On 5 June 2025, the first reading of the Government’s ‘Pension Schemes Bill’ took place. The bill has been introduced with the aim of both enhancing the pots of pension savers and driving economic growth via greater investment in productive UK assets. Since then, Chair of the Business and Trade Select Committee Liam Byrne MP has tabled a ShareAction amendment to the bill requiring funds to consider the impacts of their investments on beneficiaries’ standard of living and their wider ethical views, as well as ‘system-level’ considerations that could include societal and environmental factors. If accepted by parliament, this would represent a significant step toward ensuring pension funds place greater consideration on how their investments may indirectly contribute to issues like environmental degradation, economic inequality or poor working conditions that inevitably affect the world their savers live in.
Along with a recent Liberal Democrat private members bill on Directors’ Duties’, it is positive to see another recommendation to Government suggested in HPC’s ‘Charter for Fair Pay’ appearing in the policy space. A previous HPC survey showed that 72% of respondents believed pension funds should be required to take steps to understand members’ attitudes to ethical investment, even if members haven’t contacted them directly about it. Given its potential positive impact and widespread public support, it is crucial that this amendment is accepted and incorporated into the wider bill.