Smart Pension sets 2040 net-zero target for default growth fund

Smart Pension has announced that its default growth fund will be net zero by 2040 and will have halved its emissions between 2019 and 2025, ahead of the goals of the Paris Agreement, which called for emissions to be reduced by 45 per cent by 2030 and to reach net zero by 2050.

Much of Smart Pension’s default growth fund is already invested in companies with a strong focus on ESG and, going forwards, the fund will invest even more into companies that it sees as innovating for good, including those working to improve energy efficiency, transition form fossil fuels and create sustainable agriculture.

Smart Pension also plans to give members an increased choice of investments based on how sustainable they want their pension to be.

The announcement follows the company’s recent move to one of the first all-electric buildings in London’s West End, powered entirely from renewable sources and operationally net zero.

A sustainability hub has also been launched on Smart Pension’s website providing full details of its journey towards net zero.

Smart Pension has credited its efficient technology platform as enabling it to provide an affordable offering to employers and members, allowing it to make more sustainable investments which benefit people and the planet.

Smart’s technology uses AI and guided navigation tools to make retirement savings "straightforward and accessible to all".

Smart is backed by J.P. Morgan, Barclays, Legal & General Investment Management, Natixis, Chrysalis Investments as well as others.

Smart Pension managing director, Paul Bucksey, commented: “Although sustainable investments can be more expensive than more traditional investments, a key advantage of having a very clean and efficient platform is that we can keep our admin costs low, allowing us to spend more on higher-quality, ESG-friendly investments without increasing member charges.

“With the success of industry action groups such as Make My Money Matter, and from our own research, we know that our members are increasingly looking at what their pensions savings are doing as they accumulate. Smart Pension is leading the pack with more of our assets invested in sustainable funds than ever before, and with us providing savers with the opportunity to invest in even more sustainable funds.

Smart Pension head of investment proposition, James Lawrence, added: “We believe that Smart Pension is well ahead of its industry competitors when it comes to sustainable investing. We're always reviewing our investments and looking to the future at how we can commit even more to innovative sustainable funds that benefit society and the environment, whilst also providing strong outcomes for our members.”

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