Pension Fund Chair Net Zero Statement of Support
Pension schemes are highly exposed to the risks of an unsustainable future, but also powerfully positioned to influence sustainable outcomes. The signatories of our Statement of Support have made a collective commitment to play their part in the transition towards a net zero emissions world.
19 pension fund chairs (or equivalent), representing £422.3 billion in assets under management, have set (or committed to set within 12 months of signing) net zero targets.
Why is this statement important?
As holders of long term assets and underlying owners of major corporations, asset owners have the opportunity to catalyse a shift within the pensions industry and in turn, the wider system.
Chairs of pensions schemes represent the ‘start of the chain’ for investment decisions. They are responsible for setting the direction of their scheme’s investment strategy and instructing their service providers to follow this mandate. Using their collective voice encourages peers to consider the steps to a net zero-aligned pension scheme.
Rather than a demand for others to take action, this statement of support is a commitment by those who are signing it to take action; and an ask out to their peers to follow suit. To support this, A4S has worked with members of its Asset Owners Network to develop guidance for trustees on the steps towards setting net zero investment strategies.
This decade is critical. The Intergovernmental Panel on Climate Change (IPCC) has warned of severe consequences of a failure to prevent global warming exceeding 1.5°C. To limit the increase in global average temperatures to 1.5°C above pre-industrial levels, global emissions need to halve by 2030, and drop to net zero by the middle of the century, becoming net negative thereafter. The IPCC has also made it clear that, even if we limit the rise to 1.5°C, significant physical impacts from climate change are already inevitable, many of which will exacerbate catastrophic declines in natural capital and biodiversity, as well as impacting people’s lives and livelihoods.
As chairs of pension and other retirement schemes, we recognize the scale of the transition needed and the challenges climate presents for governments, business and civil society. In our positions, we recognize that our ability to uphold our fiduciary duty in providing long-term, risk-adjusted returns to our members is threatened by the impact of climate change both now and in the future. Our responsibilities include driving capital towards positive outcomes, being a catalyst for innovation and opportunity, helping to finance the transition to a net zero global economy, investing in resilience to protect against physical risks and restore nature, and leveraging our influence across the investment chain.
Several pension and retirement schemes have already made ambitious greenhouse gas emissions reduction commitments. These include commitments to achieve net zero emissions across the scheme’s portfolio by a certain year or reductions in line with the Science Based Targets initiative. As a group of pension and retirement scheme chairs, we commit to build on this, and to work collectively to share our experiences and practices with others. We intend to demonstrate this by doing the following within the 12 months of signing this Statement of Support:
- Committing to set net zero targets to align our investment portfolios with a 1.5°C pathway
- Ensuring our direct service providers to support this ambition
- Being an active shareholder across all relevant asset classes we invest in
- Collaborating with our peers to innovate ways to bring influence to bear in the interest of our members
- Attempting to understand climate risk in a holistic manner and to manage these risk factors within our investment portfolios, including physical and transition risks
Through our individual and collective actions, we aim to provide useful examples to other pension and retirement schemes grappling with similar issues.
We are proud to support a smooth transition to a net zero emissions economy and to invest in resilience. We urge other pension and retirement scheme chairs to join us. In signing this statement, we are formalizing our increased ambition and signaling our commitment to a net zero emissions, resilient future.
- Magnus Billing, Chief Executive Officer, Alecta Pensionförsäkring
- Otto Thoresen, Chair, British Telecom (BT) Pension Scheme
- Russell Picot, Chair, HSBC Bank Pension Trust (UK) Limited
- Peter Goshawk, Chair, Barclays UK Retirement Fund
- Denise Le Gal, Chair, Brunel Pension Partnership, LGPS pool
- The Honourable Nicola Roxon, Chair, Health Employees Superannuation Trust Australia (HESTA)
- Mike Craston, Chair, London LGPS CIV Limited, LGPS Pool
- Ruston Smith, Chairman, Tesco PLC Pension Scheme
- Catherine Claydon, Chair of Trustees, BBC Pension Trust
- Chris Hitchen, Chair of the Investment Committee, National Employment Savings Trust (Nest)
- John Timbrell, Trustee & Chairman of Investment Committee, Transport for London (TfL) Pension Fund
- Councilor John Mounsey, Chair, South Yorkshire Pensions Authority, South Yorkshire Pension Fund
- Tony Ashford, Chair, Unilever UK Pension Fund
- Robert Gould, Chair, Pensions Committee, Environment Agency Pension Fund
- Clive Mather, Chairman, Church of England Pensions Board
- Rory Murphy, Chair of MNOPF Board of Trustees, Merchant Navy Officers Pension Fund
- Chris Martin, Executive Chairman of ITS (acting as Professional Corporate Sole Trustee), Atos UK 2019 Pensions Scheme
- Ken Woodier, Chairman, Pennon Group Pension Scheme
- Andrew Warwick-Thompson, Chair of the Board of Trustees, Scottish Widows Master Trust
How you can get involved
- As a chair of a pension scheme click here to register your interest in signing the statement of support >
- As an organization read through our Top Tips for Sponsors of Pension Schemes on sustainable investing in pensions, and share our ESG Toolkit for Pension Chairs and Trustees with your pension board or provider.