Significant FTSE100 corporations’ pension assets are producing seven times more carbon emissions than their respective businesses, according to a new analysis by Richard Curtis’ climate finance campaign Make My Money Matter and Scottish Widows.
Research conducted by Make My Money Matter reveals that less than half or 45 per cent of CEOs and business executives are aware that their organisation’s pension plan may be contributing to climate change and that fewer than 10 per cent of FTSE100 companies have included pensions in their sustainability plans.
According to research by the sustainability research firm Route2, the investments made in large corporations’ company pension plans are undermining their efforts to operate more sustainably. In reality, an estimated 131 million tonnes of unaccounted carbon are currently funded by the assets of FTSE100 pension plans to enter our atmosphere each year.
Make My Money Matter co-founder Richard Curtis says: “This report leaves us in no doubt – pensions are one of the most powerful tools UK businesses have to tackle the climate emergency.
“But for too long, businesses have failed to capitalise on this opportunity – company pensions now finance a staggering 7 times more carbon than the emissions produced by those same businesses. For organisations to be acting credibly and decisively on climate, green pensions must be a crucial part of their plans.
“We hope this report acts as an urgent wake-up call and puts company pensions – and the billions invested by them each year – at the heart of all organisations’ sustainability strategies. Doing so will not only help companies tackle climate change, but also send a powerful signal to the pensions industry that it’s time we all made our money matter in the historic fight for our planet and the people who live on it.”
Scottish Widows head of pension investments Maria Nazarova-Doyle says: “With over £2.7 trillion invested in pensions in the UK, we simply can’t overlook the significant impact our pensions have on the future success of a net-zero economy – and ultimately, on the livelihoods of people and the planet.
“As this report shows, whilst progress has been made, there is a huge amount of work yet to be done in helping employers ensure their employees’ savings are invested in sustainable ways. Many companies simply aren’t aware of how their pension schemes are undermining or even undoing the sustainability progress they are making across their operations.
“Today’s workforce expects its employers to take an active stance on social and environmental issues. With the help of providers, business leaders now have real opportunity to unleash the power of pensions as a force for positive change and ensure their employees’ retirement savings are channelled into sustainable portfolios. In doing so they will show staff that they are serious about investing their money responsibly.”
