UK pension funds in the limelight because of massive investments in fossil fuel firms

Thursday, June 29th 2023 - 02:25 UTC

Full article

Make My Money Matter revealed that UK’s pension funds should review their £88 billion worth of investment in equities and bonds of fossil fuel firms

Controversy in the UK over pension funds and London's commitment to keep to the Paris Agreement goals. In effect this Wednesday, the climate finance campaign Make My Money Matter revealed that UK’s pension funds should review their US$ $112 billion (£88 billion) worth of investment in equities and bonds of fossil fuel firms, as the funds are not anywhere near on track for aligning their portfolios to the Paris Agreement goals.

The pension funds’ holdings in oil and gas are almost ten times higher in value than the holdings in listed FTSE 350 clean energy stocks, according to the research cited by Bloomberg.

“As a result, we believe that ongoing investments in fossil fuel companies by the UK pensions industry – without a serious, time-bound and co0ordinated escalation in how investors use their stewardship role – represents a ticking time bomb for both our pensions and the planet,” the authors of the report say.

According to Make My Money Matter, US$ 3,816 (£3,000) per pension holder in the UK is invested in fossil fuel companies. The campaigners at Make My Money Matter call on the UK’s pension funds to engage with the fossil fuel companies to commit to no expansion of oil and gas production—a policy in line with a 1.5 degrees Celsius trajectory.
However, the UK-based super-majors, BP and Shell, have recently doubled down on oil and gas to ensure energy supply after the recent energy and energy security crises.

Shortly after Shell unveiled on June 14 its new strategy to continue investing in oil and gas production and selectively pour capital into renewable energy solutions, the Church Commissioners for England said last week the Church of England was dumping all remaining oil and gas majors from its portfolio for failing to align with the 1.5 degrees Celsius pathway.

The church has less than 1% invested in oil and gas from the endowment fund, while its US$ 4.1 billion (£3.2 billion) pension scheme includes around US$ 8.9 million (£7 million) invested in oil and gas firms, according to Financial Times estimates