Pension fund trustees will have to account for climate risk and ESG factors in their investment decisions under new regulations unveiled by the UK government. The plans, announced by the Department for Work and Pensions on 11 September, will require all trust-based pension schemes to explain how funds are invested, with a specific emphasis on risks connected to climate change and low carbon transition. “Climate change is one of our biggest challenges – it has huge implications not just for society but also for individual pensioners,” said Andrew Tyrie, chief executive of the National Pensioners Convention, which represents Failure to comply could see fines of up to £50,000 ($65,000) for organisations or £5,000 for individuals.
Pension fund trustees will have to account for climate risk and ESG factors in their investment decisions under new regulations unveiled by the UK government. The plans, announced by the Department for Work and Pensions on 11 September, will require all trust-based pension schemes to explain how funds are invested, with a specific emphasis on risks connected to climate change and low carbon transition. Statements of investment principles must be updated by October 2019 and followed by annual reports on such risks. Failure to comply could see fines of up to £50,000 ($65,000) for organisations or £5,000 for individuals.