Avon Pension Fund continues to stick to its guns to invest in defence

The Avon Fund Pension committee has today voted to maintain its current approach to investing in aerospace and defence.

Committee members voted 8 to 2 in favour of confirming its ‘in principle’ decision, taken in March 2025, to remain invested in the aerospace and defence sector.

In addition, it noted the views expressed by fund members and agreed to communicate them to its new investment pool, Local Pension Partnership Investments (LPPI), to inform their investment policies. Avon will officially join LPPI in April.

Since December 2024, the Avon Pension Fund committee has received politically motivated petitions requesting the fund divest from companies supplying Israel, influenced by a particular political interpretation of the Israel-Gaza conflict.

The committee considered these petitions at its meeting in March 2025, when it decided that, rather than focus specifically on Israel, it could address the issue by deciding whether the fund should continue investing in the aerospace and defence sector.

The committee took the ‘in principle’ decision in March 2025 to remain invested, subject to seeking an assessment of member views through a survey alongside further consideration of the legal position.

Three developments informed the pension committee’s final decision on aerospace and defence investments.

One, the fund undertook a representative survey of its members’ views, led by an independent research provider which showed support for its defence investments.

The survey showed 42% sup­por­ted divest­ing from aerospace and defence investments, while 47% favoured remaining invested in aerospace and defence, and 11% were unsure.

Two, the fund has received expert legal opinion on the issue, and three, the UK government has published its Fit for the Future proposals, which shift key investment decisions from LGPS funds to their investment pools.

At the meeting, the committee heard that any decision to exclude investment in aerospace and defence around non-financial factors would need to meet two conditions: one, doing so would not involve significant risk of financial detriment to the fund – with the view ultimately that it would – and two, there is good reason to think that scheme members would support the decision.

The member support condition requires a “high proportion of those members with a view” to support the proposal.

“Committee members recognised that this is a difficult and sensitive issue, which is why the committee sought member views through a survey, sought further legal advice, and has taken its time to reach a decision,” said councillor Toby Simon, chair of the Avon Pension Fund Committee. 

“The committee has met and decided its approach, which is to remain invested in the aerospace and defence sector,” Simon added. “We recognise that some stakeholders will be disappointed with this decision, but the committee believes it is the right decision given the further work undertaken.”