The Trustee Sustainability Working Group (TSWG) is calling for a temporary pause on pension scheme climate reporting, arguing that freeing sustainability experts from box-ticking compliance could be the “silver bullet” to unlock UK pension capital for domestic growth and the energy transition.
According to independent trustee and chair of the Trustee Sustainability Working Group (TSWG) Bobby Riddaway, a moratorium on reporting would give sustainability experts the space to act.
He says: “The regulators have realised disclosures are too heavy and not action-oriented. While they review that, why not a moratorium? These experts are snowed under reports but they are the people who need to make it happen.
“Trustees and sustainability experts are trapped in a compliance treadmill. We are measuring the problem rather than solving it. Freed from TCFD and implementation statements, we could redirect resources into infrastructure, venture capital, and domestic climate solutions.”
He stresses the importance of “giving permission to trustees and confidence to consultants”. He adds: “Sustainability trustees and consultants can push the market, but they need authority and backing. It’s not about five years of research and long fund lists. It’s about using due diligence efficiently and unlocking new private market structures.”
Riddaway says the temporary pause would allow sustainability experts to focus on educating trustees, developing structured finance models and co-investing across schemes. But in the longer term he recommends replacing TCFD with transition plans for larger schemes and introducing simplified stewardship initiatives for smaller schemes.
Riddaway points out that UK companies often struggle to scale domestically. He notes that many private investment firms reach “unicorn” status only to be acquired by US investors due to the limited availability of growth capital in the UK.
He says: “At the moment, what pension schemes are doing, they’re just gripping money. The government needs to free up all this resource and point it towards it. That frees up all the enthusiastic experts in the sustainable industry, pensions, asset owners, trustees and consultants. Then people can go in, find the right opportunities, and help scale them.”
The UK’s £1 trillion private pension sector remains underutilised, with smaller DB schemes largely untouched despite reporting requirements for those over £1 billion. Riddaway says: “The potential for all schemes to support UK growth is enormous, not just the large master trusts or the LGPS.”
Meanwhile, small schemes face structural barriers such as risk aversion, reliance on lengthy consultant fund lists and unfamiliarity with private assets. He says: “Private assets can offer stable long-term returns, particularly in infrastructure and climate-related ventures. The industry just needs guidance and confidence to act.”
Riddaway believes pooled resources and practical transition plans are the solution. He says: “What we need here is what happens in emerging markets. You’ve got infrastructure being built where a development risk is taken by a bigger finance layer, then lower-risk private equity or debt becomes institutionalised.”
He proposes small schemes adopt a transition plan with three practical tools, ensuring consultants push government frameworks, participating in coordinated stewardship and targeting a few high-impact sustainability projects each year.
Riddaway adds that with many high-growth climate and biodiversity companies being acquired by the US, UK pension schemes have a strong case to back these ventures at home.
He adds: “Shifting pension scheme investment into climate solutions is anything but easy. It needs new structures, government collaboration, and execution.”
He notes that freeing experts from reporting is key. “If you free them up, they won’t get distracted with dashboards and compliance. These are the people who really care about the climate, and you’re going to take this massive resource to make a difference.
“We have UK companies worth investing in, and the government’s ambition to get money into the UK economy ties in. If the government flicks this switch, it could be the first time we see very short-term change in pension scheme investment.”