In a public meeting in Bath on 12 December the Avon Fund Pension Committee voted to maintain its current approach to investing in Aerospace and Defence.
Committee members voted 8 to 2 in favour of confirming its ‘in principle’ decision, taken in March 2025, to remain invested in the Aerospace and Defence sector. In addition, it noted the strength of the views expressed by Fund members and agreed to communicate them to its new investment pool, Local Pension Partnership Investments, to inform their investment policies.
After the meeting, Councillor Toby Simon, Chair of the Avon Pension Fund Committee, said:
“Committee members recognised that this is a difficult and sensitive issue, which is why the Committee sought member views through a survey, sought further legal advice, and has taken its time to reach a decision. Committee members showed their empathy with the many different and sometimes strongly-held views of stakeholders.
“The Committee has met and decided its approach, which is to remain invested in the Aerospace and Defence sector. We recognise that some stakeholders will be disappointed with this decision, but the committee believes it is the right decision given the further work undertaken.
“We note the strength of stakeholder views and agree to communicate them to our new investment pool, Local Pension Partnership Investments, which we will join in April, to inform their investment policies.
“The Fund takes all member views seriously and, in reaching a decision, the Committee has balanced those views with its wider fiduciary duty, legal advice, financial considerations, and the wider regulatory context with the evolution of pooling. The Committee is grateful for the time taken by members to respond to the survey and for wider input received from stakeholders.”
Since December 2024, the Pension Committee has received multiple petitions requesting the Fund divest from companies supplying Israel, triggered by concern about the conflict in Gaza and wider occupied territories.
The Committee initially considered these petitions at its meeting in March 2025, when it decided that, rather than focus specifically on Israel, it could compliantly address the issue by deciding whether the Fund should continue investing in the Aerospace and Defence sector. The Committee took the ‘in principle’ decision in March 2025 to remain invested, subject to seeking an assessment of member views through a survey alongside further consideration of the legal position.
Three subsequent developments informed the Pension Committee’s final decision on Aerospace and Defence investments:
- The Fund has undertaken a representative survey of its members’ views, led by an independent research provider.
- The Fund has received expert legal opinion.
- The UK government has published its Fit For The Future proposals, which shift key investment accountabilities from LGPS funds to their investment pools.
Papers for the meeting were published on 5 December and can be found here.
At the 12 December meeting, the Committee heard that any decision to exclude investment in Aerospace and Defence around non-financial factors would need to meet two conditions: 1) doing so would not involve significant risk of financial detriment to the Fund (the financial condition) and 2) there is good reason to think that scheme members would support the decision (the member support condition). The member support condition requires a “high proportion of those members with a view” to support the proposal.
The results of the member survey showed 42% supported divesting from Aerospace and Defence investments, 47% favoured remaining invested in Aerospace and Defence, and 11% were unsure.