Almost three-quarters of UK pension schemes now have a net zero plan in place or plan to do so within the next two years, according to a survey carried out by the Pensions and Lifetime Savings Association (PLSA).
The trade body’s survey – which reflects responses from more than 90 pension schemes – found schemes are “making progress” towards net zero commitments, revealing 74 per cent of schemes have, or will soon have, a net zero plan in place.
It comes as new Taskforce in Climate-related Financial Disclosures (TCFD) requirements are set to come into force for more schemes later this year, setting requirements those with assets of more than £1bn. As a result, the PLSA said the number of schemes making net zero commitments is “expected to grow further still”.
The survey also found 63 per cent of schemes have started working on their TCFD report, with more than half (55 per cent) saying they are in the scope of the reporting deadline so plan to publish one this year.
Additionally, 28 per cent said they have already published their TCFD report, despite it not being a mandatory requirement.
In terms of stewardship, climate transition plans are seen as the top priority for two thirds (68 per cent) of investors, while 56 per cent see net zero targets and a key priority, and board diversity and human rights are seen as priorities for 37 per cent and 35 per cent respectively.
“Our survey found that around three quarters [of pension schemes] Either have, or will shortly have, a plan to align their investments with a net zero objective by 2050,” said director of policy and advocacy Nigel Peaple, “Many pension schemes are already assessing the impact of their investments in the context of the goals of the Paris agreement. Striving to improve investment practices, and robust transparency standards across the investment chain, are an essential part of ensuring schemes can act as responsible stewards on behalf of millions of UK pension savers.”
He continued: “As we enter the next phase of scheme reporting, it is important that the largest companies and asset managers meet institutional investors’ expectations, by enhancing their climate impact disclosure, as well as fully implementing their regulatory responsibilities within the TCFD regime. “
A version of this article originally appeared at Professional Pensions.