As new research suggests an overshoot of the 1.5°C temperature goal looks increasingly likely, defined contribution (DC) pension scheme providers must provide transparency on how their actions address climate change on behalf of their members. 

Our latest research highlights an overwhelming focus on climate transition risks, but we increasingly expect providers to access opportunities across climate, nature and social themes and, in time, greater focus on managing climate physical risks. Providers must be able to articulate what specific sustainability-related risks and opportunities they are trying to manage. 

Long-term targets are not enough: actions must speak louder than words.

"Climate change has dominated the sustainability agenda for investors. The financial risk of climate change cannot be understated."

Key findings

Read our Sustainability in DC governed default investment strategies report to learn:

  • Why providers must support industry efforts to improve data and offer in-depth reporting on trends in the sustainability of their investments. 
  • The importance of articulating specific risks and opportunities which providers are trying to manage using the different building blocks in their portfolio.
  • How providers must build on their progress to date and address sustainability for assets other than equity.
  • Why providers must take care when de-coupling voting from engagement.

Read Sustainability in DC governed default investment strategies

Our third annual review explores the importance of providers’ commitment to sustainable investing and the actions they have taken.


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