The trustee of the UK’s Universities Superannuation Scheme Ltd (USS) has added intermediate climate targets for its investment portfolio for the next decade to its existing, comprehensive goal of achieving net zero funded emissions by 2050.
Announcing yesterday’s boost targets, USS said it plans to work with companies in its investment portfolio to reduce the emissions they generate by 25 percent by 2025 and grow to 50 percent by 2030 based on measuring total CO2 by 1 billion-dollar assets under management.
Tony Burdon, CEO of Make My Money Matter (MMMM) – a company that insists on a cleaner pension sector in the UK – last week pointed to the USS as one of several old pay-as-you-go (DB) schemes that “didn’t work,” and MMMM also last month wrote to the USS calling for action.
One of the actions in support of the intermediate goals outlined today is a new mandate for sustainable growth of £ 500 million, which, according to the USS, will be invested worldwide – directly or through funds – in high-growth private enterprises who develop technologies and services that contribute to decarbonisation efforts.
The USS said the mandate would complement the existing renewable energy strategy, which includes 1.2 billion pounds deployed in wind farms and green technologies.
The mandate of sustainable growth is planned to be managed internally, which, according to the firm, will be beneficial currently heavy database schemas. Over time, the mandate will also apply to segments of the defined contribution scheme.
These announcements of intermediate goals appear after the USS confirmed last month that it would transfer £ 5 billion AUM from companies that pollute the environment in developed markets.
“Climate change and a new investment mandate are part of a much larger plan that will include all of our investment professionals and the management teams of our portfolio companies,” said USS Group CEO Bill Galvin. “We hope these announcements give confidence to our members and other stakeholders in the seriousness with which we treat decarbonisation.”
Galvin added that decarbonisation was a “difficult task”, noting data quality issues that he said the USS shares with many schemes across the industry.
“But these goals are a statement of intent and give us important milestones by which to assess our progress,” he continued. “We will need to work closely with our industry colleagues, regulators, governments and many others. Ultimately, we all need to work together to reach pure zero.”
A version of this article originally appeared on Occupational pensions.
https://www.businessgreen.com/news/4044924/uss-outlines-interim-climate-goals-pension-portfolio-eyes-2050-net-zero-target The USS outlines intermediate climate targets for the retirement portfolio, as it expects a zero net target by 2050