The Environment Agency Pension Fund (EAPF) has been criticised by campaigner Feargal Sharkey for investing in UK water companies that are also subject to investigation by the Environment Agency.
Commenting on Twitter, Sharkey said that six of England’s sewage companies are currently under investigation by the Environment Agency and Ofwat, and the EAPF has investments in three of those companies.
Sharkey added that Emma Howard Boyd, chair of the Environment Agency, was “until the last few weeks” chair of the EAPF Investment Sub-Committee.
A spokesperson for the EAPF told Room151 that it was “legally separated” from the operational and regulatory functions carried out by the Environment Agency. Exposure to UK water company investments is managed externally by the Brunel Pension Partnership (BPP) LGPS pool.
The spokesperson added that Howard Boyd had stood down as chair of the EAPF Investment Sub-Committee in November 2020.
Through BPP, the EAPF invests in water company bonds managed by Royal London Asset Management (RLAM). RLAM told Room151 that it engages directly with companies in the portfolio on issues such as droughts, flooding, flood infrastructure and biodiversity.
EAPF investments in water companies, through RLAM, are worth £37m, which represents 0.8% of the £4.5bn value of the fund’s total assets as of March 2022.
A spokesperson for BPP added: “Pension pools have been regularly asked by the UK government to invest in UK infrastructure to improve sustainability performance – that capital is crucial to enabling companies to improve. Inevitably, UK infrastructure has strong connections to local government, and therefore to Brunel’s clients.”
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