Pensions - Articles - Pensions Minister echoes climate warnings in Westminster

MPs from across the House of Commons have debated climate change and pensions. Pensions Minister Guy Opperman responded. Earlier he spoke of ‘kickstarting a wholesale change’ in the way the pensions sector approaches climate change.

 Responding to the developments, ClientEarth climate finance lawyer Megan Clay said: “The Pensions Minister warned pension fund trustees that they will be breaching their statutory duties if they do not take into account the risk of climate change. This is hugely significant and shows the government feels climate risk and opportunities should be central to pension funds’ investment decisions. Pension fund trustees must take note.

 “If catastrophic climate change is allowed to continue on the current trajectory, pensions savings will suffer, as will quality of life in retirement.

 “The law already requires trustees to consider the financial risks posed by climate change when making their investments. But we hope that these conversations will lead to new legislation clarifying and strengthening this duty to push pension funds to invest in line with the Paris Agreement. That means they, and their savers, will support and benefit from the transition to a low carbon economy.”

 The Minister went on to observe that the UK’s pensions regulator is ‘acutely mindful’ of the risks climate change poses to pension funds and may take punitive measures.

 ClientEarth has already alerted the Pensions Regulator to multiple funds they believe are falling short on climate risk action.

 Clay said: “Proper enforcement of investment regulations in respect of climate change is crucial. The Pensions Regulator must make sure the right resources are available to ensure that trustees who continue to breach their duties by neglecting climate change are held to account.”

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