Pensions and life insurance giant Scottish Widows has rolled out plans to decarbonise its investment portfolio and halve emissions by 2030 as it becomes the first major pensions provider to confirm a net zero strategy.
Scottish Widows, which manages £190bn savings for more than six million customers, has laid out a series of commitments to hit net zero by 2050 including investing £20-25bn into “climate aware investment strategies’, and “excluding high carbon investments from its portfolio.
Maria Nazarova-Doyle, head of pension investments and responsible investments at Scottish Widows, said: “Controlling trillions of pounds worth of investments, the pensions industry has a responsibility to act as a responsible steward for the success of climate solutions – and to exclude investments in high-carbon companies which are resistant to change.
“We look forward to other providers joining us and helping set out how the UK pensions industry will achieve large-scale net zero commitments, setting a clear expectation for high-carbon sectors resistant to change.”
The pensions giant also said it would pump a further £3bn investment into Blackrock’s Climate Transition World Equity Fund, on top of an existing £2bn allocation.
Scottish Widows’ net zero strategy comes after the Chancellor, Rishi Sunak, announced plans to mandate financial institutions to publish net zero transition plans at Cop26 in November.
Pensions providers control around £2.6trillion and pension funds have come under increased pressure from campaigners to throw their financial heft behind green investment strategies.
Make My Money Matter, a campaign backed by Love Actually director Richard Curtis, has launched a Green Charter calling on the pensions industry to agree net zero targets for all investments
Tony Burdon, CEO at Make My Money Matter said he hoped the commitment from Scottish Widows would spur progress across the industry.
“We welcome today’s announcement as an important step from Scottish Widows – turning their ambitious net zero commitment into a practical plan of action”, he said.
“By detailing both their plans to halve emissions by 2030, and announcing increased investments into climate solutions, Scottish Widows is helping drive a race to the top amongst the pensions industry.”