Reduction of investment holdings in oil and gas (FOI)

Request

Further to previous Freedom of Information response published at the following link:

States investments in the fossil fuel and coal sectors (FOI)

Can you please confirm what happened to all the oil and gas investments between December 2017 and December 2018? Have the investments been disposed of or have they been transferred to another Jersey Government fund?

Response

During the course of 2018 the States divested from their Passive Global Equity Pool and Active UK Equity Pool, transferring Funds into the Active Global Equity Pool. The managers of the Active Global Equity Pool have constructed portfolios with a lower concentration in the Energy Sector.

The Passive Global Equity Pool passively replicated the MSCI All Country World Index (“ACWI”), and was the source of many of the smaller (but more numerous) holdings to oil / gas.

The Active UK Equity Pool followed an active investment approach, limited to investing in UK companies, with the managers selecting a more concentrated portfolio aimed at outperforming the benchmark. The UK Market has a far higher concentration in oil / gas than the world economy, with 14% of the FTSE all-share in oil / gas vs 6% of the MSCI ACWI in energy. Based on the available stocks, the active UK manager had constructed a portfolio with a higher allocation to oil / gas.