Agenda item

Report of the City Treasurer.

8.1       Matthew Hopson (Senior Finance Manager – Treasury) presented the report that provided an update on the governance review of the London Collective Investment Vehicle (CIV) and its key findings. He advised that a number of concerns had been raised in the review, the key concern of which surrounds the engagement of a wide stakeholder base with conflicting priorities, as the London CIV had 33 London borough members. This created difficulty in achieving joint outcomes and slowed progress in the pooling of funds and it was not felt that the Investment Advisory Committee and the Joint Committee were operating optimally to help improve this. There were also concerns regarding a perceived lack of transparency, particularly in respect of manager selection. Another issue of concern was that the London CIV was underfunded and under resourced, particularly in the areas of client relations and the Secretariat.

8.2       Matthew Hopson informed Members that the governance review had made 5 key recommendations, these being:

·         Establishing and agreeing a more concise and narrowly defined set of statements of purpose for the London CIV, the Investment Advisory Committee and the Joint Committee

·         Review the meeting cycle, reducing the number of full committee meetings and making greater use of sub-committees and working groups with each committee focusing on a clear set of objectives

·         A better resourced Secretariat

·         Recognising the importance of transparency and cultivating trust and to embed this for the CIV’s pooling arrangements

·         Setting up an independent resourcing and cost model review to provide further clarity and recommendations on the appropriate levels of funding.

8.3       Matthew Hopson commented that as the London CIV was founded on a voluntary basis, this hindered creating robust governance arrangements and there needed to be more uniformity.  He also advised that the Chief Investment Officer of the CIV had vacated the post and there were no immediate plans to replaced him. Members heard that the Department for Communities and Local Government was driving the requirement of local authorities to pool their funds with others.

8.4       Phil Triggs emphasised the importance of the London CIV to appoint a Chief Investment Officer at the earliest opportunity. One of the difficulties the CIV encountered was that the 33 London borough members all had different expectations and approaches.

8.5       The Chairman sought views on the recommendations in the report. Members asked if having too many London boroughs in the CIV was the inherent problem behind the lack of progress.

8.6       Alistair Sutherland replied that it was essential that the CIV carried the recommendations through and it was also important to appoint a suitably qualified Chief Investment Officer promptly. He stated that London boroughs needed to recognise that there needed to be compromises and there was no alternative than for the CIV to work.

8.7       The Chairman commented that it was regrettable that the London CIV had not made the same progress as other LGPS investment pools. He requested that the Interim Chief Executive of the London CIV attend the next meeting to update the Committee on the work of the CIV and progress in respect of appointing a new Chief Investment Officer.

8.8       RESOLVED:

            That the governance review be noted.