also been provided with and have a working knowledge of the Scheme’s documents including the Trust Deed and Rules, SIP and other informal policies.

 

The Trustees are supported by independent and professional advisers who ensure that they are kept abreast of the latest legislative, regulatory and market developments that apply to the Scheme. These advisory appointments are also periodically reviewed.

 

Training is delivered during Trustees’ meetings when the Trustees are considering issues, the understanding of which is enhanced through training. Relevant training materials are included in Trustees’ meeting packs.

 

All training received by the Trustees is recorded and the training needs of the Trustees are regularly reviewed by the Trustees and their advisers to identify any relevant gaps in knowledge. Although training received over the period on ESG was primarily from a DB perspective, high level ESG concerns for DC were covered in the 2020 review.

In addition, Capital Cranfield Trustees are subject to AAF audit requirements which require each of its professional trustees to attend 5 or more technical training sessions per year.  This is to ensure that the Trustees have a high level of knowledge and understanding, which it can use when exercising its discretions and setting the Scheme’s strategic direction.

 

How to contact the Trustees

If you have any further queries regarding the Scheme, please contact:

First Actuarial LLP
2nd Floor
Mayesbrook House
Lawnswood Business Park
Leeds

LS16 6QY
Tel: 0113 818 7300
Email: leeds.admin@firstactuarial.co.uk

 

William Medlicott

Chair of the Trustees of the Jockey Club Racecourses Pension Scheme

29 January 2021

 

The tables below show the cumulative impact of costs and charges (as set out in the main body of this Statement).

They are presented in the format prescribed by legislation and on the specific assumptions outlined below.  In considering choices, members should have regard to the impact of inflation and charges but also the actual investment performance of their fund choices.

 

Funds used in the Scheme’s Royal London default

 

Projected Pension Pot in today’s money

 

Managed

Defensive Managed

Fixed Interest

Deposit

Years

Before charges

After all costs and charges

Before charges

After all costs and charges

Before charges

After all costs and charges

Before charges

After all costs and charges

 

1

£14,092

£14,013

£13,977

£13,903

£13,644

£13,572

£13,628

£13,554

 

3

£14,740

£14,492

£14,380

£14,156

£13,377

£13,168

£13,330

£13,116

 

5

£15,417

£14,989

£14,796

£14,413

£13,116

£12,775

£13,038

£12,692

 

10

£17,250

£16,304

£15,888

£15,075

£12,485

£11,845

£12,337

£11,691

 

15

£19,301

£17,735

£17,060

£15,769

£11,884

£10,982

£11,674

£10,769

 

20

£21,595

£19,292

£18,320

£16,494

£11,312

£10,182

£11,047

£9,919

 

25

£24,162

£20,986

£19,672

£17,252

£10,768

£9,440

£10,453

£9,137

 

30

£27,035

£22,828

£21,123

£18,046

£10,250

£8,752

£9,891

£8,416

 

35

£30,249

£24,831

£22,682

£18,876

£9,757

£8,115

£9,359

£7,752

 

40

£33,844

£27,011

£24,356

£19,744

£9,287

£7,524

£8,856

£7,140

 

 

Assumptions:                                    

  1. Projected pension pot values are shown in today's terms and do not need to be reduced further for the effect of future inflation
  2. The starting pot size is assumed to be £13,779.
  3. Inflation is assumed to be 2.5% each year
  4. No further contributions have been assumed

 

  1. Values shown are estimates and are not guaranteed
  2. The projected growth rate for each fund are as follows:

 

Managed                                             2.27% pa above inflation

Defensive Managed                           1.43% pa above inflation

Fixed Interest                                      -1.97% pa above inflation

Deposit                                                -1.10% pa above inflation

 

Other funds available to members

Projected Pension Pot in today’s money

 

Utmost Investing at Age

Multi Asset Moderate fund

Utmost Investing at Age

Multi Asset Cautious fund

Utmost Money Market Deposit fund

Clerical Medical With-Profits fund

Years

Before charges

After all costs and charges

Before charges

After all costs and charges

Before charges

After all costs and charges

Before charges

After all costs and charges

1                                                                                                    

£6,976

£6,925

£6,896

£6,845

£6,775

£6,740

£7,027

£6,943

3

£7,236

£7,077

£6,989

£6,834

£6,626

£6,526

£7,395

£7,134

5

£7,505

£7,233

£7,083

£6,823

£6,481

£6,319

£7,782

£7,330

10

£8,222

£7,636

£7,323

£6,796

£6,133

£5,830

£8,841

£7,844

15

£9,008

£8,063

£7,572

£6,769

£5,803

£5,378

£10,043

£8,394

20

£9,870

£8,513

£7,829

£6,742

£5,491

£4,961

£11,410

£8,982

25

£10,813

£8,989

£8,095

£6,715

£5,195

£4,577

£12,962

£9,611

30

£11,847

£9,491

£8,371

£6,688

£4,916

£4,222

£14,726

£10,285

35

£12,979

£10,021

£8,655

£6,662

£4,651

£3,895

£16,729

£11,006

40

£14,220

£10,580

£8,949

£6,635

£4,401

£3,593

£19,005

£11,777

 

Assumptions:                                     

  1. Projected pension pot values are shown in today's terms and do not need to be reduced further for the effect of future inflation
  2. The starting pot size is assumed to be £6,850
  3. Inflation is assumed to be 2.5% each year
  4. No further contributions have been assumed
  5. Values shown are estimates and are not guaranteed
  6. The projected growth rate for each fund are as follows:

 

Utmost Investing at Age Multi Asset Moderate                       1.84% pa above inflation

Utmost Investing at Age Multi Asset Cautious                        0.67% pa above inflation

Clerical Medical With-Profits                                                  -2.58% pa above inflation

Utmost Money Market (Deposit)                                            -1.10% pa above inflation

Jockey Club Racecourses Pension Scheme

Implementation Statement

January 2021

 

Glossary

 

BlackRock

BlackRock Investment Management (UK) Limited

ESG

Environmental, Social and Governance

Investment Adviser

First Actuarial LLP

Scheme

Jockey Club Racecourses Pension Scheme

Scheme Year

1 August 2019 to 31 July 2020

SIP

Statement of Investment Principles

UNPRI

United Nations Principles for Responsible Investment

 

Introduction

An investment in equities (shares) brings with it an entitlement to vote at general meetings of the company whose shares are held. Some of the Scheme’s assets are invested in equities and the Trustees’ SIP includes wording relating to the Trustees’ voting and engagement policies.

This Implementation Statement provides an assessment of how, and the extent to which, the voting and engagement policies described in the SIP were followed over the Scheme Year.

 

In addition, it summarises the voting record of the Scheme’s investment manager and provides information on the significant votes made in respect of the Trustees’ equity holdings. Information is also provided on the how the Scheme’s investment manager makes use of the services of proxy voting advisers.

 

Relevant Investments

The Scheme’s assets are invested in pooled funds and some of those funds include an allocation to equities. Where equities are held, the investment manager has the entitlement to vote.

 

At the end of the Scheme Year, the Scheme invested in the following funds which included an allocation to equities*:

 

  • BlackRock Aquila Life (50:50) Global Equity Index Fund
  • BlackRock Dynamic Diversified Growth Fund
  • BlackRock Institutional Equity Funds – Emerging Markets

 

* The Scheme also invests in the Partners Fund, which has an allocation to listed equities. However this has been excluded from our analysis, on the grounds of materiality. Partners do operate stewardship guidelines which set out principles that they will apply in all the areas we would expect them to consider. They are not signatories to the UK Corporate Governance Code but they have been assessed as A+ by UNPRI (for Strategy & Governance).

 

Voting and Engagement Policies in the SIP

The Trustees revised the SIP during the Scheme Year with the first document in force over Period 1 and the second in force over Period 2 where:

 

  • Period 1 applied from 1 August 2019 to 24 September 2019; and
  • Period 2 applied from 25 September 2019 to 31 July 2020.

Period 1 SIP Wording Relating to Voting and Engagement

The key points in this SIP relating to voting and engagement were:

  • The Trustees invest primarily through pooled investment vehicles. It is therefore accepted that the extent to which corporate governance, socially responsible practices and ethical behaviour are used in the selection of suitable investments will be determined by the investment managers’ own policies on these matters.

 

  • Similarly, it is accepted that ongoing engagement with companies in which investments are made (including the exercise of voting rights) will also be determined by the investment managers’ own policies.

Trustees’ Assessment of Whether These Policies Were Followed

Over the course of Period 1, all the Scheme’s assets were invested in pooled funds over this period meaning, as stated in the SIP, engagement with companies (and the exercise of voting rights) was determined by the investment managers’ own policies.

 

Period 2 SIP Wording Relating to Voting and Engagement

A new SIP was prepared to ensure that the document would comply with new legislation which came into effect on 1 October 2019.

 

The key points in this SIP relating to voting and engagement were:

 

  • The Trustees believe active management has the potential to add value either through offering the prospect of enhanced returns or through the control of volatility. In addition, it is recognised that active management may help to mitigate the financial impact of Environmental, Social and Governance risks.
  • The Trustees recognise that it is likely that members and beneficiaries will hold a broad range of views on ESG and other non-financial matters. Whilst the Trustees will seek to avoid investing in a way that is likely to be strongly opposed by those individuals, the Trustees do not directly take such views into account when determining the Scheme’s investment strategy.
  • Where the Trustees invest in pooled investment vehicles, it is accepted that the extent to which corporate governance, socially responsible practices and ethical behaviour are used in the selection of suitable investments will be determined by the investment managers’ own policies on these matters.
  • Similarly, it is accepted that ongoing engagement with companies in which investments are made (including the exercise of voting rights) will also be determined by the investment managers’ own policies.
  • The Trustees recognise that the membership might wish the Trustees to engage with the companies in which the Scheme invests with the objective of improving corporate behaviour to benefit the environment and society.
  • However, the Scheme’s assets are invested in pooled funds and, as noted above, the Trustees therefore rely on the investment managers to carry out such engagement. The Trustees recognise that the investment managers’ engagement policies are likely to be focussed on maximising financial returns and minimising financial risks rather than targeting an environmental or societal benefit.
  • The Trustees do however consider ESG policies and, if they are felt to be inappropriate, will replace the fund in question.
  • Furthermore, the Trustees regularly monitor the position of the investment managers with regards to ESG matters.
  • The investment adviser also provides regular updates on the investment managers’ actions regarding ESG factors and shareholder engagement.

Trustees’ Assessment of Whether These Policies Were Followed

The Trustees have not changed their stance regarding the importance of good stewardship or on the way members’ views on engagement should be reflected in the Scheme’s investment strategy.

 

Over the course of period 2, the assets were invested in pooled investment vehicles and, consequently, it remained the case that responsibility for exercising voting rights was the responsibility of the investment manager.

 

The ESG risks associated with the Scheme’s investments were considered in First Actuarial’s paper entitled ESG Report dated September 2019. First Actuarial will update its ESG assessments annually and the results will be shared with the Trustees via the Hub.

 

The Trustees discussed the findings of the ESG report with the investment adviser and further considerations were made in First Actuarial’s paper entitled ESG Fund Options dated October 2019.

 

The Trustees continue to regularly monitor the position of the investment manager with regards to ESG matters.

 

The Investment Manager’s Voting Record

A summary of the investment manager’s voting records is:

image8yuq4.png


Notes

Split of votes may not sum to 100% due to rounding

These voting statistics are based on each manager’s full voting record rather than votes related solely to the funds held by the Scheme.

 

Use of Proxy Investment Advisers

 

imagegagx9.png

Our fund manager’s voting behaviour

We have reviewed the voting behaviour of our fund manager by considering the following:

  • broad statistics of their voting record such as the percentage of votes cast for and against the recommendations of boards of directors (i.e. “with management” or “against management”)
  • the votes they cast to in the year to 31 March 2020 on the most contested proposals in eight categories across the UK, the US and Europe
  • Statements made by our fund manager on the subjects of stewardship, corporate governance and voting

 

We have also compared the voting behaviour of our fund manager with their peers over the same period.

Our key observations are below along with actions we have taken as a result of our review of the fund manager’s voting behaviour.

 

Voting in Significant Votes

Based on information provided by the Trustees’ investment adviser, the Trustees have identified significant votes in eight separate categories. The Trustees consider votes to be more significant if they are closely contested. i.e. close to a 50:50 split for and against. A closely contested vote indicates that shareholders considered the matter to be significant enough that it should not be simply “waved through”. In addition, in such a situation, the vote of an individual investment manager is likely to be more important in the context of the overall result.

The five most significant votes in each of the eight categories based on shares held by the Scheme’s investment manager are listed in the Appendix. In addition, the Trustees considered each investment manager’s overall voting record in significant votes (i.e. votes across all stocks not just the stocks held within the funds used by the Scheme).

 

Description of Voting Behaviour

BlackRock remain signatories to the UNPRI and the UK Stewardship Code and provide details online relating to their corporate governance policies.

 

However, BlackRock also participate in stock lending (so may not vote on stocks that are on loan) and active funds can ‘go short’ on stocks held within the manager’s passive funds.

 

We observed that BlackRock had a strong tendency to vote with management. In line with this, but in contrast to their peers, they voted against contested shareholder resolutions designed to address issues such as climate change, human rights and forced labour.

 

We find this to be unsatisfactory and our Investment Consultant has raised these concerns with BlackRock.

However, we note that, in January, BlackRock made public commitments to vote against management when they are failing to make progress on climate change issues.

 

We expect to see a more satisfactory voting record from BlackRock in the future but continue to monitor the situation.  

 

 

………………………………………………………………………..   Date: …………………….

Signed on behalf of the Trustees of the Jockey Club Racecourses Pension Scheme

 

Significant Votes

The table below records how the Scheme’s investment manager voted in the most significant votes identified by the Trustees.

 

imagej4j0s.png

 

Note

Where the voting record has not been provided at the fund level, we have based our analysis on the shares held within the Scheme’s pooled funds as at 31 March 2020. This means it is possible that that some of the votes listed above may relate to companies that were not held within the Scheme’s pooled funds at the date of the vote.

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