David Fairs
The Pensions Regulator (TPR) has published further guidance to help trustees and advisers comply with new Taskforce on Climate-related Financial Disclosure (TCFD) duties.
The watchdog has today (23 February) published an illustrative example charting how the trustees of the fictitious ‘XYZ pension scheme' might approach meeting the requirements of the new climate regulations.
The example seeks to address industry requests for more information and examples following its eight-week consultation on its guidance on governance and reporting of climate-related risks and opportunities.
The latest guidance is intended to help develop understanding of how trustees and advisers might approach implementing the requirements of the new regulations at a practical level - providing information relevant to trustees and advisers of any scheme seeking to comply with the regulations.
TPR executive director of regulatory policy, analysis and advice David Fairs said: "We expect this example will prove helpful to trustees and other industry stakeholders as they get to grips with the new, climate-related regulations."
He added: "From October more schemes are set to come into the scope of these rules, so I also urge trustees and advisers of those schemes to make sure they are familiar with the relevant guidance in this area.
"Those running schemes out of scope of the rules but who want to do more to manage climate-related risks and opportunities may also find both our new example and final guidance helpful."
The climate rules initially apply to authorised schemes and those with relevant assets of £5bn or more but will also start to apply to schemes with relevant assets of £1bn or more from 1 October. The Department for Work and Pensions has said it will consider whether to roll the rules out to smaller schemes in 2023.
TPR said it also plans to contact trustees of schemes that may have moved into scope of the rules since their last valuation to ensure they are aware of their duties.
TPR published its initial guidance describing what trustees need to do and report on to be TCFD compliant last December.
The guidance provided practical examples of how trustees might seek to comply with the regulations as well as setting out the penalties they could face for breaches - including mandatory fines of at least £2,500 for not publishing a climate change report.
