More than one in three savers want ‘greener’ pension options – but the vast majority of consumers do not know whether their retirement savings are environmentally-friendly.
New research from Scottish Widows found nine out of 10 savers found it difficult to check how sustainable their pension was. Furthermore two-thirds (68 per cent) of those surveyed said had no idea whether their retirement savings were environmentally-friendly.
This research though found that sustainable investing was important to people regardless of gender, age and income.
At least a third (36 per cent) of people in every age group said that having options to invest their pension only in sustainable companies matters to them. Despite the rise in popularity, savers still believe it is complex and that there is a lack of guidance.
Nearly two-thirds (61 per cent) of people said it was important to have clearly branded fund options which allow them to invest only in environmentally and socially-responsible companies.
While the majority of pension savers said they do not actively make choices about where their pension is invested,over half (56 per cent) said a fund themed around clean energy and low-carbon transition would make them more interested in their pension.
A total of 54 per cent said the same of a zero-plastic themed fund.
This research shows that this trend was more pronounced among younger savers, with two-thirds (67 per cent) of 18-34 year-olds said they would invest their money in a fund focused on clean energy.
Scottish Widows head of pension investments Maria Nazarova-Doyle says: “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, having recently launched our new Responsible Investment and Stewardship Framework and invested £2 billion in BlackRock’s new Climate Transition World Equity Fund.”