UK's Largest DC Pension Providers Lag on Climate Action
A new report has revealed a worrying lack of climate action among the UK's largest defined contribution (DC) pension providers. Only three out of 20 major providers have been rated as having adequate climate plans.
The report, released by a coalition of climate campaigners, criticises the inaction of many leading DC providers. Mercer, Hargreaves Lansdown, SEI, and The People's Pension were among those flagged for inadequate climate action. Despite some progress in stewardship efforts, many providers still have significant exposure to fossil fuels.
Surprisingly, only four DC providers currently have restrictions on fossil fuel investments in place. While around half of all UK DC providers have at least adequate investments in climate solutions, this is not enough to combat the climate crisis. The scorecard measured providers on commitment to limiting global temperatures, measurement and disclosure, target setting, investments in climate solutions, fossil fuel exposure, deforestation exposure, and stewardship efforts.
Thirteen of the UK's largest DC providers have been classed as having inadequate climate plans. Climate campaigners urge these providers to step up their efforts and align their investments with the Paris Agreement goals. The three providers recognised for their adequate climate plans - Nest, Aviva, and Legal & General - serve as examples for others to follow.
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