10 August 2001
Eight of the top ten schemes, which were judged according to how much emphasis they placed on ethical, social and environmental considerations when making investment decisions, were run on behalf of public sector organisations.
Of these, six were local authority schemes, including the Merseyside pension fund, the West Midland Metropolitan Authorities' fund, and those for Nottinghamshire and Lancashire county councils. The other two were the Universities Superannuation Scheme and the Environment Agency fund.
The survey, which did not rank the top ten, was conducted by environmental pressure group Friends of the Earth. It was prompted by an amendment to pensions legislation last year, which obliged fund trustees to publish a statement of investment principles outlining the extent to which ethical concerns governed investment decisions.
FoE's investment campaigner, Simon McRea, who carried out the research, said that, on the whole, local authorities had an 'active commitment' to ethical investment and tended to be more proactive than their private sector counterparts.
'They support collective action as the best policy to achieve the greatest possible impact on corporate behaviour,' he said. 'This may be partly due to the fact that local authorities are democratically accountable and so tend to be more responsive to the concerns of both their members and the local community.'
Schemes ranked in the top ten were found to have a robust statement of principles that recognised the importance of ethical considerations; a strategy for using voting rights to encourage corporate responsibility; and effective monitoring systems to ensure investments adhered to the policy.
Mandy Wright, policy officer with the local government Employers' Organisation, welcomed their strong showing in the survey. 'I would say it's because we are political organisations and therefore have a concern for political, social and environmental wellbeing, so it is compatible with the principles of ethical investment. Naturally we're very pleased at how well we've done in the survey.'
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