Details of questions should be notified to the Democratic Services Manager via the committee.services@exeter.gov.uk email by 10.00am at least three working days prior to the meeting. For this meeting any questions must be submitted by 10.00am on Monday 24 June 2024.
For details about how to speak at Committee, please click the following link - https://exeter.gov.uk/council-and-democracy/councillors-and-meetings/public-speaking-at-meetings/overview/
Minutes:
The Chair reported the receipt of two questions from members of the public under Standing Order No. 19:-
Question from Ms Marilyn Spurr
“Given that Exeter City Council has declared a climate emergency I would expect that this would be to the forefront of any policy. What consideration has been given in the Treasury Management Strategy to the impacts of climate change, specifically in relation to the Carbon Footprint (environmental) implications?”
The Chair asked Councillor Vizard, Portfolio Holder for Climate, Ecological Change and Communities, to answer Ms Spurr’s question. Cllr Vizard gave the following response:
“Exeter City Council’s Treasury Management Strategy is compliant with Secretary of State Investment Guidance which emphasises the security and liquidity of any investment, followed by yield. There is currently no requirement to produce a policy that addresses climate emergency, Environmental, Social & Governance (ESG), or ethical investment issues. Authorities can implement such a policy but are not permitted to prioritise these considerations above security, liquidity or yield.
Whilst the Council does not specifically refer to ESG considerations in its Treasury Management Strategy, managing the ESG risk is part of current treasury management practices, as the Council uses mainstream rating agencies to assess counterparty creditworthiness – they now more formally incorporate ESG risk alongside more traditional financial risk metrics when assessing counterparty ratings.
The Council has previously used the Standard Chartered Sustainable Deposit where the rate is the same as the standard fixed term deposit so there has been no impact on security, liquidity or yield. Our Treasury Management advisers state that “The deposit guarantees that investment is referenced against sustainable assets, both existing and future. The investments are referenced against the United Nations Sustainable Development Goals; thus funds are put to work addressing some of the world’s biggest long-term threats including, but not limited to, climate change, health, financial inclusion and education.”
In a supplementary question, Ms Spurr asked the Portfolio Holder why an emergency could not be prioritised. Cllr Vizard offered to reply to Ms Spurr in writing.
Question from Mr Chris Hill
“The Council's corporate plan says that it aims to reach Net Zero by 2030 as part of its Climate Emergency strategy. What assessments have you made of the banks used by the council and those banks' investments and how they align with the goal of Net Zero?”
The Chair asked Councillor Vizard, Portfolio Holder for Climate, Ecological Change and Communities, to answer Mr Hill’s question. Cllr Vizard gave the following response:
“The Council seeks external treasury management advice from the Link Group. Link provide regular counterparty lists and suggested investment durations and notify us of any creditworthiness changes. These counterparty lists are based on credit ratings from the three rating agencies (Fitch, Moodys and Standard & Poors), and the rating agencies take Environmental, Social & Governance (ESG) risk into account when they make their assessments.”
In a supplementary question, Mr Hill asked the Portfolio Holder if he agreed that the carbon footprint caused by investing in the exploitation of fossil fuel needed to be taken into consideration when choosing a bank. Cllr Vizard offered to write to Mr Hill in writing.