The sum of pension schemes committed to robust net zero has reached £1trn in the UK alone, research by Make My Money Matter found.
The campaign defines a ‘robust’ net zero commitment as working towards:
- Achieving net zero emissions by 2050 “at the absolute latest”;
- Halving emissions no later than 2030; and
- Having made a serious individual commitment or signed up to at least one of: A4S Pension Fund Chair Net Zero statement of support; the Paris Aligned Investment Initiative; or the Net Zero Asset Owner Alliance.
Make My Money Matter also discovered that public awareness around the connection between money and climate change has soared since the beginning of 2021, in tandem with expectations for pension providers to offer green alternatives to their customers.
Several businesses across the UK have started taking action on this with firms such as Aviva, Scottish Widows, Ikea, Tesco, Brewdog and Innocent Drinks among the 71 companies that signed up to the campaign’s Green Pension Charter.
This means they pledged to explore “greening their company pension scheme so that it is invested more sustainably and is aligned to net zero”, Make My Money Matter said.
Still, £1.7trn of UK savers’ money remains invested in schemes that have not yet aligned with the Paris Climate Agreement.
The campaign believes that after COP26, the pressure is now on those companies to commit to robust net zero targets.
Time is ‘running out’
Richard Curtis, co-founder of Make My Money Matter, said: “Since we launched in June 2020, we have seen a range of providers step up to the plate on climate change by committing to robust net zero targets.
“This movement has seen an incredible milestone at the turn of the year, with £1trn of UK pension money now committed to align with the Paris Climate Agreement – a huge success for climate campaigners.
“However, with time running out, £1.7trn is still in schemes that have failed to make robust commitments, and we have a pensions industry that enables a staggering 330 million tonnes of carbon to enter our atmosphere every year – equivalent to the UK’s annual carbon footprint – so urgent action is needed right now.
“That’s why this year our campaign will be working to ensure the entire UK pensions industry is aligned with robust net zero, while eradicating other harmful practices from our pensions, such as deforestation. In doing so, we can help protect the planet, protect savers’ returns, and ensure our pensions are building a world worth retiring in to.”