Lothian Pension Fund (LPF), the second largest local Government Pension Scheme provider in Scotland, has launched a new Climate Change Policy. This new policy enhances and extends LPF’s approach to climate change and details their climate change commitments and ambitions:
1. To support the goal of transitioning the real economy to net zero greenhouse gas emissions by 2050
2. To promote a managed decline for the fossil fuel sector – introducing a presumption against continued investment in laggard oil and gas companies
3. To report annually in line with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD)
4. To develop a climate action plan – to support the resilience of their investment strategy to climate change.
Emmanuel Bocquet, Chief Investment Officer, LPF talks about the new Climate Change policy:
“The new Climate Change Policy achieves the right balance between implementing our commitments on climate and ensuring we maintain an appropriately unconstrained investment universe to deliver the required risk-adjusted investment returns over the long term for our employers and members.
“Introducing a presumption against holding shares in laggard oil and gas companies increases our scrutiny of the overall sector and helps us identify and encourage those firms we view as better aligned with our goals”.
Gillian de Candole, Head of Responsible Investment, provides insight into climate transition and engagement:
“Climate change is a systemic issue presenting financially material investment risks and is therefore a stewardship priority for us. Our new Climate Change Policy sets out the actions we’re taking to enhance the resilience of our investment strategy, as well as how we support the real-world transition to net zero, recognising that this requires a significant change in the shape and structure of the global economy, including a shift away from fossil fuels.”
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