Our ambition is for our investments to become Net Zero for greenhouse gases, not just carbon. We measure the carbon dioxide equivalent (CO2e), where available, to compare the emissions from various greenhouse gases on the basis of their global-warming potential.
Our net zero ambition
We believe climate change presents a significant financial risk. A world of extreme temperatures would not be a liveable world. A disorderly climate transition or a failed transition poses a real risk to our ability to deliver good financial outcomes and fulfil our purpose which is to build a secure financial future for our members and their families. That’s why we’ve set an ambition for our investments to be net zero by 2050, if not before.
We have a legal duty to make sure we can pay our members’ pensions when they’re due, and we’d also like to see a world worth retiring into. So, we’ll continue to make decisions that are in the best financial interest of our members.
But reaching net zero won’t be easy. In fact, it’ll be a huge challenge. It means changing the energy system that’s been powering the world for over 100 years. Investors, companies, policy makers and society will need to work together to achieve it.

How will we do it?
To reach net zero we will:
- Encourage the companies we invest in to transition towards a low-carbon world
- Reduce the carbon footprint of our investment portfolio over time
- Invest in assets that support the transition towards a low-carbon world, like renewables and clean technology
Society can’t divest its way to net zero and neither can we. We’ll encourage the companies we invest in to transition to net zero, rather than just divest from them. Divestment makes no difference to the carbon emitted to the atmosphere and will not address the climate challenge – we believe that engagement and active stewardship of our assets can make a difference. We’d rather be an investor with a seat at the table.
For more on our approach and detail on our progress, see our TCFD summary or our full TCFD report. The Task Force on Climate-related Financial Disclosures (TCFD) is an industry-led group that helps companies and investors understand their financial exposure to climate risk.
Our progress so far
- May 2021: We announced our ambition for our investments to be net zero by 2050, if not before. This is in line with the Paris Agreement – a legally binding international treaty on climate change – and the UK government’s net zero commitment.
- From 2021: We increased integration of climate and carbon considerations into our investment decision making processes. This makes sure we’re considering our net zero ambition when we decide where and how to invest.
- October 2021: We introduced a £500m Sustainable Growth mandate. This mandate invests globally in high-growth, private businesses that are developing ways to help companies and the economy decarbonise. Recently, this included investments in electric-powered aircraft and carbon capture and storage technology. This complements our existing renewable energy strategy. In March 2024, we had around £2bn of renewable energy and clean technology investments. This includes a 50% stake in Bruc Energy, which runs solar farms across Spain.
- February 2022: We set our interim targets to cut the intensity of our non-sovereign emissions by 25% by 2025, and by 50% by 2030. These milestones will help us stay on track, keep ourselves accountable and measure our progress.
- April 2022: We started developing better climate scenarios with the University of Exeter. These will help us better understand how our investments might perform in the future under a range of potential climate outcomes. We will then use this to inform our investment strategy.
- May 2022: We introduced a new climate tilt – a carbon reducing investment benchmark – to a large slice of our equity investments in the Retirement Income Builder (the defined benefit part) and the Investment Builder (the defined contribution part). This will impact over £5bn of our investments and initially reduced emissions by at least 30%, and then by 7% each following year.
- May 2023: We adopted a Responsible Investment Beliefs and Ambition Statement which acknowledges the systemic risks that climate change presents, that we can’t diversify our way out of these, and that integrating responsible investment (RI) across all our asset classes will lead to better financial outcomes for members.
- September 2023: Working with the University of Exeter, we developed four new decision-useful climate scenarios that better reflect the real-world risks and opportunities that will frame our investment decision making to 2030.
- December 2023: Having reduced our emissions intensity from just over 70 tCO 2e per £million to 55 tCO 2e per £million, we are now 39% lower than our 2019 baseline and ahead of our 2025 interim target. Reaching net zero will be an ongoing journey – to achieve our targets, we need to reduce our emissions intensity by between 4.7% and 6.1% a year from our 2019 start point. We are ahead of our interim target but we know this journey won’t be a linear one. Small changes to our portfolio can have a big impact on our carbon footprint.
Reaching net zero will be an ongoing journey – to achieve our targets, we need to reduce our emissions intensity by between 4.7% and 6.1% a year from our 2019 start point. We are on track so far, but we know this journey won’t be a linear one. Small changes to our portfolio can have a big impact on our carbon footprint.
We’ll update this page every year with our progress.
Your questions
Document downloads
-
TCFD Report 2024 pdf (3.42mb)
-
TCFD Summary 2024 pdf (810kb)
-
USS Stewardship Code Report 2024 pdf (3.00mb)
If you're looking for archived reports that are no longer in use, you can find these on our archived responsible investment material page.