C1C2C3Part I Occupational pensions

Annotations:
Modifications etc. (not altering text)
C3

Pt. I: Pensions Act 2004 (c.35), Pt. 3 construed as one with Pt. I of this Act (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 233, 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

Functions of trustees or managers

41AF1Climate change risk

1

Regulations may impose requirements on the trustees or managers of an occupational pension scheme of a prescribed description with a view to securing that there is effective governance of the scheme with respect to the effects of climate change.

2

The effects of climate change in relation to which provision may be made under subsection (1) include, in particular—

a

risks arising from steps taken because of climate change (whether by governments or otherwise), and

b

opportunities relating to climate change.

3

The requirements which may be imposed by the regulations include, in particular, requirements about—

a

reviewing the exposure of the scheme to risks of a prescribed description;

b

assessing the assets of the scheme in a prescribed manner;

c

determining, reviewing and (if necessary) revising a strategy for managing the scheme's exposure to risks of a prescribed description;

d

determining, reviewing and (if necessary) revising targets relating to the scheme's exposure to risks of a prescribed description;

e

measuring performance against such targets;

f

preparing documents containing information of a prescribed description.

4

Regulations under subsection (3)(b) may, in particular, require—

a

that assets are assessed by reference to their exposure to risks of a prescribed description, and

b

that an assessment includes determining the contribution of the assets of the scheme to climate change.

5

The regulations may require the trustees or managers of the scheme to take into account—

a

different ways in which the climate might change, and

b

different steps that might be taken because of climate change.

6

Regulations under subsection (5) may require the trustees or managers of the scheme to adopt prescribed assumptions as to future events, including assumptions about—

a

the steps that might be taken for the purpose of achieving the Paris Agreement goal or other climate change goal, or

b

the achievement of the Paris Agreement goal or other climate change goal.

7

In complying with requirements imposed by the regulations, a trustee or manager must have regard to guidance prepared from time to time by the Secretary of State.

8

In this section “the Paris Agreement goal” means the goal of holding the increase in the average global temperature to well below 2°C above pre-industrial levels referred to in Article 2(1)(a) of the agreement done at Paris on 12 December 2015.