The Work and Pensions Committee has today
launched an inquiry
into the Government’s approach to ensuring pension schemes
consider the risks to funds posed by climate change and the role
schemes can play in meeting emission reduction targets.
Following a consultation at the
start of the year, the Government is due to bring in
regulations for pension schemes on managing climate risk ahead of
the UK hosting the COP26 climate conference in Glasgow in
November.
The Committee’s inquiry is examining the Government’s approach to
pension scheme stewardship, how it compares to approaches taken
internationally, and how funds can be supported to make
climate-conscious investment decisions.
Rt Hon MP, Chair of the Work and Pensions Committee,
said: “The UK’s commitment to cutting emissions to net zero
by 2050 will have far-reaching consequences for all sectors of
the economy as they adapt to the need to decarbonise. Pension
schemes will undoubtedly want to consider the impact climate
change and the measures to cut emissions will have on their
portfolios. Unless they are wise to the risks and the need to
adapt investments, there will be a knock-on effect on people’s
pension pots.
Our inquiry will be examining how the Government can inform
and be informed by international practice emerging from COP26 and
how they ensure schemes consider the risks to pension funds posed
by climate change and provide help for them to support emerging
technology through greener investments.”
Terms of reference
The Committee would like to hear views
on the following questions. You don’t have to answer all of
the questions. You can respond on behalf of an organisation, or
as an individual.
- How should pension schemes contribute to setting COP26
targets and helping to achieve the targets once agreed?
- What role should international standards have in supporting
pension schemes to assess climate change risks when considering
scheme investments?
- Are there suitable financial products to enable pension funds
to make climate-conscious investments? How should such investment
be facilitated and supported?
- How should the UK seek to share and learn from international
best practice?
- What regulatory changes or other government action has been
most effective in delivering change in the UK; and what changes
on the part of Governments elsewhere should the UK learn from?
- Do pension schemes have suitable information to assess
climate risk, or do there need to be international reforms to
financial reporting?
The deadline for submissions is Friday 18th June.
