Insight Exchange: Elizabeth Carey

Published: October 10, 2025

Interviewee:

Elizabeth Carey
Independent Investment Adviser

LAPF Investments speaks with Elizabeth Carey to discuss some of the issues shaping the sector

Elizabeth serves as independent investment adviser to two LGPS funds. In this capacity, she advises on a wide range of topics including private markets, strategic asset allocation, liquid asset classes, multi-asset, performance evaluation, currency mis-match, liquidity considerations, funding levels, responsible investment/stewardship and risk management. Elizabeth draws on her decades of experience working at two investment banks in the US and London, as well as a senior in-house M&A role at a large US industrial conglomerate. Alongside working for her LGPS clients, Elizabeth speaks at selected LGPS-related conferences and frequently serves on judging panels for the UK investment management industry.

 

What is your current policy for investing in defence?
Defence is a policy area where LGPS funds generally adopted investment manager baseline restrictions without much interrogation or push-back. Baseline policy excluded companies producing “controversial” weapons like land mines, cluster bombs, chemical or nuclear weapons. Pools have largely continued this approach, choosing to focus RI resources and engagement on environment/climate, social and governance themes. Defence has been the “poor relation”, taken for granted and ignored despite its vital importance to capital markets, communications, industry, society, sustainability and democracy.

How can committees navigate conflicting pressures and challenges versus expectations to support national defence?
Simplistic thinking rarely offers solutions. Energy company divestment does not address climate change. Government-imposed sanctions (e.g., Russia, Belarus) can help to weaken an aggressor over time. Divestment from companies linked to conflict zones is virtue signalling that doesn’t help civilian victims. Committees should acknowledge the complex relationship between military hardware and technology suppliers, global supply chains for military and dual-use assets, and political realities regarding both sides in a conflict. Parliamentarians can enact export restrictions or sanctions where practicable.

“Total defence” includes protection of the whole of society against catastrophes such as war, natural disasters, and other strategic crises. When thinking about this wider definition, what policies or investment approaches do you have in place? Is this likely to change?
No explicit policies are in place, but they are surely needed. The defence capabilities of Western-style democracies enable functioning capital markets and civil society built on rule of law that delivers predictable, fair legal outcomes, hence “investibility”. If needed, democracies must be willing to use force effectively and collaboratively to defend against aggressors. Necessary defence capabilities encompass skilled humans plus civil infrastructure including undersea electricity and telecommunications cables; critical rail links, airfields and roadways; satellites, high specification hardware, software and cybersecurity; precision missiles and drones, tanks, submarines and ships; intelligence capabilities and more. Strong defence underpins UN’s SDG 16… and enables all the others. Taken for granted for too long, Putin’s invasion of Ukraine is swiftly changing dangerously complacent attitudes.

What challenges might LGPS funds encounter when seeking to implement their defence-related policies through their pool?
Newly strengthened pooling mandates mean that responsible investment policies and practice effectively lie at pool level, not with LGPS funds. Shifting a pool’s RI priorities requires collective engagement and determination from partner funds. By joining together to express their collective views to the pool’s C-suite and Head of RI, partner funds should indicate where policies need to be updated to reflect their evolving views on defence (and other matters) to make the pool RI policy approvable.

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