Department for Work and Pensions
Printable version

UK brings forward world-leading climate change legislation

The UK yesterday became the first major economy to push forward plans to make pension schemes mitigate against the risks of climate change.

The regulations outline how pension scheme trustees will in future be required to assess and publicly report on the risks of climate change to their investments.

It makes the UK the first major economy to have put such requirements on the statute books, and comes ahead of the COP26 summit in Glasgow in November.

Minister for Pensions Guy Opperman yesterday said:

Climate change is the number one issue of our generation, and as such, it carries a material risk to our financial investments.

These world-leading regulations we outline today ensure these risks are accounted for, and are done so with total transparency.

In a matter of just a few months, savers will be able to determine for themselves if the investment aligns with their values or if they are comfortable with how their pension could be affected by climate change.

The new regulations, subject to Parliamentary debate, will affect all authorised master trusts and schemes with £5 billion or more in assets from October 2021 onwards.

This phased approach will allow government to identify best practice and - subject to consultation – extend the measures to smaller schemes as soon as 2024.

Coupled with our ongoing work on “illiquid” investments, these climate measures will enable us to mitigate against the dangers of climate change while also grasping the opportunities available as we transition to net-zero.

Further information

  • The legislation will be debated in Parliament in the coming months
  • This is part of the UK’s commitment to be the first G20 country to make Taskforce for Climate-Related Financial Disclosures (TCFD) mandatory across the economy.
  • The TCFD is an industry-led initiative which has developed recommendations on how to assess and disclose climate risk that have fast become the industry standard. The TCFD recommendations are supported by more than 1,440 organisations, representing a market capitalisation of over $12.6 trillion.

Contact Press Office

Media enquiries for this press release – 0115 965 8781

Press Office

Caxton House
Tothill Street
London
SW1H 9NA

Telephone: 0115 965 8781

Follow DWP on:

 

Channel website: https://www.gov.uk/government/organisations/department-for-work-pensions

Original article link: https://www.gov.uk/government/news/uk-brings-forward-world-leading-climate-change-legislation

Share this article

Latest News from
Department for Work and Pensions

Webinar: How local authorities can use data to better support their citizens and unlock hidden savings.