Could a social pension product help engage DC savers?

Jeremy Rogers, Chief Investment Officer of Big Society Capital discusses a product that doesn't yet exist but there is increasing demand for, a Social Pension.

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Last week I was invited to join a panel at Legal & General’s Defined Contribution (DC) pensions conference, chaired by Simon Chinnery, exploring the future direction of DC pensions.  My fellow panellists had innovative products that were available to DC savers now.  The Legal & General Future World Fund uses factor and climate change weighting to provide an index portfolio targeted around the low carbon economy.  The Partners Group Generation Fund makes the potential excess returns of private equity available to DC savers for the first time.

I was asked to speak on a product that doesn’t yet exist, but we see increasing demand for, a Social Pension. Recent surveys by Barclays and Ethex have suggested over half of savers are interested in having investments that create positive social impact. In France they have developed “Fonds Solidaires”, which target social projects and have raised Eur 7bn from over a million savers.

We are exploring with Legal and General whether it is possible to develop a similar product for UK DC Pension savers. Legal and General has a longstanding interest in driving positive investment in the UK. The organisation I work for, Big Society Capital, has committed over £1bn to social investments in the UK so far, alongside a number of institutional co-investors...

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