Smart Pension, one of the UK’s leading workplace pension providers, has announced that its default growth fund will be net zero by 2040, and will have halved its emissions between 2019 and 2025. This is well ahead of the goals of the Paris Agreement, which called for emissions to be reduced by 45% by 2030 and to reach net zero by 2050.
Much of Smart Pension’s default growth fund is already invested in companies with a strong focus on ESG. Going forwards the fund will invest even more into companies which are innovating for good. This includes those working to improve energy efficiency, transition from fossil fuels, create sustainable agriculture, and reuse materials. Smart Pension, which manages more than £2bn in assets on behalf of more than 900,000 UK savers, will also give members an increased choice of investments based on how sustainable they want their pension to be.
The announcement follows the company’s recent move to one of the first all-electric buildings in London’s West End, powered entirely from renewable sources and operationally net zero from day one.
A sustainability hub has been launched on Smart Pension’s website providing full details of its journey towards net zero.
Smart Pension credits its ultra-efficient technology platform, developed by Smart, as enabling it to provide an affordable offering to employers and members, allowing it to make more sustainable investments which benefit people and the planet. Smart’s technology uses AI and guided navigation tools to make retirement savings straightforward and accessible to all. Smart is backed by J.P. Morgan, Barclays, Legal & General Investment Management, Natixis, Chrysalis Investments and others.
Paul Bucksey, Managing Director at Smart Pension commented:
“Although sustainable investments can be more expensive than more traditional investments, a key advantage of having a very clean and efficient platform is that we can keep our admin costs low, allowing us to spend more on higher-quality, ESG-friendly investments without increasing member charges.
“With the success of industry action groups such as Make My Money Matter, and from our own research, we know that our members are increasingly looking at what their pensions savings are doing as they accumulate. Smart Pension is leading the pack with more of our assets invested in sustainable funds than ever before, and with us providing savers with the opportunity to invest in even more sustainable funds.
James Lawrence, Head of Investment Proposition at Smart Pension added:
“We believe that Smart Pension is well ahead of its industry competitors when it comes to sustainable investing. We're always reviewing our investments and looking to the future at how we can commit even more to innovative sustainable funds that benefit society and the environment, whilst also providing strong outcomes for our members.”
Launched in 2015, Smart Pension exceeds £4bn in assets under management (AUM) and now serves over one million members and more than 70,000 employers. It is powered by Keystone, Smart’s global savings and investments technology platform.
Aquiline Capital Partners, Barclays, Chrysalis Investments, DWS Group, Fidelity International Strategic Ventures, J.P. Morgan, Legal & General Investment Management, Link Group and Natixis Investment Managers are all investors in Smart Pension.