Trustees and chief investment officers of pension funds for 4 million people have signed up to a Climate Charter which will force asset managers, and companies they invest in, to take immediate, meaningful action to combat climate change.

 

The Charter, created by mallowstreet, harnesses the power of the investment community to ask: “What is the impact on the climate?” for each and every investment they make. 

 

So far 76 trustees representing funds with £367 billion of assets, three times the annual spend on the NHS, and managing the pensions of 4 million people, the equivalent of more than one in eight of the UK’s workforce, have signed up to the charter. The trustees have signed the charter in their personal capacities, which this is not binding on the pension funds they represent, trustees expect a rapid sea change in the way their pension funds allocate assets.

 

Our co-founder, Dawid Konotey-Ahulu, explained: “The investment community has the power to make a meaningful difference in the fight against climate change, and it needs to use this power now. What the Climate Charter will achieve is that at every trustee meeting of pension funds someone will ask: ‘If we make this investment, what is the impact on the climate?’, putting the climate emergency at the top of the agenda. We want everyone to ask their pension fund provider what they are doing to combat climate change.”

 

Paul Trickett, who chairs the Railpen Investment Board and the trustee board at Santander UK, said: “The time has come for asset owners to focus on this as a core part of their investment decision-making. Investment returns should not suffer in the long run, though they may do in the short term which means asset owners will need to balance conflicting priorities - but they are used to that.” 

 

Mark Tennant, chairman of a FTSE 100 pension fund with £8 billion of assets, said: “The problem we have with climate change is that everyone talks about it and everyone is deeply concerned, but very little is being done. The Pensions Industry as asset owners should be working with Government to achieve the goal of net zero by 2050.” 

 

The Climate Charter was created following a summit of pension fund trustees in June where it was decided that the climate emergency was so critical that action had to be taken immediately. Trustees of some of the UK’s largest pension funds are represented among the signatories – including Lloyds Banking Group, National Grid, Aviva, Nestle UK and Santander UK.

 

Starting today, mallowstreet is calling on the members of all pension schemes – including employees and those who have retired – to write to the trustees of their schemes demanding they sign up to the Climate Charter and take immediate action to save the environment.