UK Pension Providers Climate Action

Pension schemes in the United Kingdom (UK) have a crucial role to play in combatting the climate crisis, whilst ensuring long term sustainable returns for beneficiaries. Profundo conducted a policy assessment of the twenty largest defined contribution (DC) workplace pension providers in the UK for Make My Money Matter (MMMM). The assessment framework consisted of seven themes that are important for addressing climate change: commitment to a 1.5 °C pathway; measurement and disclosure of the carbon footprint; detailed target setting per sector and asset class; investments in climate solutions; phase-out of fossil fuels; deforestation and land use; stewardship instruments used to align the portfolio and drive change. The results of this study indicate that most of the largest UK DC pension providers have inadequate or poor policies to address climate change issues. Based on these findings, this report indicates priority areas for UK DC pension providers to focus on in 2024 and beyond.