Royal London says “This is not the time to be passive” as it embeds responsible investment in pension funds

16 August 2021

Royal London is further embedding responsible investment across its propositions through the introduction of ‘tilts’ to its £23bn passive equity funds – including in its flagship ‘Governed Range’.

As a result, the carbon intensity of the equity investment in the ‘Governed Range’, which has around 1.25m customers’ pensions invested in it, is expected to reduce by more than 10%. This further strengthens Royal London’s approach to responsible investment and is part of its commitment to protecting standards of living for this and future generations, at no extra charge to customers.

The ‘tilted’ equity funds will increase holdings of companies with good Environmental, Social and Corporate Governance (ESG) practices and reduce holdings in companies with poorer practices. These adjustments will be implemented to improve the ESG profile of the funds, without significantly impacting risk or returns.

Julie Scott, Royal London’s Chief Commercial Officer, said:

“This is not the time to be passive on ESG. The introduction of these ‘tilts’ to our pension range is part of investing our customers’ money responsibly to make a positive difference to the planet. We will also continue to engage with companies to promote positive change.

“We are committed to making investing responsibly easy. That’s why we are making this enhancement to our default pension fund range, with no extra charge to our customers.”

In June, Royal London outlined its climate commitments to:

• Achieve Net Zero across its investment portfolio by 2050.
• Reduce its carbon equivalent emissions from the investment portfolio by 50% by 2030, while also developing climate solutions that enable customers to invest in the low carbon transition.
• Achieve Net Zero direct operational emissions by 2030.

Source: Royal London