Issue - meetings

The item was introduced by Paul Higginbotham (Investment Analyst) The portfolio had increased in value by 0.7 per cent, which represented just under £3billion and was above target despite a quiet last quarter. There had been an increase in investments into private market assets, predominantly through Border to Coast in private equity infrastructure and private debt. There were significant inflows from older private markets, which were now starting to distribute assets from their funds. These were expected to be circulated back into Border to Coast.

Regarding cashflow, it was anticipated income received in 2026 would be £23.7million, compared to the current negative position. At the end of September the Fund’s cash balance was £57.5 million, which was invested in Lloyds and via the BlackRock money funds.

There were no updates regarding voting. It was anticipated the next update would have more information on voting relating to investments and how they affected the Fund’s Environmental, Social and Governance arrangements.

The latest funding level was 146 per cent. Paul Higginbotham said the funding level was slightly flattering given the current level of interest rate, although this was leading to larger and better investment returns. This had allowed the Fund to move into more diverse asset classes like private equity and private debt infrastructure.

Dapo Shonola said the government had announced it would be extending the guarantee for further education, meaning that if a sixth form or further education setting that was covered under the government guarantee went bust then any deficits would be covered. There were two eligible colleges covered by the Warwickshire Fund, although they both had more assets than liabilities at the last triennial valuation in March 2022.

Councillor Ian Shenton noted the Fund had often voted against proposals relating to Legal and General and asked if there were any reasons for this. Paul Higginbotham said many of these votes related to remuneration and share packages, or people being denied salaries or share bonuses. He said more detail could be provided in the next update. The Chair said he thought the votes were more likely to relate to governance issues, although he stated his belief Legal and General were more active on ESG issues.

Responding to a question from Beverley Farmery regarding cashflow, Dapo Shonola said the cash inflows and outflows used in the cashflow model were based on expected capital drawdown and distributions from fund managers, so the cashflow review could therefore largely be predicted to be correct.

It was noted there was a typo in section 2.2 of the report, and the phrase climate opportunities fund should be used instead of UK opportunities fund.