How customers continue to shape the future of the Fossil Fuel Free Plan

Giorgia Antonacci

by , Team PensionBee

24 June 2024 /  

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At PensionBee, our customers have always played a key role in the product development process. Since our launch, our customers have been vocal about their desire to address some of the world’s biggest problems, such as climate change, through their investments.

In direct response to our customer’s feedback, we introduced the Fossil Fuel Free Plan in 2020 - a plan that excludes fossil fuel and tobacco sectors. Just two years later, in 2022 we launched our Impact Plan after customers were increasingly wanting to invest with impact.

Each year we use surveying to reaffirm that our pension plans continue to meet our customers’ investment expectations. In February 2024, we invited customers in the Fossil Fuel Free Plan to share their current views. We asked them about:

  • approaches to fossil fuel divestment; exclusionary screens; and
  • appetite to move to a Paris-aligned or climate transition benchmark in the future.

Here are some of our key findings.

Customer sentiments on fossil fuel financing

Although slightly lower than in 2021, our 2024 results show that the majority of our customers still want to cut ties with companies that continue to fund fossil fuel projects.

Sadly, our customer views are still ahead of available data. The industry continues to lack a reliable dataset that would enable them to exclude companies that fund fossil fuel projects. This is due to the poor quality disclosures from these financiers, who aren’t required to fully disclose their emissions under current regulations.

Paris-aligned climate investing

Since the current plan launched over three years ago, a new approach to climate investing has emerged. This approach focuses on Paris-aligned and climate transition benchmarks. These aim for a minimum 7% annual reduction in carbon emissions to achieve net zero emissions, in line with the 2015 Paris Agreement’s goal of limiting global temperature rise to 1.5°C.

A majority of respondents expressed a desire to move beyond traditional exclusionary-based approaches and towards strategies that align with the Paris Agreement. As a result of the decarbonisation pathway, these types of strategies increase investment in green revenues over time.

Finally, a majority of respondents are happy to pay small one-off costs for an improved plan, provided that the overall cost didn’t otherwise increase.

Next steps

At PensionBee, we’re committed to listening to our customers. We’ll continue to evaluate the FFF plan as well as developing other potential plans that would best reflect our customers’ views. We’ll continue to work closely with our asset managers to implement our customers’ wishes. To help build customer confidence, we’ll also work on developing and sharing educational material on Paris-Aligned investing. We want to thank everyone who participated and shared their views. We rely on customer feedback to keep pushing the market forward and closing the gap between savers’ views and investment plans on offer.

Have a question? Get in touch!

Do you want to know more about your pension plan with PensionBee? You can check out our Plans page to learn how your money is invested in different assets and locations, or log in to your BeeHive to see your specific plan. You can always send comments and questions to our team via engagement@pensionbee.com.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

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