Strength in Size
We have circa £9 billion in assets under management, split between defined benefit and defined contribution pension schemes.
Our combined strength and size enables us to invest to achieve economies of scale, the benefits of which we pass on to our customers.
Each scheme has its own separate section at the Trust ensuring its assets and liabilities are ring-fenced, giving peace of mind.
Investment decisions are made by the Chief Investment Officer, the Investment Committee (a sub-committee of the Board) and our Investment managers.
Each plays a different role, ultimately working together to add long-term value for the common good of beneficiaries.
All monies are managed externally by third-party investment managers.
Our Investment Beliefs
1) Over the long-term, achieving a higher investment return requires taking higher risk (uncertainty in future returns).
2) Any risk should only be tolerated to the extent that the Trustee Board has confidence that the sponsoring employers have the resources to meet potential adverse asset-liability consequences in most circumstances.
3) Diversification of risky assets, both within and across asset classes, reduces the volatility of asset returns, both in absolute terms and relative to liabilities.
4) Asset allocation is more important to returns than manager or stock selection.
5) Equities are expected to outperform government bonds in the medium-term.
6) The real world is complex; judgement and qualitative research are at least as important as quantitative analysis.
7) Investor behaviour can result in market inefficiencies and opportunities for long-term investors, though finding investment managers who can consistently spot and exploit these inefficiencies is difficult.
8) Good trustee governance improves the quality of investment decision-making.
9) Responsible investment can enhance long-term portfolio returns.
10) Ethical investments (in any particular asset class) are likely to perform differently, either better or worse, than the universe of similar investments. However, we believe that members and employers should have the opportunity to opt for investments which reflect ethical concerns.