General information
Website: http://www.lpf.org.uk/
Member councils: City of Edinburgh (administering authority), East Lothian, Midlothian, West Lothian
Lothian Pension Fund is one of the largest in the UK, with 84,000 members and assets worth £7.5 billion.[1] Employers covered by the fund include the City of Edinburgh, East Lothian, Midlothian and West Lothian Councils, plus 84 other public and charitable bodies. These include Scottish Water, Edinburgh Napier University, Heriot-Watt University, Donaldson’s Trust and Edinburgh Leisure.
Lothian Buses Pension Fund was merged with Lothian Pension Fund in February 2019. Lothian Pension Fund also manages the Scottish Homes Pension Fund.
Investments
A list of assets taken from the fund’s website shows that Lothian Pension Fund and the Scottish Homes Pension Fund together held shares worth nearly £126 million (1.7% of the fund) in five companies that are involved in nuclear weapons work as at 30 September 2020:[2]
| Company | Value of shares (£) |
| BAE Systems | 15,063,811 |
| General Dynamics | 4,064,028 |
| Lockheed Martin | 102,474,021 |
| Rolls Royce | 992,558 |
| Thales | 3,138,454 |
| Total | 125,732,872 |
Visit the resources page of our website to download our Lothian Pension Fund briefing sheet which contains more information about each of these companies.
This means that Lothian Pension Fund had more money invested in nuclear weapons producers than any other Scottish local authority pension fund as at 30 September 2020.
In June 2019, City of Edinburgh Council, which administers Lothian Pension Fund, became the fourth British local authority to pass a resolution in support of the Treaty on the Prohibition of Nuclear Weapons.[3] The treaty, which entered into force on 22 January 2021, prohibits the development, production, testing and use of nuclear weapons (see section 1.2).
Lothian Pension Fund’s continued investment in nuclear weapons producers is clearly at odds with the City’s strong support for the treaty.
Policy
Representatives of Lothian Pension Fund say that the fund cannot divest from companies for non-financial reasons, as this would conflict with the fund’s fiduciary duty to its members (see section 3A.2 for a rebuttal of this argument). The pensions committee views the management of environmental, social and governance (ESG) issues as “a question of identifying and mitigating material financial risks, not a question of ethics”[4]. Fund managers aim to “encourage responsible behaviour” through company engagement (see section 3A.1 on the limitations of this approach).[5]
This policy has allowed the fund to continue investing in harmful industries, including armaments, fossil fuel and tobacco.
Action
Fund members are already challenging Lothian Pension Fund investments in nuclear weapons. Midlothian Council passed a resolution calling on the fund to divest from nuclear weapons producers in 2019.[6]
If you live in West Lothian, East Lothian or the City of Edinburgh, please contact your local councillors to urge them to support a divestment resolution: https://nukedivestmentscotland.org/local-authority-divestment-resolutions/
NOTES
[1] https://www.lpf.org.uk/downloads/file/57/annual-report-and-accounts%20f.
[2] https://www.lpf.org.uk/downloads/file/79/fund-investments.
[3] https://www.nuclearpolicy.info/news/nfla-welcomes-further-council-resolutions-supporting-treaty-prohibition-nuclear-weapons-and-divestment/.
[4] https://www.lpf.org.uk/downloads/file/129/statement-of-responsible-investment-principles.
[5] https://www.lpf.org.uk/downloads/file/62/statement-of-investment-principles.
[6] https://www.nuclearpolicy.info/news/nfla-welcomes-further-council-resolutions-supporting-treaty-prohibition-nuclear-weapons-and-divestment/.
Don't Bank on the Bomb Scotland 