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At Wiltshire Pension Fund, we embed responsible ownership into everything we do. We understand that diversity and inclusion are not just buzzwords, but serve as integral values that drive progress and prosperity.
Definitions:
Diversity is the representation of a range of traits and experiences in a company's workforce.
Inclusion is about individuals feeling welcome, safe, and valued. A Workforce may be diverse but if not inclusive the company will not perform to its highest potential.
The Fund regards EDI as an important ESG (Environmental, Social, and Governance) factor, a stewardship priority, and an area where investment managers should focus their voting and engagement efforts. Several pieces of research have shown that diverse boards lead to better financial outcomes (for example, this publication by the FRC). Consideration of EDI has also been embedded at an operational level within the Fund, and has been highlighted as an important area in the running of pension funds by the Pensions Regulator.
Recently all employees at Wiltshire Pension Fund attended a two-and-a-half-hour session on 'Creating an Inclusive Workplace', hosted by the Organisational Development team at Wiltshire Council. During this session the team successfully understood the meaning of inclusion and diversity, challenged stereotypes, understood unconscious bias, how to mitigate this bias, what it means to demonstrate inclusive leadership and put together an action plan for an inclusive environment. We hope that this training will actively contribute to a more inclusive workplace for our staff, and better outcomes for our scheme members. Since the workshop, the team set themselves a goal to promote inclusivity at a recent team building day.
EDI has also been acknowledged as a priority by our Committee and Local Pension Board, and both these groups have committed to receiving dedicated training on this topic later this year.
In practice and as part of our commitment to transparency, responsible investment, and meeting the evolving needs of our members, we initiated the "Wiltshire Pension Fund Youth Engagement initiative". We recently engaged with our younger members (aged <30) to better understand their expectations, preferences, and priorities regarding their pensions and how it is invested, whilst identifying how to best keep them informed of their benefits. This initiative was derived with inclusivity in mind, aiming to bridge the generational gap, improve our services, and align our communications with the values and concerns of the younger generation.
We recently engaged with one of our managers on this topic asking how they were applying these principles in a practical way, within the challenging area of emerging markets, read what they had to say in the section below.
Ninety One recognise the significance of long-term sustainability within their own internal working environment. To cultivate an inclusive and supportive workplace, they have established a network called Ninety One Proud, aimed at creating an internal community for LGBTQ+ individuals and their allies. During UK and US Pride Month celebrations, Ninety One Proud has orchestrated a campaign that honours LGBTQ+ colleagues through many inclusive initiatives.
When it comes to evaluating investments, Ninety One use their Sustainable Equity team's "Capital's Framework," which evaluates investments across natural capital, social capital, and human capital, and contains a culture assessment framework. This framework focuses on appraising corporate cultures and plays a pivotal role in Ninety One's assessment of human capital.
Within our portfolio, the largest pan-Asian life insurer, AIA Group, fosters inclusivity by offering training and resource packages to support the development of all employees, while actively promoting talent rotation across functions and regions. As at 30th June we held £7m in AIA Group (£2.5m with Ninety One and £4.5m with Brunel). This approach enhances communication networks and ensures equal opportunities for professional growth. The culture assessment framework enables them to identify inclusive workplace practices that support individuals of diverse gender, race, and sexual orientation, including those who identify as LGBTQ+.
Navigating Diversity and Inclusion in Emerging Markets:
We were also interested to understand how LGBTQ+ inclusion can be maintained in emerging markets. Ninety One acknowledge that some of the emerging markets in which they invest may exhibit public opinion and policy that are adverse to LGBTQ+ rights. And engaging in conversations about enhancing inclusion within these businesses can be challenging. However, Ninety One's culture assessment framework enables them to look beyond diversity numbers and scrutinise whether a company genuinely offers an inclusive workplace, ensuring equal opportunities and developmental support for all individuals.
We will maintain an ongoing dialogue with our investment managers to gain a clear understanding of how they incorporate the 'S' (social) aspect of ESG criteria. This will help us ensure genuine inclusivity and a strong commitment to diversity and equality, both in the workplace and in their investment decision-making processes.
