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The People’s Pension, the UK’s largest independent master trust, has slashed the carbon footprint of its main investment fund by over half within just 12 months.
In its annual Taskforce on Climate-Related Financial Disclosures (TCFD) report, People’s Partnership, the scheme’s provider, disclosed a 53% reduction in carbon emissions within the Global Investments Fund (up to 85% shares). Despite an £8 billion growth in assets over the year, the fund’s carbon emissions have dropped by roughly 400,000 tonnes of CO2e—equivalent to 35.3 tonnes of CO2e per £1 million invested.
This impressive reduction comes nearly eight months after the fund moved £15 billion of its £30 billion in assets into climate-conscious investment strategies, which has since grown to £18 billion. Initially expecting a 30% reduction in emissions from this shift, the new TCFD data reveals an even more substantial impact.
The report highlights three sectors—materials, Utilities, and Industrials—as responsible for over 70% of the remaining emissions from The People’s Pension’s growth assets. Notably, 40-60% of companies in these sectors have set science-based targets for emission reduction, and the fund’s investment in such companies has risen by 8% to 39%.
Aligned with the Paris Agreement, the indices guiding the fund’s equity investments target a 7% annual reduction in carbon footprint going forward.
This year’s TCFD report also includes a new focus on Nature and deeper data insights by portfolio and sector, reinforcing its role as the scheme’s leading document for Responsible Investment.
Mark Condron, Chair of The People’s Pension Trustee, said:
“This report tells a compelling story about how we use our size and influence to ensure our members’ savings are allocated and managed responsibly and reinforces our commitment to tackling climate change through investing.”
Dan Mikulskis, Chief Investment Officer at People’s Partnership, which provides The People’s Pension to 6.8 million savers, said:
“With greater size comes greater responsibility. We are committed to doing what we can to make sure the companies we invest in follow certain standards, particularly in material sectors and in our priority areas of Climate, Nature and Human Rights.”
“The TCFD report has become a useful reporting vehicle across a range of climate and Responsible Investment areas.”
“Portfolio changes are one pillar of our strategy here, the other being our stewardship approach which is driven by the scheme’s recently-published Responsible Investment Policy7”.
The TCFD report’s release coincides with the launch of The People’s Pension’s revamped Ethical Fund, now among the top ethical and sustainable investment options in the UK market.
Key upgrades to the fund include a broad range of new exclusions, notably a comprehensive ban on fossil fuels across the coal, oil, gas, and high-emission power generation sectors. Additional exclusions target industries such as weapons, alcohol, tobacco, gambling, adult entertainment, unsustainable palm oil, recreational cannabis, and private for-profit prisons.
Aligned with its strict decarbonisation goals, the Ethical Fund aims to cut its carbon intensity by at least 50% and plans to reduce it further by 10% annually.
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