INVESTMENT PHILOSOPHY

Investment philosophy and strategy is a key component in the effective management of any pension arrangement. The Trustee has strongly held investment beliefs which influence the way Cheviot’s investment strategy is delivered.

Cheviot's approach

Cheviot and VLK have designed a comprehensive investment approach. Whilst the underlying strategy may be complex, we provide simple and accessible information to members and their employers that helps them make their choices.

The investment philosophy is based on a number of core investment beliefs that have been agreed with VLK:

A strong governance process is required to enable performance to be reviewed regularly, and advice can be robustly challenged. Decisions requiring Investment Committee agreement need to be made and implemented quickly and effectively. An essential part of the governance is also to regularly review advisers.

The level of risk in each fund in the investment portfolio should be commensurate with the target return. Defined contribution assets need to keep pace with inflation.

The details of the portfolio design are more effectively managed by an FM manager.

The benefits of illiquid assets is directly linked to the relevant timeframe.

Considering materially financial factors are consistent with the Trustee’s fiduciary responsibilities to investors (both members and employers). Sustainability, including climate change will be a financially material factor now and increasingly so in the future. Progress towards the net zero commitment including establishing the baseline position of the portfolio and interim targets.

Long term investors have an opportunity to influence managers and companies in relation to climate change issues and stewardship.

Where practical, assets will be invested in funds which focus on ESG and climate change issues. Members are also able to self-select a Shariah Fund, and ESG fund and an Ethical fund.

The use of white labelled funds on Mobius Life’s investment platform supports these beliefs and allows changes to be made to the strategy within 24 hours. The way these beliefs are implemented for each section or scheme can be different.