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At Standard Life, responsible investing is first and foremost about helping you to achieve your retirement goals. Our priority is always to aim to give you a good financial outcome in the long term. At the same time, we’ll look at other factors we know you might want and expect us to look out for on your behalf.
What is responsible investing?
Responsible investing means considering environmental, social and governance (ESG) factors when deciding where to invest money. At a high level, it’s looking at how a company is managing ESG risks and opportunities and how that could affect its performance over the long term.
Why does this matter? We believe it can lead to better financial outcomes for our customers and may help to support wider change.
How prepared a company is as we move to a low-carbon future; are they at risk of financial loss, or perhaps they’re in a growing sector of the future. Also, how environmental factors such as climate change affect a company’s ability to operate. This could include flood risk or resource scarcity. On the flipside, how a company is impacting the environment – for instance, its energy usage, waste disposal, land development and carbon footprint.
A company’s relationship with its employees, suppliers and the community where it operates. Examples include labour practices, human rights, employee wellbeing, health schemes for staff and supplier relationships.
A company’s management and processes. These include who’s running the company, how the company and its finances are managed, and how it approaches salaries and strategy.
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How a company manages (or doesn’t manage) these areas can impact its financial performance. And, in turn, that can affect how much value it could add or remove to your pension pot.
That's why investment managers may consider ESG risks and opportunities when they decide where to invest your pension money – and to encourage companies to maintain high ESG standards going forward (known as stewardship).
Plus, encouraging better consideration of ESG risks and opportunities to aim to improve financial outcomes, may also help to drive positive change in the wider world.
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Find out how ESG factors can impact your pension investments
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The world of responsible investing is full of jargon. Here are some common terms made simple
Investing responsibly with Standard Life
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As part of Phoenix Group, we’re on a journey to becoming net zero by 2050. Find out how we’ll continue to support a better financial future for our customers, while considering our investment in carbon-emitting sectors, in our Net Zero Transition Plan. Standard Life is part of Phoenix Group and the data shown is for the combined Phoenix Group.