DC scheme member interest in responsible investment climbs

Defined contribution (DC) scheme members have become more interested in environment, social and governance (ESG) issues amid the coronavirus pandemic, according to the Defined Contribution Investment Forum (DCIF).

In a survey DC savers, the DCIF found that two thirds (66 per cent) of respondents were more worried about the state of the world and felt personally responsible for making a difference, compared to 59 per cent in 2018.

Women felt more strongly about the issue than men, by 71 per cent compared to 61 per cent.

DCIF chair, Hilary Inglis, said: “At the DCIF, we think that Covid-19 could accelerate an already growing momentum which is propelling the pensions industry towards responsible investment.

"As more and more people realise that their pension savings are invested in companies which power the world around us, pressure will grow to make sure their money invests in well run companies, which are more supportive of the environment and wider society.

“In turn, this will put pressure on pension scheme decision-makers like trustees, finance and HR directors to consider these issues when they choose their pension scheme.”

As well as this increased interest in ESG issues, the survey found that 82 per cent of members believed society would be permanently changed by the coronavirus pandemic.

More than half (57 per cent) of respondents who could work from home said they would choose to do so more often, while 59 per cent said they would attempt to reduce their carbon footprint by attending online meetings and travelling less.

Almost three quarters (74 per cent) of members would consider boycotting brands or companies who had not treated their employees well during the pandemic, while 79 per cent said the treatment of employees during the crisis would also factor into their next job move.

More than three quarters (77 per cent) of respondents felt there was a greater sense of community spirit during the crisis, while 79 per cent indicated they were now more interested in trying to help small and local businesses.

“Although this has been an overwhelming time of stress and anxiety, halting everyday life in this way has caused some people to reflect. Seeing clearer night skies, enjoying fresh air and relieved of the daily grind of a daily commute, many people have no desire to go back to the way life was before, as this survey reflects,” said Inglis.

DCIF executive director, Louise Farrand, commented: “Making a change for the better requires action from all players in the pensions chain, from investment managers to the consultants which advise schemes and the trustee boards which hold them to account. Members of the DCIF are committed to learning and finding real-world ways to help.

“We want pension savers to be able to investigate how their money is invested and be satisfied by what they find. As they re-evaluate some aspects of the world they live in, this will become more important than ever.”

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