DC master trust to ditch managers who underperform on climate
Investment managers who fail to perform on climate could soon be ditched from the People’s Partnership’s £26bn portfolio, the DC master trust released today.
Managers who fail to put in place a net zero by 2050 target and allocate adequate resources to stewardship could soon find that their relationship with The People’s Partnership will be put under review, a process which could result in divestment, the UK master trust, which manages the assets of some 6.7m members has warned.
The master trust also expects its managers to commit to the 2020 UK Stewardship code or equivalent local stewardship codes, the fund said in its latest Responsible Investment report .
Leanne Clements, head of Responsible Investment at People’s Partnership, which manages The People’s Pension, emphasised the critical timing of these changes. “With the clock ticking on urgent issues like climate change, it’s essential to be bold in our demands. We expect our fund managers to adopt a precise, theory-driven approach for maximum impact,” she stated.
Flag in the sand
In addition, The People’s Partnership has also revealed its own net zero target, having been the last of the big UK master trusts to commit to a deadline, as previously reported on Net Zero Investor.
The fund has put its flag in the sand, pledging to be net zero by 2050, whilst also aiming to half its GHG emission intensity by 2030 across its growth assets. It also plans to cut its GHG emissions by a third until next year across its developed equity holdings.
The announcement by the People’s Partnership comes after the master trust announced earlier this year that it had shifted £15bn of its assets into climate-tilted stocks.
Due to the size of its membership, assets for the master trust are growing at more than £3bn per annum, putting it on track to remain one of the largest master trusts in the UK defined contribution market.
Strategic overhaul at the People's Pension: £15bn invested in climate-aware stocks
How are the UK's master trusts tackling the net zero challenge?
