Smart Pension will now invest in JP Morgan’s Carbon Transition Global Equity ETF within its default offering.
The ETF is invested in companies that are focused on the shift towards a lower carbon economy. The fund is classified as Article 9 by the Sustainable Finance Disclosure Regulation, a technical standard introduced last year by the European Commission.
The ETF is aligned with the European Union’s Climate Transition Benchmark framework, meaning it will be at least 30 per cent less carbon intensive than the market average, and reduce its own carbon footprint by at least 7 per cent per year.
Smart Pension says this investment is part of its wider initiative to ensure the default growth fund is net zero by 2040.
Smart Pension has made considerable progress in incorporating investments with a strong sustainability focus into its portfolio, and claims it is the first UK pension provider to offer customers a range of growth funds that are all fully sustainable, including the Smart Pension default fund, in January 2023.
Smart Pension chief investment officer Paul Bucksey says: “We are focused on achieving great outcomes for our members. We want to help them secure long-term financial growth and a safer, healthier world in which they can retire.
“We chose JP Morgan’s Carbon Transition Global Equity (CTB) UCITS ETF because it is committed to companies carrying out simple changes to make a big difference: lowering their carbon emissions, reducing harmful waste and improving their sustainability processes. Now more than ever before, investing in a lower carbon economy is crucial for our future.”