The UK Government expects pension funds and investors to consider “withholding capital” or divesting from a company when it isn't “taking appropriate action” on the transition to Net Zero, according to its green finance roadmap.
Released yesterday, the document sets out the government’s long-term ambition to ‘green’ the financial system and align it with the UK’s Net Zero commitment.
In a list of stewardship-related expectations on the pensions and investment sector, the Government says investors should “actively monitor, encourage, and challenge companies by using their rights and direct/indirect influence to promote long-term, sustainable value generation” and that “in some cases, the exercise of stewardship discipline may eventually escalate to withholding capital or divestment. For example, where a company is not taking appropriate action to transition to net zero.”
The expectations appear to be in stark contrast to Pension Minister…