Pension fund chairmen overseeing a collective £267.9 billion ($372.2 billion) of pension assets committed Wednesday to set net-zero emissions targets.
The 14 signatories to the A4S Pension Fund Chair Net Zero Statement of Support pledge to align their investment portfolios with a path toward a 1.5 degrees Celsius rise in temperature, and commit to four other actions within the next 12 months. The statement was coordinated by the Accounting for Sustainability Project at the Prince of Wales's Charitable Foundation.
Signatories include the chairs of HSBC Bank Pension Trust U.K. Ltd., Barclays U.K. Retirement Fund, Unilever U.K. Pension Fund, Tesco PLC Pension Scheme, BT Pension Scheme, National Employment Savings Trust, Scottish Widows Master Trust and Health Employees Superannuation Trust Australia.
The statement recognizes the challenges and scale of the transition needed, and that climate change threatens the plans' ability to uphold their fiduciary duty in providing long-term, risk-adjusted returns to their members.
"Our responsibilities include driving capital towards positive outcomes, being a catalyst for innovation and opportunity, helping to finance the transition to a net-zero global economy, investing in resilience to protect against physical risks and restore nature, and leveraging our influence across the investment chain," the statement said.
Within 12 months, the signatories intend to take the following steps:
- Committing to set net-zero targets to align investment portfolios with a 1.5 degrees Celsius pathway.
- Expect direct service providers to support this ambition.
- Being an active shareholder across all relevant asset classes invested in.
- Collaborating with peers on innovate ways to bring influence.
- Attempting to understand climate risk in a holistic manner and manage the risk factors within investment portfolios, including physical and transition risks.
Many of the signatories belong to the Accounting for Sustainability's Asset Owners Network, a group of pension fund chairmen and trustees working on practical steps to integrate sustainability into investment decision-making.
"Pension schemes are highly exposed to the risks of an unsustainable future, but also powerfully positioned to influence a sustainable outcome. The pension fund chairs who are signing our Net Zero Statement of Support are committing to address the risks of climate change and invest in a resilient, sustainable future. A4S will be supporting this commitment through our practical guidance," said A4S Executive Chairwoman Jessica Fries in the release.