Bridport Peace and Justice Group

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Welcome to the web site of Bridport Peace and Justice Group.  We hope it becomes a useful resource for those, especially locally, who wish to work for a more peaceful and just world.

Bridport, Dorset, England.

Dear Mr Partridge

Dorset County Pension Fund

Thank you for interest in the activities of the Dorset County Pension Fund, in particular concerning investments in Halliburton. I can confirm that the Fund does invest in Halliburton, as part of a widely diversified portfolio containing holdings in more than 1000 companies world wide.

The Pension Fund Investment Committee has the overall responsibility for determining the strategy of the Fund, after receiving advice from the Fund Administrator and the Independent Adviser. The Committee meets with its advisers four times a year. The primary aim of the Committee is to maximise the value of investments made for the benefit of the many stakeholders, including the Council tax payers, employer bodies, the current employee contributors and pensioners. Although the individuals involved in the management of the Fund may take a different personal view on ethical, sustainability or political grounds, these must in law be put to one side in the management of the Fund.

I do, however, understand your concerns and would make a couple of points. Firstly, there are practical difficulties for the personal investor in stocks and shares in following 'ethical principles'. Most large companies will have very diverse business, some parts of which will be 'acceptable' and others not. In addition, some companies will make generic parts (nuts and bolts for example) which go on to be utilised by others for unknown purposes. Secondly, there is a strong argument that it is more effective to hold shares in such companies and use voting power to influence outcomes. Selling or not holding stocks has been shown to have little or no effect. For every seller there is a willing buyer. Our work on this topic in the past has shown that it would be very difficult to fairly operate 'ethical policies' that all (and not just some) of our stakeholders would sign up to.

I enclose a copy of the latest Pension Fund Annual Report which sets out how the Fund is managed, including the Statement of Investment Principles (pages 32-40) which sets out these management arrangements.

Yours sincerely

Nick Buckland
Investment Manager

This is my letter to Dorset County Pension Fund 11 Jan 2008:-

Nick Buckland
Investment Manager
Corporate Resources Directorate
County Hall, Colliton Park
Dorchester
Dorset DT1 1XJ

Dear Mr Buckland

Dorset County Pension Fund

I am writing on behalf of the Bridport Peace & Justice Group.

Thank you for your letter in response to our concerns about Dorset County Pension Fund investing in arms companies such as in Halliburton. Thank you too, for the Pension Fund Annual Report.

In reply to the points made in your letter, here are our responses.

1. Regarding your statement that ethical political or sustainability issues must, by law, be put aside in the management of the funds:

We are not pressing for Dorset County Pension Fund to disinvest from any shares on wider ethical, political or sustainability grounds. We are simply pressing them to disinvest from arms manufacturers.

Moreover you say that it is a matter of law that ethical, sustainability or political issues must be set aside when deciding council investment policy. However, I note that Dumfries & Galloway, the London Boroughs of Harrow, Richmond upon Thames, and Enfield have managed to steer clear of such investments. Are you suggesting that they are breaking the law?

2. Regarding your point that there are practical difficulties, in that large companies may have some ‘unacceptable’ parts, while some make generic parts (eg, nuts and bolts) which could be utilised for unknown purposes:

We are not pressing for the Dorset County Pension Fund to disinvest from large diversified businesses, nor from companies that make generic parts that might go on to be used by others for unknown purposes.

We are simply asking that the council disinvest from companies that would commonly be regarded as arms companies. They are easily identified – for a list see http://www.caat.org.uk/campaigns/clean-investment/2007/la-south-west.php.

3. In response to your point that ‘there is a strong argument that it is more effective to hold shares in such companies and use voting power to influence outcomes’:

Has Dorset County Pension Fund ever used its voting power to influence an arms company? My understanding is that General Dynamics are in the business of, amongst other things, making weapons of mass destruction. Could Dorset County Pension Fund influence it to diversify into making plough shares by voting power?

4. You contend that ‘Selling or not holding stocks has been shown to have little or no effect. For every seller there is a willing buyer’:

The more sellers there are of shares relative to buyers, the lower the price of the shares tends to go. The lower the share price, the more difficult it is for these arms companies to raise money.

5. As regards your statement that ‘Our work on this topic in the past has shown that it would be very difficult to fairly operate ‘ethical policies’ that all (and not just some) of our stakeholders would sign up to,’ we would respond:

When did you work on this topic in the past? Was the work specifically relating to arms companies, American Arms Companies, manufacturers of weapons of mass destruction, or were the terms more vague, such as the term ‘ethical’.

When did you last ask the stakeholders what they would sign up to?

You may recall that we were told that Iraq was to be invaded, on the strength of what turned out to be unfounded allegations that they were developing weapons of mass destruction?

The fact that the lives of hundreds of thousands of civilians have been sacrificed over this false claim may have altered the willingness of stakeholders to invest in arms companies: arms companies that make weapons of mass destruction.

We are resolved to influence our elected representatives.

Please will you confirm that the members of the Pension Fund Investment Committee at the moment, who are representatives from Dorset County Pension Fund, are elected by the full council? Please can you let me have details of the current representatives on Please can you let me know when and where is the next meeting of this committee?

We are suggesting that the Dorset County Pension Fund disinvests from a total of 13 companies, out of more than one thousand. Is this really so significant that it will have any real bearing upon the returns that you receive?

Yours Sincerely

David Partridge

A reply from Dorset County Pension Fund 29 Jan 2008:-

Dear Mr Partridge

Dorset County Pension Fund

Thank you for your further letter of 11th January in response to mine of 10th December.

Of course I do understand the arguments you make, and as individuals those involved in the administration of the Fund will have varied views on the appropriateness of defence industry investments, as well as investments in breweries, tobacco, gambling etc. The key point that I am making is that in the broadest of terms maximising returns has to be my key objective. Eliminating any part of the economy from the investment portfolio because of personal views on what is right or wrong does not meet my fiduciary duty. Maximising investment returns does, I believe, accord with the Council's mission statement for the people of Dorset.

In response to your specific question on the membership of the Pension Fund Investment Committee; the Committee consists of elected members, four County Councillors, two councillors representing Bournemouth and Poole Councils, and one District Council representative. The Committee also includes a non-voting union representative. The Committee meets 4 times a year, and the date of the next meeting is 19 February. The current Committee membership is shown below:-

Pension Fund Investment Committee

Dorset County Council - Captain John Lofts (Chair), Colonel Geoff Brierley, Susan Jefferies, John Wilson
Bournemouth Borough Council - John Beesley
Poole Borough Council - Neil Sorton
District Councils - Tony Frost
Union Representative - John Wicks

Yours sincerely

Nick Buckland
Investment Manager