Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, whether she has considered the risks posed by (a) climate change and (b) nature destruction as factors for the Pensions Commission to take into account.

The Climate Change Governance and Reporting Regulations in the UK already require trustees of larger occupational pension schemes to identify, assess, and manage climate-related risks and opportunities, and to report on these actions in a manner aligned with the Task Force Climate Related Disclosures TCFD recommendations. Regulations do not currently cover nature risks, but in line with guidance from the Pensions Regulator pension schemes should be placing greater consideration on nature-related risks, including familiarisation with the Taskforce on Nature-related Financial Disclosures framework.

My department is legislating through the Pensions Scheme Bill for a larger, more consolidated pensions system, which will be better equipped to manage systemic risks such as those posed by climate change and biodiversity loss, and to invest in projects and businesses that contribute to climate solutions and environmental resilience.

Separately, the Government is currently consulting on UK Sustainability Reporting Standards aligned with international sustainability standards, and Climate Transition Plans. Together these initiatives will support the UK’s net-zero goals and broader green agenda and are expected to influence the investment landscape in which pension schemes operate.

The Government has asked the Pensions Commission to examine the pensions system as a whole and look at what is required to build a future-proof pensions system that is strong, fair and sustainable.