Pension funds ‘must consider risks of climate change’

Pension fund trustees have a duty to address the financial risk posed by climate change when making investment decisions, according to a report issued today by the Carbon Trust, the government-funded body that helps companies cut harmful emissions.

The report, compiled by Mercer Investment Consulting, warns that the effects of climate change have already had an impact on companies’ costs, revenues, assets and liabilities. The average UK pension fund holds around 70 per cent of its assets in shares of listed companies, so any impact from climate change on the underlying performance of UK corporates could have a severe effect on the value of the fund.

The Telegraph