London fund preps to move £125 million into low carbon strategy

The £1 billion Hammersmith & Fulham Pension Fund is in the final stages of allocating approximately £125 million to a passive low carbon global equity fund.

The fund, which is part of the Local Government Pension Scheme (LGPS), plans to invest in a suitable strategy from Legal & General, said director of pensions and treasury, Phil Triggs. However, it is still considering options for transferring the assets. It has estimated that using a transition manager would cost approximately £800,000, while selling out to cash would cost £1.4 million.

The UK equity mandate is accessed through the London CIV, the pooling vehicle launched by London’s 33 local authorities in 2015.

An option for Hammersmith & Fulham is the National LGPS Transition Management and Implementation Service which has been widely used by LGPS funds and is managed by Norfolk County Council. The London CIV was a founding member of the framework, which would allow the Hammersmith & Fulham scheme to use the framework free of charge. However, the fund is currently not signed up to the framework, Triggs disclosed. In order to join the framework, the fund would have to sign the framework agreement, which is currently being reviewed by Eversheds Sutherland and its in-house legal team.