More than £150million in pension funds to be invested in climate-aware fund

A Suffolk council has agreed first pension investments into climate-aware companies

More than £150million in pension funds at a Suffolk council are to be put into a dedicated pot investing in climate-aware companies, it has emerged.

Suffolk County Council’s pension fund committee last week agreed the transfer into a UBS Climate Aware World Equity Fund, which effectively aims to produce similar returns to existing investments but into companies with lower carbon emissions.

The money has come out of the council’s £2.9billion passive equity investments fund – investments which are held long term to reduce fees associated with frequent buying and selling. It marks the authority’s first steps into a portfolio recognising reduced carbon emissions, following the council’s decision to declare a climate emergency in the spring.

Pension fund committee member Robert Lindsay has been campaigning for more environmentally-friendly investments, and said that he is delighted the committee has taken this first step into moving money away from the fossil fuel industry.

Lindsay said that this is the first action the county has taken in this direction since they declared a climate emergency four months ago and he believes it is the first acknowledgement by Suffolk pension committee that there is need to take account of the climate crisis in the way they invest the money, so it is a very significant principle that has been established.

In financial terms this a relatively baby step, but he hopes that they will move more of the fund into low carbon before the end of the year and that quite soon, the whole fund can be de-carbonised, he said.

Lindsay said they were very careful to check that taking this step would not significantly affect performance of the fund.

Extinction Rebellion, which earlier in the month gave a demonstration outside the council’s base at Endeavour House, Ipswich, has already called for investments in fossil fuel firms to be withdrawn and a carbon-friendly pot to be established instead.

As of March this year, the council’s largest single-company investment of pension funds was in Royal Dutch Shell, with that fund at £23.6m.

Conservative councillor Andrew Reid said that the Suffolk pension fund is committed to investing in environmentally aware investments that produce sustainable returns that are not detrimental to the committee’s fiduciary duty.

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