THE FUTURE OF INVESTING IN 3D – RISK, RETURN AND IMPACT
We're all actors in a financial system that impacts people and the planet in which we live. Pensions are one of those actors, tied to, dependent on and with the ability to change that system when the levers are well understood and used.
At this Pensions for Purpose Annual Symposium, we will go further than we have gone before in unpacking the current and future potential for governance, social and environmental impact integration.
We will look at best practice, debate the opportunities and challenges for climate and productive finance, and, through roundtable discussions, get views from our asset owner and adviser audience on what they need to go from disclosing to acting on impact.
Overcoming implementation challenges roundtable
At our recent Annual Symposium, our Senior Director & Community Lead, Richard Giles, opened a session on the challenges of implementing social and environmental impact, leading to table discussions on the complexity and variety of impact investing. Participants broadly agreed impactful investments should enhance financial returns rather than compromise them, with examples including high-return forestry projects in Paraguay and rewilding initiatives in Yorkshire, which are profitable and impactful.
The discussions highlighted the importance of viewing positive and negative impact holistically aiming to deliver net-positive effects across portfolios, while being aware of unintended consequences. Participants pointed out a renewable energy company, for instance, may struggle with governance issues, while a healthcare firm may be a high emitter with a significant carbon footprint, reaffirming the need for rigorous assessment.
Several challenges were aired, including the alignment of impact goals with fiduciary duty and the differing views among trustees, some of whom prefer low-carbon strategies, while others prioritise financial returns. Asset owners also face problems with transparency, definitions and effective impact reporting. Notably, there was a call for improved training to help trustees assess and understand impact investing strategies.
Operational difficulties like regulatory requirements and liquidity issues in defined contribution pensions were also mentioned. However, examples of impactful investment strategies were shared, including SDG-focused loans, social housing, and regenerative agriculture, with scalability remaining a challenge, particularly for pension trustees. To ensure credibility, participants agreed on the need for robust impact measurement and reporting with key performance indicators to ensure the credibility of impact investing.
Place-based impact investment roundtable
At our recent Annual Symposium, our Founder Karen Shackleton, led a discussion on place-based impact investing (PBII), sparking table discussions around its opportunities and challenges for local government pension scheme (LGPS) funds. Moderators captured the main points, highlighting how PBII could unlock unique local assets like leisure centres and cemeteries rarely included in pension fund portfolios. The definition of ‘place’ varied among asset owners, with some focusing on specific UK regions and others adopting broader UK, European, or global strategies.
Challenges included limited access to local assets and the need for supportive government policies to support this type of impact investing, which can be difficult to implement. Participants suggested targeted, sector-specific investment options, similar to GLIL Infrastructure (a collaboration between aligned and like-minded investors seeking investment into core infrastructure opportunities), to target areas like social housing and natural capital.
When scaling, larger asset managers often miss the mark on delivering deep-impact solutions, particularly for regions such as South London, where improving health outcomes is a priority. Smaller, more localised strategies could better address these needs but are often unavailable due to the dominance of large-scale investment models.
Discussions also touched on the need to combine place-based investing with systemic risks like climate change, with opportunities cited in solar green farms and natural capital regeneration. Blending funds and collaboration between local authorities could help to de-risk and support such projects. However, participants acknowledged the trade-offs between profitability and impact, with a cautious approach to avoiding concentrated local investments, while recognising the significant opportunities in regeneration and natural capital that are underused.
Discover our Award winners!
We presented Content Awards across five categories.
Our winners were:
Highly commended certificates were awarded to:
Thanks again to our judges: Stephen Barrie of the Church of England Pensions Board, William Bourne of Linchpin, Rachel Brougham of BESTrustees Limited, Nick Buckland of Kent Pension Fund, Michelle Darracott of BESTrustees Limited and TPT Retirement Solutions, Anthony Fletcher of Apex Investment Advisory, Ellie Howes of Coal Pension Trustees Services, Sian Kunert of East Sussex County Council, Matt Lomas of Guy's & St Thomas' Foundation, Nick Spencer of Milliman, who assessed the shortlisted content based on originality, educational insight, design and relevance for pension funds.
To see which organisations were nominated and to read the shortlisted articles see our pre-event brochure.
Pension Fund Awards were presented across four categories:
Judges' comments – "The report provides insightful data on impact measurement, including job creation, living wage jobs, business growth, and the geographic distribution of their investments, with a standout chart highlighting alignment with place-based impact investing. Their investments focus on meeting local needs, supporting over 16,000 existing jobs, creating 7,000 new ones, and developing 4,000 homes for vulnerable people, driving economic growth in Manchester through diverse investments."
Judges' comments – "They demonstrated great alignment with various frameworks and initiatives, including the UN SDGs and strong climate ambitions. Surrey targets a net-zero date of 2050 or sooner, using the SDGs as a framework for their responsible investment (RI) approach, and have updated their voting policy to align with their RI strategy. They transitioned their EM equity exposure from passive to active management, supporting a fair transition, and all fund managers are aligned with their RI policy, aiming for real-world impact through investments and engagement."
Highly commended certificates were awarded to:
Discover our Outstanding Community Award winner!
We presented our first Community Award this year to our Oustanding Community member.
Our winner was:
The highly commended certificates were awarded to:
Meet our Content Awards judges
Here is an overview of our Content Awards judging panel. We are grateful to the judges for giving up their time to assess content for clarity, originality, educational insight, presentation and relevance for pension funds.
Stephen Barrie of the Church of England Pensions Board,
William Bourne of Linchpin,
Rachel Brougham of BESTrustees Limited.
Nick Buckland of Kent Pension Fund,
Michelle Darracott of BESTrustees Limited and TPT Retirement Solutions,
Anthony Fletcher of Apex Investment Advisory,
Ellie Howes of Coal Pension Trustees Services,
Sian Kunert of East Sussex County Council,
Matt Lomas of Guy's & St Thomas' Foundation,
Nick Spencer of Milliman.
Our pre-event brochure includes everything you need to know about our upcoming Symposium on 8 October:Pre-event brochure – Annual Symposium & Awards 2024
Pension Fund Awards shortlist
Our Pension Fund Awards are about sharing best practice on sustainable and impact investing by pension funds. They are also about elevating investor ambitions to reach our net-zero, social and levelling-up goals.
Congratulations to all of those who have made our shortlists, across our four award categories, see below – you are demonstrating leadership and progress at the forefront of this agenda.
The first round of judging was completed by members of the Pensions for Purpose team.
Items pension schemes entered into the Pension Fund Awards were assessed on the following criteria:
Best Biodiversity Statement
Best Climate Change Policy
Best Place-Based Impact
Impact Investing Principles Adopter
The shortlisted content has now been reviewed by our respective partner and sponsor judges. Our external judges used the same assessment criteria and we are grateful for their time and support.
If you would like to hear what the shortlisted funds have been doing and what ‘good’ looks like, please join us at our Symposium & Awards on 8 October to find out who our winners are.
See shortlistsWe are delighted to announce the shortlisted articles for our annual Content Awards, which are across five award categories:Content Awards shortlists
The submissions were assessed for originality, educational insight, presentation and relevance for pension funds. On the impact categories,we focused on identifying clear evidence of positive and intentional outcomes, rather than merely addressing ESG factors.
The shortlisted content has now been sent to our external judges for review. The winners will be announced at our Annual Symposium & Awards on 8 October.
See shortlists