With many businesses and pension schemes now talking about becoming net-zero, and with greater coverage in major news outlets discussing a green recovery, it may feel like the world is moving in the right direction in tackling the climate emergency.

But as scientific data shows the world isn’t on track to meet the 1.5°C target set out by the Paris agreement back in 2015.

While it’s encouraging to see many investors and businesses setting net zero targets, this now needs to be followed up with short-term steps to help move economies towards a sustainable footing. We need to avoid a ‘net zero fatigue’ where people hear a lot about targets, ambitions and plans but little on actual action.

With no standardised definition of terms such as net-zero and sustainability, it’s crucial for pension schemes to explain what it means for them and present actionable and realistic plans on how they’re going to get there.

Investors, like Nest, should be thinking about making changes now to stay ahead of the game. The transition towards a low-carbon economy will require potentially limitless amounts of investment, particularly in private markets. High government public spending in recent years means it’s likely pension schemes can get more involved in supporting the financing of sustainable projects.

We believe this presents fantastic investment opportunities, particularly in supporting green infrastructure projects. At Nest, we’ve already taken tangible steps, such as investing in renewable infrastructure projects (like this solar farm near Reading) to help move us closer to our net-zero goals.

To be fully transparent with our customers, we also recently published our climate change roadmap, which specifies attainable long- and short-term goals we’re planning to reach to achieve our climate change related targets. The roadmap will be reviewed and updated annually to keep us on track and demonstrate our progress.

While the financial industry still has a long way to go in supporting the low-carbon economy, an orderly transition can still be achieved and help boost long-term investment returns.