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Lancashire fund makes 53 appointments to investment framework

The Lancashire County Pension Fund (LCPF) has made 53 appointments to its investment consultancy framework as the local government pension scheme (LGPS) gears up for its new partnership.

The £5.3bn (€7.4bn) scheme for public sector workers in Northwest England is in the process of creating an “asset-liability partnership” with the £4.8bn London Pensions Fund Authority (LPFA), resulting in the need for investment advisory services.

As it begins to shift assets into the collective fund with the LPFA, it has hired consultants to a framework agreement covering public equities, credit, infrastructure, real estate, private equity, governance, risk management and macroeconomic analysis.

It hired Allenbridgeepic Investment Advisers, Aon Hewitt, bfinance, CBRE Global Investment Partners, Hymans Robertson, Institutional Investment Advisers, JLT Benefit Solutions, Mercer, Redington, Russell Investments, PwC and Stepstone Group across 53 different arrangements. (see table)

LCPF investment consultancy framework
Public EquityCreditInfrastructureReal Estate
Allenbridgeepic Investment AdvisersAllenbridgeepic Investment AdvisersAllenbridgeepic Investment AdvisersAllenbridgeepic Investment Advisers
Aon HewittAltius AssociatesAon HewittAon Hewitt
bfinanceAon Hewittbfinancebfinance
JLT Benefit SolutionsbfinanceInstitutional Investment AdvisersCBRE Global Investment Partners
MercerInstitutional Investment AdvisersJLT Benefit SolutionsJLT Benefit Solutions
Russell InvestmentsJLT Benefit SolutionsMercerMercer
 MercerRussell InvestmentsRussell Investments
 RedingtonStepstone GroupStepstone Group
 Russell Investments  
 Stepstone Group  

 

LCPF investment consultancy framework
Private EquityGovernanceRisk ManagementMacroeconomic Analysis
Allenbridgeepic Investment AdvisersAllenbridgeepic Investment AdvisersAon HewittAon Hewitt
Altius AssociatesAon HewittJLT Benefit SolutionsJLT Benefit Solutions
Aon HewittHymans RobertsonMercerMercer
bfinanceMercerPwC 
JLT Benefits SolutionsPwCRedington 
Mercer   
Stepstone Group   

Launching the tender in December, Lancashire County Council said it would review various aspects of the fund’s investments and conduct mini-competition exercises as and when required, appointing the most “economically attractive” consultant.

This is the second framework agreement LCPF has set up to manage its “partnership” with LPFA, after announcing the winners for a transition management model last month.

The pension fund will use BlackRock Advisors, Citigroup, Goldman Sachs, Legal & General Investment Management, Macquarie Capital, Nomura, Northern Trust and Russell Implementation Services, using a similar mini-competition model when required.

The LCPF and LPFA announced the new partnership last year with the view to pooling investments, cutting costs and improving governance. 

Both funds have internal asset management capabilities that will now merge, alongside liability management strategies and administration.

The partnership came as the UK government considered responses to a consultation on whether to create collective investment vehicles (CIVs) for the 89 LGPS funds in England and Wales, potentially forcing all funds to invest only in passive listed assets.

Both the LCPF and LPFA suggested increased fund collaboration on governance and liability management was more appropriate than a mandatory shift to passive investing, and a focus solely on investment fees.

A government response has been delayed and is now expected after May’s general election, due to friction within government departments.

Some LGPS funds with internal asset management capabilities are considering legal action against the UK central government should it force schemes to invest via CIVs.

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