Here is a summary of the scheduled discussions for the Royal Borough of Kensington and Chelsea Investment Committee meeting on 3 November 2025.

The meeting included a review of investment performance, updates on the pension bill and direct property investments, and a discussion on the fund's business plan. Councillors were also scheduled to consider the implications of asset pooling and responsible investment.

Quarterly Performance Review The Investment Committee was scheduled to receive the Northern Trust quarterly performance review for the period ending 30 June 2025. According to the report pack, at that time the fund was valued at £1,893 million, a 3.9% increase from the £1,822 million valuation as of 31 March 2025.

The report pack noted that during the quarter, one property was purchased, and to finance this acquisition while maintaining sufficient liquidity, £20 million was scheduled to be withdrawn from Baillie Gifford and £15 million from BlackRock global equities.

The report pack included commentary from Northern Trust stating that Baillie Gifford exceeded its quarterly benchmark by 4.04%, but underperformed over three and five years. It also noted that BlackRock's MSCI Global Equities Portfolio performed in line with the index for the quarter, with a three-year return below target. Adams Street underperformed its quarterly benchmark by 8.4%, but since inception, it outperformed its comparable benchmarks. The pooled property manager, CBRE Global Investors, outperformed by 4.4% against the quarterly benchmark, and the fund was in the process of winding down.

The report pack also included a PIRC performance report, stating that the Royal Borough of Kensington and Chelsea Pension Fund continued to be the top performer over all longer-term periods, but in the latest 12 months, the fund achieved a return of 2.2%, ranking in the 83rd percentile.

Pension Bill Update The Investment Committee was scheduled to receive an update on the Pension Schemes Bill 2025 and its implications for the fund. The report pack noted that the bill reinforces the government's intention to mandate that all Local Government Pension Scheme investments be transferred to London Collective Investment Vehicle pool management by 31 March 2026.

The report pack included a draft Responsible Investment Matrix from the London CIV, and recommended that the Committee consider appointing a member to act as a representative to ensure effective representation and ongoing dialogue with the London CIV.

The report pack included a Mercer report, Appendix 2 Mercer - Transfer of assets, which stated that the London CIV is expected to be responsible for how the investment strategy is implemented after March 2026.

Active Global Equity Review The Investment Committee was scheduled to review the allocation to the Baillie Gifford Global Alpha Growth Fund, following a review in November 2024. The report pack noted that while the mandate has outperformed its benchmark since inception in 2005, it has lagged the target over recent time periods. It also noted recent staffing changes at Baillie Gifford, and the impending impact of asset pooling via the London CIV.

The report pack recommended that the Investment Committee review the Baillie Gifford Global Alpha Growth Fund allocation in light of recent performance, manager changes, and pooling impacts, and consider retaining the mandate, ongoing monitoring, or transitioning the assets to the passive equity mandate.

Direct Property Update The Investment Committee was scheduled to receive an update on the direct property mandate. The report pack included a CBRE quarterly update and performance report, and noted that the direct property portfolio accounts for 17% of the fund against a 20% target allocation. It also noted that the fund has completed recent acquisitions, including a mixed-use property and a land acquisition, and that several asset management initiatives have been completed during the quarter, resulting in increased passing rent across multiple properties.

2024/25 Business Plan Outturn Report The Investment Committee was scheduled to review the outturn report for the 2024/25 Royal Borough of Kensington and Chelsea Pension Fund Business Plan. The report pack stated that the 2024/25 business plan objectives were successfully met, with significant progress in administration, investment, and risk management, supported by high key performance indicator compliance and financial stability.

Benchmarking The Investment Committee was scheduled to discuss a proposed methodology for establishing a pre-pooling cost baseline for the Royal Borough of Kensington and Chelsea Pension Fund's assets, to enable consistent tracking pre- and post-transition to the London Collective Investment Vehicle by 31 March 2026.

Update on 2025 Actuarial Valuation Process The Investment Committee was scheduled to receive an update on the progress of the 2025 actuarial valuation process conducted by Hymans Robertson, offering insights into the emerging funding positions and key factors driving changes across LGPS funds since the 2022 valuation. The report pack stated that initial results for the Royal Borough of Kensington and Chelsea Pension Fund indicate a funding level of 174%, compared with 154% at 31 March 2022, with assets of £1,829 million against liabilities of £1,049 million.

Final Pension Fund Annual Report and Financial Statements and External Audit Report 2024/25 The Investment Committee was scheduled to review the Pension Fund Annual Report and Financial Statements for the year ending 31 March 2025 and the external Audit Findings Report 2024/25.

Rebalancing The Investment Committee was scheduled to review the most recent investment asset valuations, noting the portfolio and asset classes reference the target allocation ranges. The report pack noted that all investment asset allocations are currently within their respective review ranges, and no immediate rebalancing is required.

Update on Direct Investment in Temporary Accommodation The agenda included an item to discuss an update on direct investment in temporary accommodation, but the supporting documents were marked as restricted and are not available to the public.