TPP divests £226m from companies failing to meet ESG standards

The People’s Pension (TPP) has removed £226m worth of investment from companies that have failed to meet its environmental, social and governance (ESG) standards.

It worked closely with its fund manager, State Street Global Advisors (SSGA), on the policy, leading to the initial removal of 150 stocks from its portfolio.

The divestment relates to arms companies and organisations linked to “severe” controversies involving human rights, labour, environment, and corruption.

Commenting on the announcement, B&CE, provider of TPP, managing director of investments, Jon Cunliffe, said that the scheme divested from the companies that failed to meet its ESG standards due to “the risks they pose to member accounts and the reputation of the scheme”.

He continued: “We have removed investments from these holdings, in the best interest of our members, as engagement with companies which flagrantly breach good practice is unlikely to work.

“Both SSGA and our trustees have worked very hard to get to this point, and we know that this decisive action will have the support of our members as our polling tells us that responsible investment is important to them.

“These exclusions underline our commitment to being a responsible investor, which we put at the heart of our decision making.”

SSGA managing director, head of retirement strategy, Alistair Byrne, added: “ESG considerations are an increasingly crucial aspect of the investment strategy of any pension scheme.

“We are delighted to have been able to work with TPP to design and implement these changes, creating a more robust and sustainable default fund for their millions of members. We look forward to continuing our collaboration to evolve the ESG strategy of the scheme.”

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