Institutional Shareholders Committee (ISC) issues new code on the responsibilities of institutional investors
On 16 November 2009, the Institutional Shareholders Committee issued its Code on the Responsibilities of Institutional Investors.

This new code forms part of efforts to help investors become more effective in their dealings with companies in which they invest and sets out best practice with regard to monitoring companies, dialogue with company boards and voting at general meetings

The Code is aimed at those institutions that choose to engage with companies as part of their investment strategy and links strongly with Principle 5 of the new Myners principles.

The ISC code is voluntary and will operate on a comply-or-explain basis. Those adopting the Code are asked to disclose how they apply its principles and what steps they have taken, or intend to take, to verify their compliance.

Firms which comply-or-explain against the Code and provide a link to their policy statement will be listed on the ISC website. The ISC envisages that this list will become an important source in helping inform pension fund decision-makers and other stakeholders on the scheme managers’ approach to engagement.

The code, which also forms part of the final report of the Walker Review of Corporate Governance of the UK Banking Industry, is available to download at www.institutionalshareholderscommittee.org.uk/library.html.

(Posted 27 November 2009)

FRC publishes its findings from the responses to “The Financial Reporting of Pensions”
The Accounting Standards Board (ASB) has today issued a report ‘The Financial Reporting of Pensions: Feedback and Redeliberations’.

The report is a follow-up to the January 2008 Discussion Paper (DP) ‘The Financial Reporting of Pensions’. It sets out the ASB’s redeliberations and recommendations following the comments received during the consultation process. The objective is to provide the International Accounting Standards Board (IASB) with recommendations on matters it might consider in developing a future financial reporting standard on pensions.

The report has, in the main, affirmed the views set out in the DP. In particular:

• that the discount rate used should reflect the time value of money, and therefore should be a risk-free rate.
• that only present obligations be recognized as liabilities
• that these should be based on current salaries plus any future increases in respect of which there is a constructive obligation
• that assets held to pay pensions should be reported at current values
• that the objective of pension scheme financial statements is to provide information about the financial position, performance and changes in financial position of a scheme that is useful to members, and those who act in their interests, in making economic decisions and assessing the stewardship of trustees
• that the financial statements should recognize the liability to pay future benefits (although further work is needed to ascertain the potential costs of this change)
• that, in principle and despite a number of practical difficulties, the value of the employer’s covenant should be recognized as an asset in the pension scheme financial statements. Should the practical difficulties prove insurmountable, the preferred alternative is for narrative disclosure explaining how the difference between assets and liabilities will be funded.

Further information including the full report can be found at http://www.frc.org.uk/asb/press/pub2173.html

(Posted 20 November 2009)

CIPFA Pensions Panel Newsletter
The latest version of the Pensions Panel Newsletter is available to download here alongside past issues.

(Posted 2 November 2009)

CIPFA Pensions Panel Meeting 18 September 2009
The CIPFA Pensions Panel met on 18 September 2009. Please click here to download a note of the proceedings.

(Posted 26 October 2009)

CIPFA survey on Long-term Responsible Investment (LTRI) and Environmental, Social and Governence (ESG) issues in Local Government Pension Scheme (LGPS) investments

In November 2007, CIPFA, the LAPFF and UKSIF jointly launched the Environmental, Social and Governance (ESG) issues for Pension Funds self-assessment template to help funds assess how well they were addressing LTRI and ESG matters. Some two years down the line, we are keen to determine to what extent the template has been adopted by funds and the extent to which LTRI and ESG issues have become further embedded within LGPS investment strategies.

The survey is available to complete online at  
https://www.surveymonkey.com/s.aspx?sm=o4oV_2b2Ss2d33x_2fUbCYWubQ_3d_3d. Alternatively you can download a hard copy of the questionnaire click here and return the completed form to:

Nigel Keogh
CIPFA
3 Robert Street
London
WC2N 6RL

All responses will be treated in the strictest confidence, and any and all information supplied will be used only for the purposes of compiling a report on the findings. All information will be used at summary level only and no individual organisation’s responses will be identifiable in the report without prior agreement. Please take care to complete the contact details in full as all participating organizations will receive a summary of the findings.

If you have any questions regarding the survey, please do not hesitate to contact me nigel.keogh@cipfa.org.uk and thank you in advance for your participation. The deadline for responses is Friday 6 November 2009.

(Posted 23 October 2009)

CIPFA response to proposed changes to Local Government Pension Scheme
CIPFA has responded to proposed amendments to the Local Government Pension Scheme (Management and Investment of Funds) (Scotland) Regulations 1998 and the Local Government Pension Scheme (Administration) (Scotland) Regulations 2008. Learn more

(Posted 21 September 2009)

More news from the CIPFA Pensions Panel
For more news from the Panel please refer to the News Archive.