Minutes:
Catrina Arbuckle, Director, and Nick Page, Senior Investment Consultant, from Mercer Ltd were in attendance for this and the following item at the invitation of the committee.
1. Mr Vickers introduced the report and updated the committee on developments in respect of the Woodford Equity Income Fund since the committee’s 6 September meeting, including the latest valuation of the County Council’s investment. He and Ms Arbuckle answered questions of detail from the committee, including the risk to the County Council’s investment compared to the risk in other areas and types of investment in the Woodford Equity Income Fund, the ongoing situation regarding fees payable and the legal advice given by the General Counsel.
2. Mr Vickers drew the attention of the committee to the letter from Link dated 15 October 2019, announcing that the Woodford Equity Income Fund would be wound up and Mr Woodford removed as the fund manager. He outlined the new arrangements for the management of the fund's assets, which are that, as from 15 October, BlackRock Advisors (UK) Limited had been appointed to prepare the listed assets (Portfolio A) for the winding up of the Fund. BlackRock will seek to sell the assets in Portfolio A and use the proceeds to purchase money market funds and FTSE 100 index instruments to enable Link to return part of investors' cash as soon as possible. Meanwhile PJT Partners(UK) Limited had been appointed as a specialist broker to assist in selling the unlisted assets (Portfolio B).
3. The committee commented on the negative media coverage which had been given to the issue and acknowledged the support given to the committee by the County Council’s press office in communicating information to scheme members and the public. It was suggested that the ‘Open Lines’ magazine be used to communicate future news to pensioners and dependent pensioners.
4. Mr Page and Ms Arbuckle then set out and updated the committee on other aspects of the County Council’s investment strategy and answered questions of detail from the committee, including options for moving investment between different types of asset, and equity protection. The committee agreed that it needed to have more information on, and examples of, the investment options set out and requested a briefing session with Mercer Ltd and fund managers in the near future to help them to understand fully the options available.
5. The committee then addressed the report’s recommendations and it was RESOLVED that:-
a) the latest position on the Woodford Equity Income Fund be noted;
b) the investment in multi-asset credit funds with the companies set out in recommendation (2) of the report be agreed;
c) the committee seek more information on the investment options set out and hold a briefing session with Mercer Ltd and fund managers in the near future to help them to understand fully the options available;
d) reports from Mercer Ltd be received on a quarterly basis;
e) the progress made on ACCESS be noted; and
f) the intention to focus on Environmental, Social and Government (ESG) issues at the February meeting be noted.