LGPS Central stays on top of things amid coronavirus challenges

Updated with clarification

A robust business continuity plan and clear communication with third-parties have kept LGPS Central Ltd. on top of its day-to-day workload.

The pool as a whole has about £45 billion ($55.2 billion) in assets across eight U.K. local government pension schemes. The firm, which currently manages about £20 billion in assets, is still ticking tasks off its agenda, even in the coronavirus-induced lockdown.

"We're really pleased that, despite these unprecedented levels of volatility, we were still able to launch our £1.2 billion global investment-grade corporate bond fund last month," said Mike Weston, CEO at Wolverhampton, England-based LGPS Central. "It was a real collaborative effort, and the transition team in particular worked together extremely effectively during this period."

Initial investors in the strategy, for which the pool hired Neuberger Berman and Fidelity International to run equal shares of the allocation, are the Derbyshire Pension Fund, Matlock; Nottinghamshire Pension Fund, West Bridgford; Staffordshire Pension Fund, Stafford; and Worcestershire Pension Fund, Worcester.

The pensions pool is made up of four other partner funds — the pension funds of Cheshire, Leicestershire, Shropshire and West Midlands councils. LGPS Central covers more than 2,000 member employers and about 1 million participants.

"We will continue to work with our partner funds to launch new (strategies) and will soon make an announcement on the external fund managers we've selected to manage our upcoming emerging market debt fund," Mr. Weston said. Executives launched a search in December for active, global emerging market bond managers to run its £900 million strategy.

As for potential future investments and changes to the portfolio, "we continue to closely monitor the markets, as well as the performance of the pooled funds we manage. We're also working very closely with our selected external fund managers to make sure they're doing all they can to deal with the huge amounts of market volatility we've seen in recent weeks," Mr. Weston added.

Even recruitment has continued during the U.K. lockdown imposed by Prime Minister Boris Johnson on March 23. Executives are using videoconference interviews in the search for a head of private markets — a process it launched last year.

For the pension pool's staff, "videoconferencing is now the norm as we maintain and enhance our internal communications, while instant messaging, enterprise social networks and regular staff briefings ensure all employees are kept up-to-date with everything they need to know," Mr. Weston said. Executives are also in regular contact with the member pension funds, "with daily calls designed to explain how we're looking after their investments and answer any questions they may have."

Fortuitously, the pool's business continuity plan had been fully tested only a few months before the U.K. lockdown was imposed in March. "This meant all staff were ready to work from home, and we knew our equipment worked remotely," Mr. Weston said.

As the lockdown continues amid efforts to contain the coronavirus outbreak, LGPS Central executives have in place a "rolling business plan so we're on top of the key meetings and deliverables in the diary over the coming weeks and months. This helps us plan how to manage our business in the unfortunate event a number of staff are absent at the same time," Mr. Weston said. "All of our planned meetings, whether at executive, committee or board level, continue to take place via videoconferencing, and decisions are still being made."

The pool's operations team is also working with external parties to avoid any disruption caused by third parties' business continuity arrangements.

"Whilst we look forward to returning to the office, I'm confident we'll continue to operate well together with robust communication and collaboration," Mr. Weston said. "It's important to be resilient no matter how circumstances change, and we will continue to serve our clients to the best of our ability no matter what the future holds."