Seven Local Government Pension Scheme (LGPS) pools have lent their support to a report outlining how to mobilise local investing across the country.
The report, published by impact advisory firm The Good Economy, was commissioned in response to the government’s drive for pension schemes to invest more in the UK. It explores how the sector can allocate to ‘place-based’ investing to support locally defined priorities while balancing fiduciary duty.
The report argues that the UK needs a stronger domestic economy rooted in inclusive, long-term growth. Recommendations include collaborating on local investing strategies and establishing a common impact reporting standard.
Zoe Alexander, director of policy and advocacy at Pensions UK, which also sponsored the report, said: “Building investment further – and at a local level – can help generate the additional capital needed for businesses to grow, build vital infrastructure for communities, and develop new technologies that benefit all of society. It also supports the government’s drive to deliver more UK growth.”
The guidance has been developed collaboratively, with the support of seven LGPS pools representing nearly all administering authorities in England and Wales, in a bid to recognise the need for a framework to guide the development of local investment strategies.
“This journey is only just beginning – LGPS local investing can set new norms for responsible private market investment, delivering robust member returns and long-term value for UK communities.”
Sam Monger, The Good Economy
Its sponsors include Border to Coast, Brunel Pension Partnership, LGPS Central, Local Pensions Partnership Investments, London CIV, Northern LGPS and Wales Pension Partnership.
The white paper sets out a strategic framework and practical guidance for local investing, including how LGPS capital can be channelled to support local growth plans while capturing the scale and efficiency of pooling – all within a disciplined fiduciary framework.
Private market fund managers are seen as a critical enabler of local investment. The paper provides case studies showcasing how experienced fund managers are already executing local investment strategies and delivering robust financial returns alongside place-based outcomes.
Sam Monger, head of place-based impact investing at The Good Economy, said: “Despite its global financial strength, the UK suffers from decades of underinvestment. Public funding alone cannot meet growth ambitions, so unlocking institutional capital is essential.
“The LGPS has a distinct role to play in mobilising local investing across the country – pools and administering authorities must work together to set and monitor targets, embedding impact alongside risk and return.
“This journey is only just beginning – LGPS local investing can set new norms for responsible private market investment, delivering robust member returns and long-term value for UK communities.”
