Corporate pension funds are a hidden force in green investing

When we worked on the Live 8 Make Poverty History campaign [سلسلة من الحفلات الموسيقية الخيرية]We tried to meet with a group of business leaders. As I recall, the meeting was arranged for a long time, and when it finally took place, ten people in uniform appeared. Things were not going well. They saw us as dangerous communists with party cards and could not understand what the campaign had to do with them.

But that all changed. Over the past 20 years, more and more companies have recognized the power of business to do good. By putting the planet and its people at the center of their business, companies have shown that you can pursue a cause without it getting in the way of making a profit.

But one thing is strange: very few of them have thought about taking advantage of one of the most powerful tools in their arsenal, the company pension fund.

It surprises me and you that I am writing about pensions. I didn’t think about my retirement until recently, because I imagined it at Gringotts [بنك السحرة في حكايات هاري بوتر] It accumulates slowly because of the benefits it acquires through some financial alchemy [الإجراءات المالية]And I hoped it wouldn’t bother me so much the whole time.

But when I looked into it, I discovered that our pensions have extraordinary potential, not only to generate generous returns, but also to build a healthy planet.

The total value of UK pensions is £3 trillion (yes trillion) ($3.6 trillion), and research suggests that moving your pension out of an “automatic” fund, which is where most of our pensions go, into a greener structure is more efficient. 21 times less in reducing carbon emissions than in stopping air travel, changing energy sources and eating plant-based food, all combined.

But even though pensions have such power that there is so much money that can be invested in making the world safer and greener, companies are not taking advantage of that power. 95 out of 100 companies in the FTSE index have glowing sustainability plans, but only five of them mention pensions, despite the fact that financial firms supply the pension fund with 20 billion pounds ($24.1 billion) a year under their schemes.

And that’s a huge amount of money that could be invested in renewable energy, affordable housing, and great startups that are friendly to the planet. However, this amount is often invested in projects related to fossil fuels, cigarettes, weapons, gambling or pornography.

Having renewable energy in your office is great, and vegan food in your kitchen helps. But why would any company take these steps and let their pensions ruin all their hard work behind the scenes?

Anyone who thinks pensions are unimportant should think again. We launched the Make My Money Matter campaign [حملة مستقلة لترشيد استثمارات الرواتب التقاعدية] Look at the carbon footprint of Vesti 100 companies and compare it to the financial footprint of their pensions. And the results were amazing.

The carbon emissions financed by pensions are seven times higher than the emissions of the companies that own them. This means that for every tonne of carbon your company produces, your company pension could be responsible for funding seven times those emissions.

So what can we do about it? Well, first, let’s talk about it as much as possible. If you’re reading this, check your retirement situation. And let everyone ask themselves: Where is my money invested and what effect does it have?

I finally met the wonderful Deborah Maiden from the BBC’s Dragon’s Den, and was intrigued to discover that she has almost as much passion for green pensions as I do, and she believes this debate is great and necessary.

According to Deborah, “Because of the prevalence of greenwashing [الادعاءات الكاذبة لشركة ما حول تأثيرها الإيجابي على البيئة] In industries around the world, companies risk inadvertently undermining the good work they may have been doing in order to continue operating in a more sustainable manner. I know firsthand that companies now see sustainability as an essential part of their business and recognize their responsibility to save our planet. However, I also see companies that claim to be environmentally friendly, but their claims don’t always stand up to scrutiny.”

“Whether intentional or not, companies’ sustainability work can be lost by damaging investments in their pension systems, and they should not ignore this great opportunity to become true climate leaders.”

Effective use of pensions will not only help companies fight the climate crisis, but can also inspire and engage their employees, many of whom are more determined than ever to make their money work. A staggering 72 percent of employees now want their company to invest their pensions in a sustainable way. I’m surprised that the percentage is so low, because I don’t understand why a young person entering a company doesn’t say, “Oh, of course I want a sustainable pension.”

So if you want to play your part in… [معالجة] Climate crisis, it’s time to think about your pension. Join 100 other companies, from Octopus to EY, Tesco and IKEA, who have all signed up to the Green Pension Pact Make My Money Work, which means they are aligning their pay systems. Pensions have one of their sustainability strategies.

Mark Cudigan, CEO of Ella’s Kitchen, one of our charter signatories, says: “Pensions aren’t the first thing you think of when you’re trying to make a positive impact. But if there’s one simple thing, just one, we can do to move to a zero-emissions world [كربونية] It will be about looking at where our money is invested and making sure it is invested in companies that are aligned with our values.”

With our guidance, we help them invest their money in a way that serves the values ​​they stand for and involve our employees and customers in the entire process.

In the end, there is a simple emotional logic behind everything, which is that pensions are the way we ensure a secure and comfortable future. It would be crazy if our pensions actually got us to retirement in a world on fire. Now is the time to move to sustainable pensions, because we are all starting to smell the smoke [تصاعد الخطر المحدق بنا جراء أزمة المناخ].

Over the past 20 years, companies have embraced the potential for sustainability, for people and the planet, as well as for increasing profits. But now the next step is to make our money work. Because if you are going to work to preserve the environment, it is high time that your pension should also be in that direction.

Richard Curtis CBE is a film director, producer and screenwriter and founder of the Make My Money Matter campaign.