A six-week consultation on new climate disclosure rules for the UK’s pension sector started on 26th August. Under the proposed changes, pension schemes with £5bn or more in assets under management will be required to both assess and publicly report on the physical and transition risks facing assets in their portfolios by the end of 2022.
Smaller schemes which still have more than £1bn of assets under management would then be subjected to the same requirements by the end of 2023. To ensure that disclosures are uniform, pension schemes will be mandated to follow the recommendations of the Taskforce on Climate-related Financial Disclosures (TCFD).
According to the Department of Work and Pensions’ Secretary of State, once this roll-out is complete, 70% of the UK’s pension sector, in terms of assets under management, would be covered.