Partner Anna Copestake comments in Pensions Expert on local authority funds and pools’ effect on ESG assessment processes
At a meeting held on February 7, the council’s Superannuation Fund Committee began a major review of its environmental, social and governance (ESG) stance, including aligning investments as beliefs evolve.
Possible outcomes include the introduction of carbon footprint analysis and an appraisal of thematic opportunities. However, the fund does not plan to make any overnight changes.
Among the barriers preventing pension schemes from taking meaningful action is a lack of standardised ESG assessment processes. This means ESG ratings agencies each have their own scoring system, which can confuse asset owners.
Yet there is an increasing amount of muscle-flexing by local authority funds and pools.
Anna Copestake commented: “It’s right that they are helping lead the charge. They have asset volumes that make managers sit up and listen. They have the leverage to challenge what managers can and will do. The more that managers are made to explain their ESG capability and justify their holdings, the more difficult greenwashing becomes.”
Read Anna’s comments in Pensions Expert.
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