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Local Government Superannuation Scheme

PRI reporting framework 2017

You are in Strategy and Governance » Investment policy

Investment policy

SG 01. RI policy and coverage

New selection options have been added to this indicator. Please review your prefilled responses carefully.

01.1. Indicate if you have an investment policy that covers your responsible investment approach.

01.2. Indicate the components/types and coverage of your policy.

Select all that apply

Policy components/types

Coverage by AUM

01.4. Indicate what norms you have used to develop your investment policy that covers your responsible investment approach.

01.6. Provide a brief description of the key elements, any variations or exceptions to your investment policy that covers your responsible investment approach. [Optional]

LGS has a Sustainable & Responsible Investment Policy, located on the website at https://www.lgsuper.com.au/assets/Documents/LGS-Sustainable-and-Responsible-Invest-Policy.pdf, and last updated on 1/5/2015. 

This Sustainable and Responsible Investment Policy (‘The Policy’) recognises that LGS is long term in nature, and that the long term prosperity of the economy and the wellbeing of members depends on a healthy environment, social cohesion and good governance of LGS and the companies in which it invests.

As a universal investor with index holdings, LGS has an interest in all major companies in Australia and internationally. This Policy sets down the sustainability principles by which LGS will be managed, and the requirements for all investments made by LGS. It covers the total investment portfolio, with specific policies for public and private equity investments and direct property. The Policy includes the list of collective engagement initiatives that LGS will participate in, and the ESG risk assessment that will be required of LGS’s asset consultant and investment managers. 

  


SG 02. Publicly available RI policy or guidance documents

New selection options have been added to this indicator. Please review your prefilled responses carefully.

02.1. Indicate which of your investment policy documents (if any) are publicly available. Provide a URL and an attachment of the document.

02.4. Additional information [Optional].

 

 


SG 03. Conflicts of interest

03.1. Indicate if your organisation has a policy on managing potential conflicts of interest in the investment process.

03.2. Describe your policy on managing potential conflicts of interest in the investment process.

The Trustee Board has ultimate responsibility for the oversight of conflicts management and adopts a comprehensive approach to managing situations where a conflict may arise. The same approach is applied throughout the organisation. The Trustee retains overall responsibility for ensuring that arrangements, policies and processes for managing and monitoring conflicts are in place and Responsible Persons understand their obligations. 

The policy has identified a three stage approach as outlined below:

  1. Identify the conflict – what are potential or actual conflicts, and how they may arise in the Trustee’s normal business operations.
  2. Manage and assess the conflict – in accordance with the principles in this policy.
  3. Disclose the conflict – in accordance with the principles in this policy, including detailed registers. In some cases, conflicts may arise between different classes or types of Scheme members or beneficiaries.

This Conflicts of Management Framework requires that all members and beneficiaries be treated equitably. Conflicts are not limited to financial matters and care is taken to protect confidential information.

03.3. Additional information. [Optional]


SG 04. Identifying incidents occurring within portfolios

04.1. Indicate if your organisation has a process for identifying and managing incidents that occur within portfolio companies.

04.2. Describe your process on managing incidents

          Incidents require a review by internal Sustainability staff as well as Chief Investment Officer.  The appropriate fund manager would then be called upon to explain how this incident was being dealt with e.g. divestment, management out of asset or otherwise.  Questioning would relate to how the incident could be avoided in the future and how the relevant fund manager was building this process into asset assessment.
        

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