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Environment Agency Pension Fund

PRI reporting framework 2020

You are in Strategy and Governance » Innovation

Innovation

SG 18. Innovative features of approach to RI

18.1. Indicate whether any specific features of your approach to responsible investment are particularly innovative.

18.2. Describe any specific features of your approach to responsible investment that you believe are particularly innovative.

We were one of the first funds that had an aim to align their portfolio with the Paris Agreement and set decarbonisation targets.

As part of this we have really stretching targets on investing in sustainable assets and at 39% of our portfolio, we don’t know of any other Fund that can match that in the world.  Of course, the methodology is all important.  We publish in our annual accounts how we do this.  With the introduction of common taxonomies, we will be able to compare ourselves more readily and increase awareness and involvements of other funds.

We are also proud of our role in setting up the Transition Pathway Initiative which goes from strength to strength (www.TransitionPathwayInitiative.org.uk).

But there are two issues which we are working on currently which we think also sets us apart.

One is our members, who in their day job work to bring about a better environment. We want to harness that energy and knowledge and make them aware too that their pension fund is one of the best tools they have to tackle climate change at a global level.  We have started to engage with them more proactively and have undertaken a survey to understand what they think about responsible investment and which comms tools work best for them.  We are delighted so many people want to take part in focus groups and next year, Coronavirus – permitting, we intend to meet more face-to-face and really engage with them on this agenda.

The second issue is focusing on the management of physical risks from climate change on investments.  Again this links back to the work of our employers who are responsible for managing flood risk across England and Wales.  When we have been attending AGMs to raise the issue of climate change, we have focused on physical risks and found more often than not, we are the only ones raising this issue with the Board.


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