Over 1.5m members and circa £15bn in responsibly invested funds

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We now have over 1.5 million members and circa £15 billion of assets in our responsibly invested, Sustainable Multi Asset investment solutions

In April, I shared an update with you on where we were with our plans to extend our Sustainable Multi Asset investment solutions to existing members currently invested in our Active and Passive Plus range. I’m pleased to share details with you on how we’ve now achieved this.

Our responsible investment solutions are focused on member needs

Our recent customer insight* shows that 88% see growth of their pension savings as a priority, 81% still consider risk management important and 84% want to avoid harm with their investments. When it comes to protecting the environment, 90% said that was important too. This builds on our previous insight that led us to design an outcomes-based, future proofed, responsible investment proposition with our Sustainable Multi Asset investment solutions – to help members, existing and new, try to achieve their retirement outcomes, knowing we’re investing their money more responsibly.

Our Sustainable Multi Asset investment solutions use a blended Environmental, Social and Governance (ESG) approach, including:

• Avoiding investing in companies that could present a risk, by screening out certain types of stocks, like those involved in controversial weapons or tobacco production.
• Investing more in companies that could provide an opportunity, by positive tilting towards those focused on carbon reduction and green technology.
• Engaging with companies to understand all the risks and opportunities they present, to help promote their long-term success through stewardship.

We increased the responsible investing content of our Sustainable Multi Asset Growth Pension Fund earlier this year to 79%, with plans to increase this to 82% in the future. It’s also worth noting that our Sustainable Multi Asset investment solutions are constantly monitored through layered, rigorous and independent governance.

Our progress this year

Starting with Master Trust

Our first major achievement was in Q1, when after working closely with the independent Standard Life Master Trust Committee we successfully switched over 87,000 members and just under £1 billion of assets, from our DC Master Trust Active and Passive Plus III and IV solutions into our Sustainable Multi Asset Universal Strategic Lifestyle Profile.

Evolution of Active and Passive Plus III default solutions

Following the Master Trust exercise, we’re pleased to confirm that the transition of the Active and Passive Plus III Growth Pension Fund is also complete, with around 1.2m of our members and £11.4 billion of assets invested in a responsible investment solution. We’ve made sustainability changes to the Pre and At Retirement Funds too, with further updates to be made over the coming months.

This is a great achievement, which began in December 2021, when we wrote to over 1.2m members (both current members and leavers of workplace schemes) to let them know that our Active and Passive Plus III solutions would be evolving to investment solutions managed in a responsible way, including our Sustainable Multi Asset investment solutions. This was followed by a detailed, robust and successful transition process to smoothly invest these members in responsible investment solutions.

Switching members from Active and Passive Plus I, II, IV and V to responsible investment solutions

Making responsible investing more available

October has been busy in terms of switching members to responsible investments, and we completed the switch of members invested in our Active and Passive Plus I, II, IV and V range to our responsible investment solutions, which means a further 100,000 and £1.9bn of assets being in responsibly invested solutions. We communicated the switch with these members earlier this year, providing detailed information on the changes.

This final exercise means we have circa £15 billion of assets and over 1.5m members fully invested in responsible investment solutions.

Members invested in our Active and Passive Plus ranges will continue to benefit from reduced charges, or no change to charges following our annual management charge (AMC) reduction earlier this year – more information on this can be found here.

Award-winning

Finally, we were delighted that our strategy to change members to responsible investment solutions won the ‘ESG initiative of the year (for corporates)’ at Environmental Finance’s Sustainable Investment Awards 2022 .  We’re proud to be recognised for the progress we’ve made in moving members into our responsible investment solutions.

You can find out more about our Sustainable Multi Asset investment solutions here.

*Standard Life Customer Responsible Investing Research Report Q1 2022

The value of employees’ investments can go down as well as up, and they may get back less than they paid in.