Strategic Portfolio Reallocation to Enhance ESG Integration
In February and March 2024, the Plan fully exited its investment in the CQS Credit Multi Asset Fund. Subsequently, in May 2024, the capital was reinvested into the TwentyFour Strategic Income Fund. This multi-asset class mandate was selected because its manager actively incorporates Environmental, Social, and Governance (ESG) issues into its investment analysis and decision-making process, aligning with the Plan’s investment strategy objectives. (Source: TCFD Statement – DH&S Retirement and Death Benefits Plan, 1 April 2024 – 31 March 2025, page 2, 8, 11)
New Manager Appointment: TwentyFour Strategic Income Fund
In May 2024, the Plan made a new allocation to the TwentyFour Strategic Income Fund. This fund is a signatory of the United Nations Principle for Responsible Investment (UNPRI) and integrates ESG considerations into its investment analysis and decision-making. The Trustee placed significant emphasis on TwentyFour’s ESG capabilities during the selection process. (Source: TCFD Statement – DH&S Retirement and Death Benefits Plan, 1 April 2024 – 31 March 2025, page 11)
LDI Manager Granted Discretion for Green Gilts
The Plan has provided its Liability Driven Investments (LDI) manager with discretion to invest in green gilts within existing mandate guidelines. This is permitted when the manager believes it will be beneficial for performance, liquidity, or risk management. (Source: TCFD Statement – DH&S Retirement and Death Benefits Plan, 1 April 2024 – 31 March 2025, page 11)
Consideration of Euro-Denominated Bonds in Buy & Maintain Mandate
In 2024, the Trustee approved a proposal from Legal & General Investment Management (LGIM) to include Euro-denominated bonds in the opportunity set of the LGIM Global Buy & Maintain Credit Portfolio. This change was noted for its potential to benefit the portfolio’s climate alignment metric coverage. (Source: TCFD Statement – DH&S Retirement and Death Benefits Plan, 1 April 2024 – 31 March 2025, page 10)
Shift in Insight Buy & Maintain Mandate Structure
The Trustee switched the Plan’s exposure in Insight Investment’s segregated Buy & Maintain mandate to two pooled Buy & Maintain funds also managed by Insight. The ESG processes between both offerings were noted as consistent. (Source: TCFD Statement – DH&S Retirement and Death Benefits Plan, 1 April 2024 – 31 March 2025, page 10-11)
New Climate Metric Adopted: PCAF Data Quality Score
In February 2024, the Trustee adopted the Partnership for Carbon Accounting Financials (PCAF) Data Quality Score as an additional climate change metric. This metric monitors the reliability of companies’ emissions data, scoring them from one (highest quality) to five (lowest quality). The Trustee believes this metric provides useful context for interpreting emissions-based metrics and aids in reviewing data quality. (Source: TCFD Statement – DH&S Retirement and Death Benefits Plan, 1 April 2024 – 31 March 2025, page 6, 11, 17, 29)
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