Private Managers Hindering Pension Funds’ TCFD Compliance

Pension funds’ Taskforce on Climate-related Financial Disclosure (TCFD) compliance is being “hindered” by private markets managers failing to provide climate data, according to research by pensions and financial consultancy firm Hymans Robertson. Lack of data has significant implications for both defined benefit and defined contribution pensions schemes’ ability to meet their governance and reporting obligations under TCFD, the report warned. The research assessed the level of climate data asset managers could provide on their funds across four asset classes: private debt, private equity, real estate and infrastructure. Results highlighted that there is a “worryingly low level of engagement from some asset managers, with 42% providing data on all funds. A further 14% of managers provided data on some of their funds, while 44% approached did not respond at all. The research also showed that property and infrastructure fund managers are better prepared as just under half – 44% for property and 48% for infrastructure – provided data on carbon emissions. Private equity and private debt managers reported significantly less information on climate issues, with no private debt managers in the survey providing carbon emissions data. Simon Jones, Hymans Robertson’s Head of Responsible Investment, said: “We know there will not be a short quick fix, but all organisations need to recognise the importance of this issue. We expect that asset owners will increasingly seek to differentiate managers on how they address climate risks and the use of minimum standards for climate reporting is likely to be a consideration for our clients.” 

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