Climate Change

The whole pensions sector must collaborate if it is going to drive real change on climate issues, industry experts have warned.

The BT Pension Scheme (BTPS) has become the latest pension fund to commit to a net-zero investment strategy by a fixed date in order to mitigate the financial risks from climate change.

James Baxter-Derrington talks to ESG investment specialists about current issues in the ESG ratings market and how the market might look in years to come.

Over a third of asset managers (39%) were unable to provide a single example of a climate change related engagement effort despite 76% saying they “consider climate risks and opportunities”, according Redington.

The government has put forward proposals to require the 100 largest occupational pension schemes – those with £5bn or more in assets and all authorised master trusts – to publish climate risk disclosures by the end of 2022.

Scottish Widows has invested £2bn of pension fund assets to become the inaugural investor in BlackRock’s authorised contractual scheme (ACS) Climate Transition World Equity Fund.

More than 60 civil society leaders including MPs, climate experts, faith leaders and local councillors have signed an open letter accusing pensions and financial inclusion minister Guy Opperman of backing continued investment in fossil fuels.

Nest has set out plans to move to its default pension strategy towards a net-zero investment portfolio by 2050, with at least £5.5bn of equities pledged to climate aware strategies.

Lorna Blyth looks at how an amendment to the Pension Schemes Bill could force pension schemes to align their investment strategies with the Paris climate agreement.

The Association of Consulting Actuaries (ACA) has welcomed the Pensions Climate Risk Industry Group (PCRIG) and the Department for Work and Pensions’ (DWP) guidance on climate risk.