LifeSight, a U.K. defined contribution multiemployer plan, pledged to cut half of its carbon emissions in its default funds by 2030.
As part of its efforts to reach net-zero carbon emissions by 2050, Willis Towers Watson's master trust, which has £10 billion ($13.9 billion) in assets, will engage with portfolio companies daily on ESG issues such as climate change, human rights and responsible supply chains.
The firm's spokesman said some divestment might be needed where investments may violate international norms and present reputational, regulatory or ESG risks that are unlikely to be addressed through engagement. The size of the divestment needed will evolve over time, he added.
Assets are invested across nine strategies run by external managers, the LifeSight Equity Fund and the LifeSight Diversified Growth Fund.
This month, LifeSight will also launch a new investment option, the Climate Focused Fund, which will exclude companies with links to fossil fuels, instead focusing on firms with lower carbon footprints. It will invest in firms seeking to transition their business models to the low-carbon economy or businesses that are solving environmental challenges. The new equity fund will be available to plan participants as an optional selection.
The strategy will also invest in companies and projects that can help reduce waste and pollution, as well as improve biodiversity.
"We recognize that climate change and an orderly transition to a net-zero economy represent systemic and urgent global challenges. To avert the worst outcomes, it is critical to limit increases in global average temperatures in line with the goals of the Paris Agreement as a sustainable future for society and the planet is clearly in the direct financial interests of our members," said Jane Platt, chairwoman of trustees at LifeSight, in a news release Thursday.