The National Pension Trust is launching a new sustainable default strategy.
This shift to its default strategy will affect around 44,000 members invested in this master trust. In total around £978m of assets will be invested in the new ESG-orientated default arrangement, which has a particular focus on climate change and the carbon transition.
The new investment strategy will see NPT act in partnership with State Street Global Advisors, the Transition Pathway Initiative (TPI), and Legal and General Investment Management to align its portfolio with the goals of the Paris Agreement and inform its investment research.
The TPI seeks to speed the transition to a low-carbon economy by weighting investment towards those companies that can demonstrate that their operations align with Paris Agreement targets, and which meet the recommendations of the Taskforce on Climate-Related Disclosures (TCFD).
NPT, the master trust run by XPS Pensions Group, say the change affects 100 per cent of the assets held in its default fund and invested in growth strategies.
Paul Armitage, head of the National Pension Trust says: “Climate change poses a real risk to our future, which is why we want to make the way we invest assets more sustainable. That’s why we have selected the TPI – it achieves our initial goals for reduced carbon exposure today, reducing carbon related metrics by around 50 per cent now – but also incentivises a transition to future lower carbon intensity for businesses around the world by allocating capital to those firms that do it best.”
National Pension Trust chair of trustees Ian Davies adds: “Developing our new default fund is an important step for the National Pension Trust. It is another example of how NPT is committed to providing market leading investment strategies that reflects the preferences of our members while helping employers meet their ESG responsibilities.”
