Most pension savers ‘unsure if retirement pots are environmentally friendly’

PA

More than two-thirds (68%) of pension holders do not know how sustainable their retirement pots are, research has found.

Only one in seven (13%) think it would be easy to make sure their pension is environmentally friendly, according to Scottish Widows.

Its research found sustainable investing is important to people across all age groups, with at least a third of people in each group, from 18 to 65-plus, saying having options to invest their pension only in sustainable companies matters to them.

Some 61% of people feel it is important to have clearly branded fund options which allow them to invest only in environmentally and socially responsible companies, the research found.

However, two-thirds (65%) of pension holders said they do not actively make choices about where their pension is invested.

Looking at what causes people would be interested in supporting with their pension, over half (56%) said a fund themed around clean energy and low-carbon transition would make them more interested in their pension, while 54% said the same of a “zero plastic”-themed fund.

For younger savers, easier responsible investing could have an even bigger impact, the research suggested. Two-thirds (67%) of 18 to 34-year-olds surveyed said they would invest their money in a fund focused on clean energy.

Maria Nazarova-Doyle, head of pension investments at Scottish Widows, said: “We are very aware of how environmental, social and governance factors – including a company’s exposure to climate change – can pose investment risks, and why responsible investments can be better for customer returns as well as the planet.

“They can also be attractive to savers who may not have considered how their pension is invested. If sustainable funds can encourage more people to engage with their retirement saving, then we need to find more simple and effective ways to bridge the knowledge gap to help people align their saving with their values.

“This is the next big mission for the industry and we are working hard to make responsible investing clearer and more personalised than ever before.”

A YouGov survey of more than 5,700 people and a Scottish Widows poll of more than 1,300 UK residents who are currently contributing to a pension were carried out.

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