Brunel Pension Partnership records 35% fall in carbon intensity

The Brunel Pension Partnership has recorded a 35 per cent reduction in its carbon intensity compared to 2019, its annual Responsible Investment and Stewardship Outcomes report has revealed.

The report showed that, compared to its benchmark, the aggregate portfolio is 27 per cent less carbon intensive on a Weighted Average Carbon Intensity (WACI) basis and 35 per cent less than the baseline set in 2019.

Portfolio decarbonisation was previously highlighted as a principal target for Brunel's 2020 climate change policy, with the partnership targeting a 50 per cent reduction in carbon intensity by 2030.

This is part of Brunel's new climate change policy that extended its previous five-point plan to 2030 following on from its first climate stocktake in 2022.

The policy was developed in collaboration with clients and key stakeholders, with key targets consistent with the Net-Zero Investment Framework (NZIF) and its target setting guidance.

In particular, Brunel has committed to being net zero on financed emissions by 2050, with the goal of limiting global temperature rise to 1.5°C, and net zero on its operations (scope 1 and 2) by 2030.

In addition to this, it aims to have 100 per cent of UK sovereign issuance subject to direct or collective engagement, and to have all listed assets achieving net zero or meeting the criterion considered to be aligned or aligning by 2040.

By June 2024, Brunel also committed to setting alignment targets for corporate bonds, infrastructure, real estate and secured income consistent with the NZIF and a timeline for target setting in other assets classes.

The report also highlighted the work already done by Brunel, revealing that, in 2022, 1,416 company meetings were voted at, representing 99 per cent of the voteable meetings.

‘Against’ recommendations were made for 813 meetings (60.7 per cent) and with management-by-exception recommendations for 4 meetings (4.3 per cent); board governance and remuneration remained the areas of highest dissent.

At least one milestone was moved forward for about 54 per cent of objectives during the year, with 899 companies engaged with by Federated Hermes (EOS) on Brunel's behalf.

The report highlighted work around the real living wage in particular, revealing that engagement work with Sainsbury's in 2022 secured a pay uplift for 19,000 people.

Commenting on the report, Brunel Pension Partnership chief responsible investment officer, Faith Ward, stated: “2022 has seen some fantastic progress across our responsible investment priorities.

"Our Climate Stocktake has been a great step forward, allowing us to really interrogate whether our actions are having the outcomes we want them to.

"Alongside this, a highlight for me, must be supporting an action that raise the issue of the real living wage – and also led to pay increases for 19,000 Sainsbury’s employees.

"Our outcomes report shines a spotlight on the hard work undertaken by Brunel and how our responsible investment approach is embedded in everything we do.”

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