A report of the Director of Finance
The Committee considered a report of the Director of Finance on the Fund’s Risk Register and Risk Management Policy.
The Committee was informed that Risk management was good practice and central to the management of the Pension Fund, as reflected by the coverage of risk in several key documents, such as the Funding Strategy Statement and the Investment Strategy Statement. Officers reviewed the risk register every quarter, focusing in on the detail of one of four key areas, (Governance, Funding, Administration and Investment), along with a review of any emerging risks.
The Committee heard that as part of the review, Members of the Local Pensions Board attend the review meetings and took an active role in the discussions. They also discussed the specific area under review each quarter at formal board meetings, in an effort to widen the general understanding of each area. The Board’s comments on the Risk Register and the review process were attached at Appendix 1 to the report. It was also suggested that the Committee may wish to consider asking members of the Local Pensions Board to continue with their role in the ongoing review process.
The Committee were presented with a summary of the high-level risks associated with the objectives, attached at Appendix 2 of the report. This summarised the highest score of the detailed risks associated with each of the high-level risks and provided a summary of the controls and sources of assurance currently in place. This was intended to give the Committee an overview of the main risks the Pension Fund needed to consider and the controls in place to mitigate them.
The Committee were reminded that as part of the annual review, it was agreed that the Pensions Committee would review emerging risks to the Fund. It was important to recognise that some of the greatest risks faced by the Pension Fund arose from change. Several transitional areas were reflected in Appendix 3 to the report, which provided more detail on the emerging risks perceived to be faced by the Pension Fund.
The Committee was informed that the Pension Regulator’s Code of Practice recommended that a Pension Fund has a Risk Management Policy in place, and that this was reviewed periodically. The risk management policy covered key areas such as:
• The Fund’s attitudes to, and appetite for, risk;
• Risk measurement and management;
The updated Risk Management Policy for the Staffordshire Pension Fund was attached at Appendix 4 to the report and was submitted for approval.
Resolved: a. That the summary of the high-level risks and emerging risks from the current Staffordshire Pension Fund Risk Register, as presented in Appendices 2 and 3 respectively be noted.
b. That the content and recommendations of the Local Pensions Board review of the Staffordshire Pension Fund Risk Register, attached at Appendix 1, and the continued involvement of the Pensions Board in the ongoing review, be noted.
c. That the Risk Management Policy of the Staffordshire Pension Fund, attached at Appendix 4, be approved.