Where next for ESG? – An evolving approach for trustees

Read our 2020 guide, ‘ESG and climate change for pension funds’ here

Environmental, Social and corporate Governance (ESG), has been one of a number of issues vying for trustee attention in the last few years, often with limited success.  Now, however, it seems that consideration of the impact of ESG factors on long-term financial risk is set to gain the weight of legislation behind it, with the DWP consultation launched in June 2018 seeking to clarify ESG fiduciary duties in the Occupational Pension Schemes (Investment) Regulations 2005.  It is expected that reforms will also extend to contract-based pension schemes.

The time has come therefore for trustees’ to really think about their desired approach for ESG and how to incorporate sustainability and other financially material factors into their investment process.  For example, it is likely that schemes’ will need to update their Statement of Investment Principles (SIP) to demonstrate compliance with their legal duties on evaluating long-term investment risk.

This, our second guide on ESG, provides an overview and update of key developments and trustees’ legal obligations in this area and focuses in particular on:

  • Unpicking the fiduciary duty and applying it to common ESG approaches
  • Navigating the bewildering number of acronyms, jargon and organisations involved in ESG
  • What’s coming up on the agenda for trustees in the next 12 months
  • Next steps – practical actions for trustees wishing to advance ESG in their schemes

Read the guide – Where next for ESG?

Use this link to download a printable version of the guide.

Read our first guide for trustees – A practical approach to ESG here