57% of UK pensions have set net-zero targets

A Pensions and Lifetime Savings Association survey shows the ESG priorities and TCFD reporting progress of UK pensions.

A survey by the UK’s Pensions and Lifetime Savings Association shows 57 percent of its pension fund members have set net-zero targets and a further 18 percent plan to do so in the next two years across their entire portfolios – including public and private markets investments.

PLSA represents pension schemes with £1.3 trillion ($1.6 trillion; €1.5 trillion) in investable capital and 30 million policyholders, according to a statement from PLSA. Between April and May, 91 pension scheme member organisations responded to the survey.

On their priorities for stewardship in 2022, 68 percent listed climate transition plans as a priority, 56 percent listed net-zero targets, 37 percent listed board diversity and 35 percent listed human rights.

The survey also found 63 percent of pension schemes have started working on their Taskforce on Climate-related Financial Disclosures report, of which 28 percent have already published a TCFD report. Fifty-five percent plan to publish a TCFD report this year. In regulations introduced by the UK’s Department of Work and Pensions last year, pension schemes managing assets worth more than £5 billion are required to publish TCFD reports alongside their financial reports within seven months of their first financial year-end after 1 October 2021. The regulation also applies to pension schemes managing assets worth more than £1 billion from 1 October 2022.

PLSA conducted the survey to mark its annual investment conference, held this week in Edinburgh. “Climate risk is an important focus of the conference, which will feature dedicated plenary sessions, including with leading pensions chief investment officers and responsible investment experts, on how pensions schemes will invest for the green transition,” a statement from PLSA said.