The Trustee of the First Bus Retirement Savings Plan (the Plan) recently published its Implementation Statement for the year to 5 April 2025. The document outlines how the Trustee’s investment policies, including those on exercising rights and engagement activities, have been followed.
Self-Select Fund Range Expanded with ESG Focus
For the fiscal year ending 2025, the Trustee reviewed the appropriateness of the self-select fund range offered to the Plan’s membership. The Trustee concluded that a change was needed and implemented a new wider range of funds in March 2025. The new funds include a wider range of ESG integrated funds, offering individual members the opportunity to invest in a more (or less) ESG-focused way than the Trustee deems suitable via the default. In selecting the new fund range, the Trustee, Aegon, and its investment advisor considered the ESG and engagement credentials of the funds. The Trustee was satisfied that the new funds engage with underlying companies in line with its own policies. All funds within the existing self-select range offered by Aegon and the Trustee (except for the UK Bus Shariah Global Equity Fund and the LifePath range of funds) were closed, and the money in which members had invested in these funds (and the future contributions to them) were moved. (Source: Implementation Statement, page 3, 5-6)
Default Investment Strategy Adjustments Planned
For the fiscal year ending 2025, the Trustee was made aware of changes Aegon plans to make to the LifePath default in which members invest. These changes include a shortening of the glidepath (period of time in which members de-risk prior to targeted retirement age) and a change to the structure of the default to provide greater flexibility for future changes. These changes will be made during 2025, after the accounting period end. (Source: Implementation Statement, page 5)
Ongoing Engagement with BlackRock on Stewardship Alignment
The Trustee observed that a notable proportion of significant climate votes made by BlackRock, an underlying fund manager used by Aegon, did not completely align with the Plan’s communicated priorities. The Trustee communicated this observation to Aegon, who provided a statement indicating ongoing engagement with BlackRock’s senior management on multiple occasions to understand their level of alignment with Aegon’s Expression of Wish (EoW) voting approach. Aegon stated that they continue to closely monitor BlackRock’s voting activity through an expanded EoW approach for 2024, with a wider subset of companies and monitoring alignment against detailed voting guidelines. Aegon also welcomed the publication of BlackRock’s new decarbonisation stewardship policy, to which they contributed, expecting it to further align BlackRock’s voting with their climate expectations from Q4 2024. The Trustee was satisfied that Aegon’s stewardship priorities were broadly aligned with their own and was reassured by the progress made and expected further improvements. (Source: Implementation Statement, page 3-4)
Climate Emissions Monitoring to be Implemented
The Trustee has asked its investment advisor to assist with providing climate emissions monitoring of the investments. This annual review will help the Trustee to understand the impact of the investments for an average member and the improvements Aegon is able to make year on year to the scale of emissions. The Trustee had not received this review prior to the date of this Implementation Statement. (Source: Implementation Statement, page 3, 8)
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