The Wales Pension Partnership has established a new decarbonisation initiative across the £2.5 billion of its global equity assets managed by Russell Investments.
The investment pool’s global equity mandate will achieve a target reduction of 25% in both its carbon footprint and fossil fuel reserves exposure relative to its benchmark.
The portfolio will also exclude companies that rely on coal to generate revenues.
The Wales Pension Partnership, which represents the nation’s eight LGPS funds, is utilising Russell Investments’ Enhanced Portfolio Implementation infrastructure to achieve its decarbonisation targets.
The infrastructure leverages a centralised trading and portfolio management process, with Russell responsible for executing the investment strategies of the partnership’s underlying fund managers.
Councillor Glyn Caron, chair of the joint governance committee at the Wales Pension Partnership, said: “Climate change not only poses significant challenges for society; it also represents a financial risk for our constituent authorities and scheme members. By reducing the carbon exposure within our active equity assets, in partnership with Russell Investments, we are seeking to address these challenges. We see this as a positive first step in meeting our long-term sustainability goals.”