Islington Council has decided to divest their pension fund holdings tied to Russian companies either by selling or writing them off following the invasion of Ukraine by Russia and growing concerns around the amount of Russian money in London’s financial system.
Councillor Paul Convery (Labour), chair of the Pension Subcommittee said: “Russia’s brutal military attack on Ukraine has horrified the world and it is right that the appropriate action is taken.”
A statement from the Pensions Subcommittee on 4 March said: “On 28 February, Islington undertook a diligence exercise to identify any Pension Fund investments tied to Russian businesses. This has shown we have shareholdings in a number of Russian listed companies held indirectly through a pooled emerging markets fund managed by LGIM/BMO (Legal & General).”
The council will decide on 14 March whether to attempt a sale or write off the assets.
Cllr Convery said “As of 28 Feb, these holdings were valued at £1.14m but they are now ‘stranded assets’ with no evident value. They cannot be sold because the Russian equity markets are closed and any investments denominated in Russian roubles will be almost worthless as the Russian currency has collapsed… Inevitably a write-off will have an impact on the Fund value, but these holdings represented a very small element in the Fund’s whole portfolio, which is currently worth £1.66 billion, therefore slightly less than 0.1% of the Fund.”
The move sparked a row on Twitter between the local Labour and Liberal Democrat Parties, with Labour accusing Lib Dems of attempting to steal credit for the initiative.
Lib Dem Councillor Kate Pothalingam reportedly called for the council to divest the pension funds of Russian assets in an open letter. Additionally, a day before the move was announced, Islington Lib Dems asked for signatures on a petition to force the divestment in a now deleted tweet.
Cllr Convery hit back angrily saying: “I apologise if this sounds a little partisan, but Lib Dems always do this: hear the Council is about to do something, demand that something gets done, then claim they did it. In lesser times we called this the Lib Dem ‘cracked slab’ tactic.”
The Lib Dems tweeted: “Glad to see we are on the same page on this cross-party issue.”
