The Bedfordshire Pension Fund would need to publish an annual climate risk report if government proposals go ahead.
The Pension Fund Committee heard on Tuesday (20 September) that the government has launched a consultation on the governance and reporting of climate risks by the Local Government Pension Scheme (LGPS) administering authorities.
Proposals include calculating the ‘carbon footprint’ of assets and assessing how the value of each fund’s assets or liabilities would be affected by different temperature rise scenarios, such as the ambition to limit the global average temperature rise to below 2° Celsius, as set out in the Paris Agreement.
The aim is to help to demonstrate climate change risks and opportunity considerations are integrated into each authority’s decision-making process.
Julie McCabe, chief officer for Bedfordshire Pension Fund, said: “These are a number of requirements which will require us to do some analysis and to set targets towards net zero.”
A briefing note in the report said four metrics are proposed; Total Carbon Emissions, Carbon Footprint, Data Quality and a Paris Alignment Metric.
Adding that the proposals for emissions metrics cover Scope 1, 2 and 3 emissions to give the “fullest possible picture” of carbon exposure.
Ms McCabe said: “The Responsible Investment Committee is already working towards this, and has already agreed on a set of metrics.
“It will be responding to the consultation which it will share with the committee ahead of the deadline of November 24.”
Committee chair, Cllr Doug McMurdo (Independent, Sharnbrook) said: “If you look at our equity portfolio today compared to what it was eight months ago, it’s significantly cleaner.
“But let’s not lose sight of our fiduciary duty and that is to pay liabilities when they fall due,” he said.
The regulations proposed by the government are expected to come into force by April 2023.
By John Guinn
Local Democracy Reporter
