BTPS

Sustainable Investment

The Trustee believes that, as a long-term asset owner, the Scheme has responsibilities to consider longer-term factors which impact investment value and investment risk during the holding period. The area of sustainability as defined by the Trustee covers factors such as environmental, social and governance.

The importance of sustainable investment is illustrated by the scheme being a founder signatory to the United Nations-backed Principles for Responsible Investment initiative (PRI) and one of the Trustee Directors, Donald MacDonald, having been that organisation’s chair for four years, retiring during 2010. PRI provides a framework for investors to take environmental, social and governance issues fully into account in their investment and ownership decisions and actions and the Trustee remains committed to its membership and active support of the organisation. Click here to download a copy of BTPS’ response to the PRI Reporting and Assessment survey 2011 and here for BTPS’ individual feedback report.

The Trustee is also guided by the requirements of the Financial Reporting Council’s Stewardship Code for UK institutional investors. For further information click here.

The Trustee believes that as a long-term investor with exposure to investment markets for decades into the future, it should seek to take into account a range of sustainability issues:

It seeks to play a role in fostering the long-term availability and attractiveness of investment markets overall, and to take account of risks to markets as a whole or to any individual market in which it invests.
It seeks to consider long-term risks which may impact investments over the relevant time-horizon, and particularly those risks which are currently poorly understood or managed within the financial markets or corporates.
It seeks to act as an interested and active asset holder of its investments so as to call relevant management to account and to seek to encourage the most effective management of risks and opportunities.

More information about the Trustee’s approach to sustainable investment can be found here and details of particular activities undertaken during 2010 are given here.

Relevant links
Hermes Equity Ownership Services

Principles for Responsible Investment

Mercer Report on Climate Change

UKSIF Sustainable Pensions

Fair Pensions