Issue - meetings

Liz Firmstone (Head of Finance Transformation and Transactions) introduced this report which provided updated governance information including details of Warwickshire Pension Fund’s Forward Plan, risk monitoring, policies, and training. She highlighted that Climate Change and Cyber Security remained the highest areas of risk to the Pension Fund. Aon Hewitt had been commissioned to review and update the Fund’s Cyber Security Policy which would be presented to the Staff and Pensions Committee. She highlighted that at the meeting in March 2024, the Sub-Committee had asked if the risk ‘Long term asset values do not meet expectations’ could be reviewed. This review had been completed and the residual risk has been lowered to an amber rating. The risk rating for ‘Governance Failure’ had also been lowered to reflect the work being undertaken by the Fund to meet new governance requirements set out by the Pension Regulator and Scheme Advisory Board. She thanked members for completing the Knowledge and Skills Assessment.

In response to Councillor Hammersley, Liz Firmstone advised that Cyber Security had been set as a red risk as new threats were constantly emerging in this area. The Fund would remain vigilant.

There was discussion of the methodology for determining risk scores and whether it would be possible to enact measures to lower the risk rating for Cyber Security.

Councillor Gifford praised the quality of recent Cyber Security training provided to the Sub-Committee. It had shown the presence of risks not just from computer hacking but also by phishing emails. Criminals would seek to make use of these sorts of avenues to penetrate otherwise secure systems. There had been some recent high-profile reports of public sector systems being compromised. He emphasised the need for constant vigilance.

Liz Firmstone stated that the updated Cyber Security Policy placed an emphasis on ‘cyber hygiene’ and the individual responsibilities of those working for the Fund. The Policy advocated consistency in messaging to ensure that there was an ongoing awareness of risks. It also examined the risks associated with moving data between systems.

The Chair highlighted that Climate Change was the top scoring risk. It was an issue which the Sub-Committee took very seriously.

Councillor Gifford highlighted the complexity of the risk presented by Climate Change. The Pension Fund was working towards a transition away from fossil fuels. This presented opportunities but also significant risks. It was appropriate for Climate Change to remain as the highest rated risk on the Risk Register. 

Resolved:

That the Pension Fund Investment Sub-Committee notes the contents of the report.