Regulations to improve climate-related reporting for occupational pension schemes now in force
01 Oct, 2021
The Occupational Pension Schemes (Climate Change Governance and Reporting) Regulations 2021 and the Occupational Pension Schemes (Climate Change Governance and Reporting) (Miscellaneous Provisions and Amendments) Regulations 2021) (‘the Regulations’) are now in force.
These Regulations, which were consulted on in February 2021, have been introduced to improve the quality of governance and reporting with respect to climate change risks and opportunities for Occupational pension schemes.
The Climate Change Governance and Reporting Regulations will require, from 1 October 2021, the trustees of schemes in scope to:
- implement climate change governance measures and produce a Task Force on Climate-related Financial Disclosures (TCFD) report containing associated disclosures; and
- publish their TCFD report on a publicly available website, accessible free of charge.
Changes made by the Miscellaneous Provisions Regulations will require trustees who must produce a TCFD report to, among other things:
- include a link to the TCFD report in the Annual Report
- tell members that the TCFD report has been published and where they can locate it, by including this information in the Annual Benefit Statement and, for defined benefit (DB) schemes, the Annual Funding Statement.
The Department for Work and Pension's (DWP's) has published statutory guidance which Trustees of occupational pension schemes must have regard to when meeting requirements under the new regulations. The guidance is split into four parts covering:
- Background
- An overview of climate change governance requirements
- Climate change governance and production of a TCFD report
- Publication of a TCFD report
Additionally trustees should refer to the non-statutory guidance issued by the Pensions Climate Risk Industry Group (PCRIG). This is non-mandatory guidance but might be helpful for trustees to consider in addition to the statutory guidance which must be followed.
Click for:
- The Occupational Pension Schemes (Climate Change Governance and Reporting) Regulations 2021 (link to regs).
- The Occupational Pension Schemes (Climate Change Governance and Reporting) (Miscellaneous Provisions and Amendments) Regulations 2021 (link to regs).
- DWP statutory guidance (link to DWP website)
- Non-statutory PCRIG guidance (link to DWP website)
