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Analysis of the Fund’s 2021 annual report by Fossil Free Greater Manchester shows the Fund increased its holdings of fossil fuel shares between 2019 and 2020, undercutting its claims it has made moves to divest.


The Greater Manchester Pension Fund (GMPF) bought more shares in fossil fuel companies between 2019 and 2020, undermining claims it has taken steps to divest from fossil fuels, new analysis shows.

Fossil Free Greater Manchester (FFGM) analysts looked at the GMPF’s holdings as of 31 March 2020 to identify the total value of shares the Fund held in individual fossil fuel companies. They calculated the number of shares by dividing this total, for each company, by the price of one share. They then repeated the same exercise with the GMPF’s holdings as of 31 March 2019 to find out whether investments had increased or decreased.

Holdings in Glencore, a commodity trading and mining company, went from 49,877,281 shares in 2019 to 70,972,447 in 2020, representing a 42.3% increase. Holdings in BP, the oil and gas giant, went from 57,607,529 shares in 2019 to 68,302,448 in 2020, representing a 18.6% increase. Finally, mining company Anglo American holdings went from 5,553,132 shares in 2019 to 6,360,400 in 2020, representing a 14.5% increase.

The findings undercut claims made by councillor Brenda Warrington, who as head of the administering local authority Tameside Council chairs the Fund, in the Fund’s 2020 Annual Report that it had taken steps to divest from fossil fuel companies.

Councillor Warrington wrote in the Annual Report: “A key element of our commitment to an orderly transition to a low carbon economy has recently been implemented, involving the replacement of £2.5 billion of GMPF’s passive, index tracking investments, with an enhanced approach that has significantly reduced GMPF’s exposure to carbon emissions and intensity. This is the biggest divestment by any Local Authority taken anywhere in the UK.

But divestment campaigners, while welcoming GMPF’s transfers of those investments from passive equity funds which invest in fossil fuels to a low carbon fund, point out that this ignores the direct holdings in fossil fuel companies which are far bigger, and increasing. In a comment, FFGM said:

“GMPF implies that this is a divestment of £2.5 billion. Yet as we have shown, it is only worth approximately £100 million of actual divestment from fossil fuel stocks. This is small in comparison with the Fund’s £860 million of direct shareholdings in oil, gas and coal mining companies.”

The figure of £860 million FFGM says is based on March 2020 figures.

In February, it was revealed GMPF was the biggest investor in fossil fuels of any Local Government Pension Schemes (LGPS) in the country, with more than £1 billion invested directly in oil, gas and coal stocks in the financial year 2019-20.

Fossil fuel companies are also among those receiving the most investment from the Fund in its portfolio of investments. The GMPF holds £244 million in Royal Dutch Shell, the largest investment by GMPF into a company in its portfolio, swiftly followed by BP in second place with £235 million in direct holdings. Of the top 20 companies in GMPF’s investment portfolio, five are gas or oil companies.

The GMPF opposes divestment on the basis of its fiduciary duty to get the best returns for employers and pensioners. In its 2019 Annual Report it claimed it made “over £400 million more in returns than if it had divested from equities in companies such as BP or Centrica, formerly known as British Gas.”

A growing body of evidence is making that claim difficult to sustain. Last year research by environmental think tank Platform London found £375m had been wiped off the value of the GMPF between 2016 and 2019 due to its oil and gas investments.

The Fund’s 2020 Annual Report also shows its investment performance fell below that of the other LGPS’s in 2020-21. On average LGPS’s suffered a 4.8% drop in their investment returns in 2020-21, whereas GMPF suffered a 6.6% loss.

There is growing evidence that divestment, far from representing a financial risk, is a sensible financial decision for pension funds.

In April, American asset management firm BlackRock conducted research into divestment on behalf of two public sector pension funds, the New York City teachers’ and public employees’ retirement funds, which were considering divestment and wanted to understand the financial risk. BlackRock concluded that portfolios “experienced no negative financial impacts from divesting from fossil fuels. In fact, they found evidence of modest improvement in fund return.”

Tameside Council have been contacted for comment but had not replied at time of publication.

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  • Alex King

    Alex is a reporter at Planning Magazine. Prior to working there he was a freelance journalist specialising in climate, employment and politics. His work has appeared in The Guardian, The Independent, Politico, Novara Media, Tribune Magazine, The Bristol Cable, The Mill and Red Pepper. He also set up and co-manages Green New Deal Media, an independent media outlet based in Greater Manchester devoted to addressing climate breakdown.

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