Govt to launch call for evidence on schemes’ integration of social factors in investment and stewardship

Pensions Minister, Guy Opperman, has revealed plans to launch a public call for evidence to understand to what extent financially-material social factors are currently integrated into pension schemes’ investment and stewardship activities.

Speaking at the TUC Pensions Conference, Opperman noted that pension scheme members, trustees, and society as a whole were “more in tune” to corporate governance “than ever before”.

“I’m therefore actively considering the effectiveness of trustees’ current policies and practices in relation to social factors,” he continued.

“I’m keen to understand to what extent financially-material social factors are currently integrated into their investment and stewardship activities.”

Opperman noted that he had written to 40 large pension schemes to find out more about their current practices and that officials are “considering the responses”.

“I’m bringing forward a public call for evidence to discover more in the near future,” he added.

Alongside this, Opperman said that he was exploring ways to quicken the pace of consolidation “substantially” and that there will be “more of in the way of consolidation in the years ahead”.

Considering pension schemes’ participation in helping the UK become a net-zero economy by 2050, Opperman reiterated his belief that engagement was the way forward with companies not meeting net-zero goals, rather than divestment.

The recently passed Pension Schemes Act included new climate-reporting requirements for pension schemes, with Opperman previously confirming that he expected the regulations to be in place ahead of COP26.

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