News for trust-based schemes
Trustees are subject to legal requirements when setting their investment policy and choosing investments, and this includes a requirement to take account of Environmental, Social and Governance (ESG) factors, including climate change.
Since 1 October 2021, trustees of schemes with assets of more than £5 billion and all authorised master trusts, have been required to produce and publish a Task Force on Climate-related Financial Disclosures (TCFD) report online in a publicly available format. It is likely that this requirement will extend to most schemes by 2025. This is in addition to the previous requirements for schemes to clarify and explain their policies regarding ESG, including climate change, that became law in October 2019. As a result of these new regulations, it is essential that trustees have a clear strategy on ESG.
The Pensions and Lifetime Savings Association (PLSA) has produced a Guide to help trustees understand ESG as an investment concept and show how it can be integrated into the investment strategy and oversight of pension schemes.
The Guide, produced in partnership with Aegon: