Natalie Jackson

The roadmap, which is suitable for private pension providers as well as local government pension schemes, provides practical steps for pension providers to start taking action now in tackling climate change.

The transition roadmap has been compiled with input from GEFI’s key partners, including abrdn, who have made climate change mitigation a “top priority”.

GEFI believes pension providers should use the power of their investments to drive change in the companies they invest in, actively engaging with investee companies and voting out directors of major polluters with no transition plans.

It argues that divestment cannot be the primary strategy as this moves the problem elsewhere, and buying carbon offsets should be a “last resort” to deal with residual greenhouse gas emissions with decarbonisation being the primary focus.

The transition roadmap includes a range of practical steps and actions pension providers can take to overcome the biggest challenges identified by GEFI research: reliable data on emissions, knowledge and expertise of pension fund staff and trustees prioritising climate change.

The roadmap also helps pension providers to navigate the plethora of tools, initiatives and frameworks that have been developed in relation to net zero.

Natalie Jackson, executive manager of the Global Ethical Finance Initiative, said: “The eyes of the world being on Glasgow at COP26 presents a great opportunity for Scottish pension providers to demonstrate leadership in taking action on climate change to ensure net zero is delivered by 2050.

“Our net zero pension workstream is a direct call to pension providers to increase emissions transparency and develop a tangible strategy to set and/or deliver on net zero commitments, and the roadmap provides a credible set of actions to enable them to do this.

“Pension providers need to start taking action to combat climate change now, before it’s too late.”