People & Money

Top pension funds throw weight behind emerging market net zero transition

A group of the UK’s top pension funds have thrown their weight behind driving the net zero transition in emerging markets today, as pressure grows on pension schemes to decarbonise their investments.

The funds, which represent £400bn in assets under management and over 18m members, have been convened by the Church of England Pensions Board to draw up a plan to help fuel a net zero transition in emerging economies.

Universities’ Superannuation Scheme, BT Pension Fund and Legal & General Workplace Pension Plan are among the names to have backed the plans, which will see the schemes explore how to scale up investments in support of the climate transition in emerging economies.

Pensions minister Guy Opperman welcomed the move today.

“I look forward to working closely together to assess how we can further unleash the productive power of UK pensions in support of the climate transition in emerging economies, while also delivering sustainable returns for members,” he said.

The commitment comes amid growing scrutiny of pension investment into fossil fuel and climate projects in the UK, with pension schemes scrambling to decarbonise their portfolios and back greener investments.

Scottish Widows became the first UK pensions commit to decarbonising its investment portfolio and halving emissions by 2030, with pressure now growing on other schemes to follow suit.

Aviva came under fire from green retail investment platform Circa5000 last week, which invested to offset 100 tonnes of CO2 on behalf of Aviva.

“Big players in the industry, like Aviva, aren’t doing enough to remove these assets, or be transparent with their investors,” founder Tom McGillyCuddy said.

“The way investing has traditionally been done, particularly in pensions, is archaic. It is not how we will secure our future, both individually, and collectively for our planet.”

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