However ethical our lifestyle habits are, it’s likely our pensions are still funding fossil fuels, arms manufacture and the tobacco industry. If asked, we’d probably much rather this cash was invested in healthcare and renewable energy. In fact, according to Make My Money Matter, a growing campaign advocating pensions that ‘build a better world’, ‘making your pension sustainable can be 27x more powerful at cutting your carbon footprint than giving up flying and becoming a vegan combined’.
According to Emma Douglas, Head of Defined Contribution at Legal and General Investment Management (LGIM), “Increasingly a ‘good member outcome’ isn’t just about building up as much as possible in the pot during the accumulation period, it’s also about helping members make the right decisions and giving them the right options.”
LGIM, one of Europe’s largest asset managers, last week announced a partnership with Tumelo – an impact-focused fintech firm working towards greater transparency and a more ethical investment system. LGIM will now be working with Tumelo to ensure the £1.2T of pensions it manages are developed with more than just financial return in mind.
“Our research has shown that most members don’t spend much time thinking about how their pension money is invested but once they have the opportunity to engage, they are interested in the underlying themes such as climate change, human exploitation, and fair pay”, Emma continues.