Consultants back ESG initiative for pension schemes

The UK pensions regulator’s guidance that pension schemes take into account environmental, social and governance (ESG) factors where they are financially material received a boost from investment consultants.

Twelve investment consultant firms have agreed to ensure clients are made aware of The Pensions Regulator’s (TPR) guidance.

The firms are Allenbridge, Aon Hewitt, Barnett Waddingham, bfinance, Cardano, Hymans Robertson, JLT Employee Benefits, Lane Clark & Peacock LLP, Mercer, Quantum Advisory, Redington and Willis Towers Watson.

In a joint statement they said:“We believe that ESG is a fundamental part of success in long-term investing, therefore we are drawing the guidance to the attention of UK pension fund clients through a variety of routes such as putting consideration of ESG on trustee meeting agendas, issuing briefings and/or holding training sessions.”

They said the also recognised the “significant role that client-facing consultants can play in ensuring that our clients are well informed on the issues”.

Fred Berry, lead investment consultant at the regulator, said TPR welcomed the initiative, which had been convened by the Association of Member Nominated Trustees and the UK Sustainable Investment and Finance Association.

Berry said: “We know from our research with trustees that many, particularly lay trustees, rely on their advisers to keep them up to date with our news and guidance. We expect investment consultants and others advising pension schemes to support trustees to manage risks to member benefits, including risks to the sustainability of the scheme’s investments.”

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