UK Pension Funds Will Now Be Able to Take a Greener Approach to Investing
A new government directive will allow trustees of pension funds to push for green investment of trust money. The managers of the money invested in Britain’s workplace pension schemes, the total of which sits at around £1.5 trillion, will be able to drop shares in oil, gas and coal companies as part of the new initiative. Instead of these investments in traditional energy sources, the managers will be given powers to invest long-term in green and social impact opportunities. The proposals from the government are specifically designed in order to enable trustees to divest from any companies that are environmentally damaging and to redirect their cash into green alternatives. Up until this point, trustees have felt like their hands have been tied by their fiduciary duties. This duty requires trustees to seek the best returns possible for their beneficiaries, regardless of the ethics of the prospective investment opportunity. Although these new rules are complex for the laym...