UK – The roughly £3.3bn (€4.8bn) London Pension Fund Authority will review its investment in arms manufacturing companies at a public board meeting next week.

The decision follows media coverage earlier this year in which the fund was slammed by critics, including Mayor Ken Livingstone, for investing roughly £12m in some of the world’s largest arms manufacturing companies, including BAE, Boeing and Northrop Grumman.

The scheme was one of several UK local authority pension funds, which have more than £700m invested in the industry, according to shareholding figures obtained by the Campaign Against Arms Trade (CAAT).

“We are, of course, aware of our investments in arms manufacturers and the interest in the press naturally led us to review the position in line with our responsible investment policy,” LPFA chief executive Peter Scales told IPE.

“At the same time, we are moving to gear up the implementation of our policy having just appointed a new bunch of investment managers,” he added, referring to a review of the fund’s investment strategy at the end of 2005.

The LPFA’s investment committee met last week to discuss the matter, and consider responses from managers and the Greater London Authority. However, the committee felt that this was rather a topic for all members to consider at the board meeting to be held next Thursday in London.

“The sums involved are relatively small, £12m out of £3.3bn and the holdings are not inconsistent with global benchmarks. However, that is not really the point,” said Scales.

“LPFA is a long-term responsible investor and wishes to ensure that its policy of engagement and collaboration is as effective as possible within the rules under which we operate.”

CAAT welcomed the news that the LPFA was taking the matter seriously and reviewing its investment. “We hope that it decides in Thursday’s meeting that disinvestment from arms companies is the only acceptable way forward,” said a spokesperson.

The recruitment of a new chief executive and investment director for the LPFA will also be discussed next Thursday ahead of Scales’ retirement at the end of the year.

Scales told IPE that neither of the posts had been filled yet. Interviews for the CEO post are due to be held next week, while potential candidates for the investment director position will be held in July.