A multi-billion-pound public sector pension fund is exceeding a greenhouse gas reduction target year on year, a meeting heard.
Dyfed Pension Fund, whose members includes council and other public sector employees in Mid and West Wales, was valued at £3.46bn in March 2024.
Around 65-70% of this portfolio is invested in equities – or stocks and shares – and a decision was taken years ago to reduce equity exposure to carbon-intensive companies by 7% per year compared to the fund’s baseline figure in September 2020.
Anthony Parnell, treasury and pension investments manager at Carmarthenshire Council – host authority of Dyfed Pension Fund – told a meeting that exposure to carbon-intensive companies had fallen by an average of 13.9% per year between September 2020 and March 31, 2025. This figure factors in a lower fall of 10.7% during the 2024-25 financial year.
“It’s going in the right direction,” Mr Parnell told the Dyfed Pension Fund committee, which helps oversee the fund.
Referring to the 7% per annum target Mr Parnell said: “So we have overshot that and we continue to work to reduce that further going forward.”
The pension fund, like many others, has faced pressure from campaigners in recent years to reduce investment in high greenhouse gas-emitting sectors.
The Dyfed Pension Fund committee meeting went on to hear about ongoing work to encourage “responsible investment” by an umbrella group called Wales Pension Partnership (WPP), which pools together investments of eight public sector pension funds including Dyfed’s.
WPP employs a firm to do this engagement work on its behalf, such as encouraging more responsible production of palm oil, which a committee report said was linked to deforestation and biodiversity loss.
The firm – Robeco – has engaged with household names such as BP, Shell, Starbucks, Samsung Electronics and Tesla on various topics, the report said.
