The Universities Superannuation Scheme said it had cut its equity investments in Russia by half in the last few weeks. The retirement plan said it will seek to offload the remaining 0.5% share of its approximately £90 billion ($120 billion) portfolio that is linked to Russian assets.
"In terms of our own position, there is clearly a financial as well as a moral case for divestment with respect to our Russian holdings," a USS spokesperson said.
Pension plans linked to Transport for London and telecoms company BT have made similar statements this week, as have providers including Legal & General and Abrdn — formerly Standard Life Aberdeen.
"In the light of these circumstances we have placed a moratorium on new long positions taken in all Russian assets which is over and above full compliance with UK government sanctions restricting trading in sovereign debt and other Russian assets," the USS spokesperson added.
The spokesperson continued that where the fund did not have direct control — in pooled funds, for example — it would push its asset managers to respect the moratorium.
In other moves, the £57 billion BT Pension Scheme has been working with its investment manager since the start of the year to reduce exposure to Russian assets. It said it had offloaded £162 million of assets between December and the end of February.
"The scheme's exposure to Russian securities has been relatively small due to governance concerns and ownership rights associated with the region," a spokesperson for the BT plan said.
The scheme currently has 0.05% of its portfolio in Russian securities, equivalent to £30 million. That is a drop from its previous allocation of 0.3% of its portfolio, or £192 million, at the end of December 2021.
"We will look to reduce our exposures further if market conditions allow," the spokesperson added.
But further sales could be complicated by the effect on the Russian economy of global sanctions. Measures have included freezing the assets of Russian banks, restricting access of the Russian central to investment held abroad and cutting Russian banks off from the SWIFT global financial transactions messaging network.
Switzerland's Federal Pension Fund, PUBLICA, said this week it will not buy any more Russian securities and divest its existing holdings. The fund said that European Union financial sanctions on Russia and the closure of the Moscow Stock Exchange this week could delay the unloading of Russian assets.
"The investment committee nevertheless seeks to divest its Russian holdings as soon as market liquidity permits," the Swiss fund said.
Ratings agencies Moody's and Fitch cut the ratings on Russian government bonds to junk status on Wednesday. And MSCI Inc., the global index provider, said the same day that Russian stocks have become "uninvestable" and will be dropping from its closely-watched Emerging Markets index.
"MSCI received feedback from a large number of global market participants, including asset owners, asset managers, broker dealers, and exchanges — with an overwhelming majority confirming that the Russian equity market is currently uninvestable and that Russian securities should be removed from the MSCI Emerging Markets Indexes," the company said.
--Editing by Ed Harris.
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