THE Church of England Pensions Board has declined an invite from the comedian Joe Lycett to disinvest from water corporations which are spilling sewage.
The TV programme Joe Lycett vs Sewage, broadcast on Channel 4 on Tuesday, shows the comedian writing to the Archbishop of Canterbury, and alluring the Pensions Board to affix him in disinvesting from Severn Trent Water.
“I do know you legends wish to make ethical investments, and previously cut your financial links with oil and gas corporations like Shell over climate concerns [News, 23 June 2023]. I’m now asking you to affix me and make an analogous gesture in regard to the water corporations.”
The company was fined £2 million on Monday for discharging about 240 million litres of raw sewage between November 2019 and February 2020 from the Strongford Sewage Treatment Works, Stoke-on-Trent, in Staffordshire, into the River Trent.
Failing infrastructure and under-investment have been blamed for continued sewage spills and the pollution of rivers, lakes, and canals throughout England.
The day after the programme was shown, the Pensions Board published a response to Mr Lycett, dated 21 December, from the Board’s chief responsible-investment officer, Adam Matthews.
Mr Matthews wrote that the combined shareholdings of the Board in two water corporations named by Mr Lycett were “lower than half one million kilos”. He also confirmed that “the Board does also own debt in a lot of corporations inside the sector.”
A spokesperson for the Pensions Board confirmed to the Church Times on Wednesday that it holds £30 million in fixed-income bonds (Anglian Water, Northumbrian Water, South West Water Finance, Thames Water, United Utilities, Welsh Water, Yorkshire Water) and £3250,000 in shares with Severn Trent Water and United Utilities. The investments are all expected to yield a dividend.
In his letter, nonetheless, Mr Matthews wrote that the Board was committed to encouraging “change in and by the sector, which a one-off disinvestment within the short term would limit. We use disinvestment as a final resort once we assess that our influence as an investor just isn’t achieving the specified results, but we have now not yet reached that time with the water corporations.”
The letter continued: “Where our evaluation indicates that we have now a useful role to play, our preference is to stay invested as a method of applying influence. However, as recently demonstrated by the instance you mention of the Pensions Board’s divestment from the oil and gas sector, the Pensions Board doesn’t rule out disinvesting from corporations or refusing to fund future debt if we imagine the management should not suitably conscious of our engagement. That type of escalation is also an option for water utility corporations, nevertheless it just isn’t one which we’re recommending to our Trustees as being mandatory at this stage.”
Mr Matthews went on to jot down that the Board remained “deeply concerned by the operation of several [water] corporations, the effectiveness of the regulation of the sector and likewise how investors can higher engage with the sector to enhance it. Given the extent of concern and the problems that you just rightly raise, this just isn’t a simple task but we view that progress and enhancements are possible.
“To this end, the Pensions Board are engaging a lot of corporations regarding their plans to deal with historic underinvestment in key infrastructure, the burden of future finance on their customers, the resilience of the sector to extreme climate impacts and, ultimately, how individual company Boards retain or seek to regain the arrogance of their customers and the social licence of wider society.”
Last yr, the Pensions Board published its first Climate Action Plan (News, 8 December 2023), which confirmed its decision to disinvest from corporations within the oil and gas sector, and fossil fuels specifically, due to environmental concerns.
