Standard Life completes final stage of £15bn DC asset transition into sustainable multi asset solutions

11 November 2022

• 1.5 million members invested in sustainable multi asset solutions, marks sustainable milestone for Standard Life

Standard Life, part of Phoenix Group, has completed embedding a range of responsibly invested, sustainable multi asset funds for its 1.5 million workplace pension scheme members, with assets of circa £15 billion now invested in sustainable solutions on their behalf.

The leading workplace pensions provider’s ambitious programme to introduce sustainable investment strategies designed to help employers and trustees meet their member and regulatory needs, and pension customers achieve good outcomes, has been completed two months earlier than the end of year timeline previously announced in January 2022.

The programme was executed in a number of distinct phases starting with the adoption of a sustainable multi asset solution for 87,000 members of the Standard Life Master Trust in February 2022, followed by the transition of 1.2 million members in the Active Plus and Passive Plus III Growth Pension Fund, and £11.4 billion in assets, to a sustainable multi asset responsible investment solution.

The programme successfully concluded in October when circa 200,000 members invested in Active Plus and Passive Plus I, II, IV, and V fund ranges switched into responsible investment solutions. This completed the strategy to establish responsibly invested, multi-asset funds as the defined contribution (DC) default solution for existing pension savers.

Similar sustainable solutions were introduced for new members in 2020.

Gail Izat, Workplace Managing Director, Standard Life, part of Phoenix Group said: “We set out to offer an outcomes-based, future proofed responsible investment proposition not just for new joiners to workplace schemes but for those who have been loyally saving with us for many years too. It’s been a massive undertaking to successfully implement the switch of over 1.5 million existing members and transfer £15 billion in assets to our sustainable multi asset investment solutions.

“Our members tell us they want to balance growth and risk while protecting the environment and avoiding harm through their investment choice. Our sustainable multi asset solutions help them do this, knowing we’re investing their money responsibly.”

Recent insight from Standard Life shows that 88% of customers see growth and risk management of their pension savings as a priority, while 84% want to avoid harm with their investments. When it comes to protecting the environment, 90% said that was important too.

With the aim of accelerating investment growth in the early years, Standard Life has increased the responsible investing content of the growth fund in its Sustainable Multi Asset Universal Strategic Lifestyle Profile which integrates clear Environmental, Social and Governance (ESG) targets designed to manage pension growth through positive outcomes.

These include a 50% reduction in carbon emissions, screening out of controversial weapons, tobacco production, thermal coal and unconventional oil and gas, while also driving positive change through increased stewardship and the expertise of a dedicated team of ESG stewardship and investment specialists. The Fund’s increased equity exposure, targeting good customer outcomes, is underpinned by ESG components of up to 79%, with an ambition to extend it further by the end of the year.

Source: Standard Life