‘Relative silence’ from pension funds on sustainable finance policy
‘Disengaged’ European pension funds are leaving discussions on climate policy to their national associations many of which are highly resistant to the EU’s sustainable finance proposals.
Many European pension funds have a “blind spot” when it comes to sustainable finance policy and are not actively engaged on the issue, according to new research by thinktank InfluenceMap.
This “relative silence” from funds on climate-related financial policy development is being filled by pension industry associations, the research suggests. Some of these associations – particularly those with a higher proportion of corporate fund members – have strongly resisted the EU’s sustainable finance proposals.
The analysis covered 25 of Europe’s largest pension funds, with total assets exceeding $3.4trn. It also reviewed the policy engagement of ten national pension fund associations, as well as PensionsEurope, which represents the industry at EU level.
InfluenceMap found that only four out of the 25 funds and five of the ten national associations had shown “meaningful engagement” with sustainable finance policy.
Paula Castro, InfluenceMap’s senior analyst, said that most of Europe’ pension funds were “not actively engaged on emerging sustainable finance policy”.
She added: “This points to a potential blind spot for the industry. It means that industry associations – which often take a more negative approach to policy – are the loudest voices at an EU level. Given the enormous amount of money invested in pension funds, these organisations have significant influence when it comes to pulling levers to address the climate crisis.”
Norway’s Norges Bank Investment Management, the Dutch fund Pensioenfonds Metaal en Techniek, and UK-based funds, the Universities Superannuation Scheme and the BT Pension Scheme, are highlighted as positive advocates for ambitious sustainable finance policies.
Among the associations, the UK’s Pensions and Lifetime Savings Association is considered the most supportive.
Industry associations – which often take a more negative approach to policy – are the loudest voices at EU level. These organisations have significant influence when it comes to pulling levers to address the climate crisis.
Negative engagement
According to the InfluenceMap research, some national pension industry associations appear “highly resistant to ambitious sustainable finance policy”. Germany’s aba and Belgium’s PensioPlus are identified as having “particularly negative engagement”.
Both associations have a higher proportion of corporate pension fund members than the other association analysed. Aba and PensioPlus have opposed the EU’s Sustainable Finance Disclosure Regulation, while aba has also not been supportive of the EU taxonomy.
PensionsEurope, which has 25 member associations in 18 EU member states and four other European countries, is said to have communicated high-level support for many sustainable finance policies. However, it has “cautioned against a prescriptive approach to regulatory intervention”.
