If all UK occupational pension funds allocated 3% of assets to an ethical fund it would add £25bn to...
If all UK occupational pension funds allocated 3% of assets to an ethical fund it would add £25bn to the existing £3.3bn socially responsible investment fund market.
This was the conclusion of a survey run by the UK Social Investment Forum (UKSIF) which also argued this would have a minimal effect on fund performance.
Statements of Investment Principles were requested of 508 funds, the top 500 occupational pension funds by value, together with all local authority pension funds. The UKSIF study analysed the 171 statements provided in response.
Penny Shepherd, executive director of the UKSIF, said there were areas of surprising omissions in the statements with few mentioning any impetus for developing a SRI policy.
She said: "It is interesting how only eight of the 171 funds have chosen the relatively clear cut and easy option of segregating part of their pension fund into a socially responsible investment fund, which would allow fund managers to test the water without significantly impacting financial returns.
"In addition, only a couple of fund managers said they wanted to reflect members' concerns in regards to socially responsible investing or to take on board company policies like environmental policies or employment policies.
"Even the Universities Superannuation Scheme, which has been the subject of a significant campaign by members, did not mention this impetus."
According to the survey results, some 59% of occupational pension funds have incorporated socially responsible investment into their investment strategies either by engagement or by specific request to the fund manager.
Of those, 48% of funds, representing 69% of estimated pension assets, wanted fund managers to consider the financial impact of ethical, social and environmental issues.
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