We understand that the cost-of-living crisis is having an impact on businesses up and down the country, with employers facing increased costs across the board.
Our recent webinar covered how we are investing your employees’ money to weather the current storm and provided some actionable tips from the Money and Pension Service about how you can help support and retain your workforce. We also shared the latest findings from our Nest Insight team’s research that aims to improve employees’ financial wellbeing.
If you would like to watch the webinar again or to share it with any colleagues that couldn’t attend, the full recording is available below.
The slides are also available to download here.
During the webinar we received a number of questions, below are two questions with their answers that we didn’t have time to respond to during the event.
Q: What is your approach to addressing deforestation in your portfolios?
A: This is something we’re currently focusing on under our natural capital scope of research. We think that natural capital is a risk and opportunity worth considering in our investment strategy. When properly preserved, natural capital assets such as clean water, air, productive soil, forests, and biodiversity provide a wide range of ecosystem services that make life possible and help reduce the effects of climate change. As part of this in depth study we’re focusing on deforestation and land use change, and water pollution and scarcity. In fact, last year we joined Global Canopy’s Deforestation-free pension funds guidance working group to help develop guidance on and help us work towards reducing deforestation exposure across our investments.
Q: It’s great to hear about the green investments that Nest is getting involved with. We have quite a lot of staff who are opted into your Ethical Fund but many would prefer a Green Fund. Is there any reason why you haven’t made this an option?
A: Firstly, thank you for your question. We’re delighted when our employers or their employees want to check how we invest their pension. Our Ethical fund tries to cater for all members who want to invest their money in line with their moral beliefs but that can be hard as values, morals and ethics vary from person to person so our fund is designed to reflect the broad spectrum of views and concerns of people who might want an ethical fund. That’s why we’ve researched our members to understand what people expected from an ethical fund before creating ours. This helped us design a fund that’s based around what’s important to the people likely to be choosing this fund, like avoiding oil, gas or coal companies, companies that don’t follow human rights conventions and make their money from creating or selling weapons, weapons systems or weapons components.
You’ll be glad to know that your employees have chosen an industry recognised fund. The consumer website, Good With Money, ranked our fund among the best ethical pension funds on the market, we’ve also been recommended by Ethical Consumer as one of their Best Buys when it comes to ethical workplace pensions.
When deciding which fund choices to offer, we apply a robust, consistent and evidence-based evaluation based on a framework of considerations which consider the following key areas:
- characteristics of our potential membership which would lead to specific preferences in terms of fund choice and investment approach
- potential legal implications of offering or not offering a particular fund
- likely member demand for such a fund, for example, whether it encourages saving or discourages opt out
- what employers, EBCs and other stakeholders would expect from Nest
- investment and administrative costs of the potential offering
We will continue to monitor fund choice and could add fund choices if there is demand and provided there are investment products on the market that can meet that demand.