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ENGAGEMENT SUCCESS: BORDER TO COAST HIGHLIGHTS STEWARDSHIP IN ACTION

Posted on August 19th, 2025

Local Government Pension Scheme (LGPS) pool evidences positive impact of engagement in mitigating risks in its annual Responsible Investment and Stewardship Report.
Outlines continued progress in managing the financial risks of climate change and supporting energy security in its 2025 Climate Change Report.

Border to Coast Pensions Partnership has published its annual responsible investment reports demonstrating the positive impact of its engagement as an active steward of LGPS Partner Funds’ assets.

Two annual reports, the Responsible Investment and Stewardship Report and the Climate Change Report demonstrate the pool’s investment philosophy in action for the year to 31 March 2025.

In its Responsible Investment and Stewardship Report, Border to Coast reveals it undertook 1,919 engagements with companies, on a range of critical long-term issues including risks associated with business strategy and governance (41%), social issues (20%), and environmental considerations (31%).

The pool reports clear success in the period, including in its key engagement themes (for more on the four themes see pg20-26):

Engagement theme spotlight: Waste and Water Management (pg23)

Border to Coast collaborated with Royal London Asset Management (RLAM) to engage with 11 water utility companies held within its fixed income funds, leading the engagement with Yorkshire Water and Northumbrian Water. Results of the engagement were strong, with both companies making improvements across all focus areas including sewage pollution, water leakage, and nature-based solutions and biodiversity. Border to Coast also supported engagement with United Utilities and raised place-based concerns including sewage discharge into Lake Windermere. Subsequently, it welcomed new infrastructure investment and stakeholder partnerships to improve Lake Windermere’s water quality.

Border to Coast believes businesses with strong governance, diverse leadership, and a commitment to sustainability are more resilient – an essential quality that can support stronger long-term company performance and stronger outcomes for both LGPS members and employers, and taxpayers.

Further examples of successful engagements include:

International Hotels Group (IHG) (pg24) –through Border to Coast’s engagement partner Robeco, IHG introduced mandatory labour due diligence standards for its hotels and extended its human rights approach to include freedom of association, wages, working hours, and worker health and safety.
Shell (pg22) – following direct engagement by Border to Coast, Shell adopted a new 2030 emissions reduction target for oil production, aligned with net zero. However, it remains in engagement with the oil major as a similar target was not forthcoming for gas production. Border to Coast highlighted the stranded asset risk of Shell’s planned expansion of LNG production.
Panoro Energy (pg21) – Border to Coast engaged this oil and gas company with operations in Africa on its transition strategy considering Just Transition principles. We requested the adoption of targets for Scope 1 and 2 emissions reductions and disclosure of relevant Scope 3 emissions and were pleased to see Panoro Energy adopt a 50% reduction target for Scope 1 and 2 emissions intensity by 2030 and disclosure as requested.
Heidelberg Materials (pg26) – engagement through Border to Coast’s engagement partner Robeco focused on mitigating the risks of exposure to companies operating in conflict-affected or high-risk areas. Following engagement, Heidelberg strengthened its human rights systems, including more transparent performance tracking.

“Environmental, social and governance factors are not a ‘nice to have’ for investors, they are fundamental drivers of financial value. We stand by our belief that active engagement with companies is the most effective way to influence real change. Our reports demonstrate the success of our approach to date and highlight how implementing robust responsible investment policies can help mitigate long-term risk and secure long-term value for Partner Funds.”

Colin Baines, Stewardship Manager, Border to Coast

In its annual Climate Change Report, Border to Coast demonstrated how it manages the financial risks of climate change and its continued progress against its Net Zero Roadmap. With £8.2bn invested on behalf of Partner Funds in supporting the energy transition across equity, fixed income, and private markets, the report highlights how Border to Coast finds strong value and long-term return opportunities investing in funds supporting energy security and reductions in emissions, for exampleNational Grid and California Bioenergy (Climate Change Report: pgs25&26).

The report reveals the pool has reduced financed emissions by 66% for in-scope assets on 2019 levels, ahead of its target to have reduced levels by 53% by 2025. It also now has under engagement companies responsible for more than three-quarters (78%) of financed emissions.

Teju Akande, Climate Change Manager, Border to Coast, said: “The scale and sophistication gained through pooling enables a powerful collective response to manage the financial risks posed by climate change. We continue to engage the highest emitters in our portfolios effectively, helping to drive change that ultimately safeguards long-term value for Partner Funds.”

Both reports are available to read online now.

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