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Pensions: Risking More than Your Money

As we consider a post-pandemic future, we want to help build a resilient economy that supports our shared health, communities and environment. The climate crisis presents a devastating risk to this aim, but we can all take action to change how this story evolves.

To do this, nearly all of us have two important tools at our disposal: our pensions and the law.

Will you join us so we can work together to use them?

How these tools can change the world.

Understanding how your pension contributes to the problem and can be the solution is one of the single most impactful things you can do.  Here’s why.

The power of our pensions

Your pension may be your greatest contribution to the financial system. It is money you are earning right now, invested in financial markets to secure savings which will support you in the future.

At the end of 2019 UK pensions alone were invested in assets worth approximately £3.0 trillion. But, a large proportion of these investments continue to be channelled into industries which fuel dangerous climate change.

How your pension is invested has a direct impact on the health of our planet, as well as the security of the economy and your savings.

The power of the law

The law is the most powerful tool we have.  The people who invest your pension savings (trustees or providers) are legally required to act in your best interests to look after your savings, and to consider and manage climate-related financial risks and opportunities.

We believe that this means pension trustees and providers have a legal duty to act strategically on climate risks impacting your pension and capitalise on the investment opportunities presented by the transition to a low carbon economy.

But many pension schemes are lagging behind.

Pick up the pace

Forty years have passed since scientists met at the First World Climate Conference in 1979 and agreed that alarming climate change trends required urgent action. In 2015, the UK and other nations signed the Paris Agreement, committing to pursue efforts to limit global warming to 1.5°C, and in 2019 the UK passed laws to end its own contribution to global warming by 2050.

The law makes powerful, lasting change. But we need your help to pick up the pace. We don’t have another 40 years.

Who we are

Our Climate Finance work is speeding up the transition to a low carbon economy. We use the law to make climate-related financial risk a key consideration for all investment decisions – including how your pension is invested. Our approach works because law is a language governments and business listen to and understand. We want you to be involved too.

 

 

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Nate Hess