Millions of savers’ money invested in polluting industries, despite public demand for change

A new report by Make My Money Matter reveals that UK pension providers are failing to adequately address climate change, despite growing public pressure and their own commitments to net zero emissions. The report, “2024 Climate Action Report,” analyzes the climate action plans of the UK’s 20 largest Defined Contribution pension providers and finds:

• No provider takes a leadership role on climate action.
• Only 3 providers (Aviva, Legal & General, and Nest) have “adequate” plans.
• 13 providers, including household names like Standard Life, Royal London, and Prudential, have “inadequate” plans.
• 4 providers score the lowest, with “poor” plans averaging just 1/10 for climate action.
• All providers fall short on tackling fossil fuel financing and deforestation, two critical areas.

Key Findings:

• £88 billion of pension savers’ money is invested in fossil fuels, with 8 out of 20 providers scoring 0/10 for this issue.
• Just over half of providers have made a commitment to tackle deforestation, but lack comprehensive policies and measurement.
• Providers perform best on commitments to 1.5 degrees, measurement and disclosure, and stewardship instruments.

Recommendations:

• Set ambitious 1.5-degree aligned goals with short-term emission reduction targets.
• Develop detailed targets for key sectors and asset classes, covering the full value chain.
• Phase out fossil fuel assets, particularly coal, and ensure alignment with the IEA net zero scenario.
• Publish and act on comprehensive deforestation policies, including targets for Agriculture, Forestry, and Other Land Use emissions.
• Scale up investments in climate solutions and remove any barriers to such investments.
• Strengthen divestment, exclusion, and voting policies to ensure effective stewardship.

Call to Action:

• Savers can send personalized messages to their providers via Make My Money Matter’s website.
• Employees can share the report with their employers and encourage action.
• Employers can engage directly with providers and consider switching to greener providers.

Related Article: JPMorgan Out, BlackRock Scales Back: Major Setback for Climate Action 100+

The report concludes that the UK pensions industry must urgently step up on climate action to protect savers, the planet, and the future well-being of millions.

For more information and to take action, visit:

View Full Report