The number of Swiss pension funds embarking on a journey to decarbonise their investment portfolios has increased, from 25% in March 2022 to 36% in March 2024, according to Climate Alliance, a league of civil society organisations.
One third of pension assets totalling CHF1.4trn (€1.5trn) are now invested in line with the goals of the Paris Agreement, the organisation added in its climate report.
Climate Alliance data, has not, however, been able to identify pension schemes on a path to decarbonising investments that can potentially make a tangible impact on society and the economy, it said.
Only 1% of the pension assets in Switzerland are invested to have a positive impact on society, the environment and the climate, or with the prospect of having that kind of impact, being “visionary” schemes, according to Climate Alliance’s definition.
The Asset Management Association Switzerland (AMAS) has published the self-regulation on sustainable finance that has an impact on pension funds, said Sandro Leuenberger, responsible for finance and climate at Climate Alliance.
“Pension funds are less susceptible to be misled by asset managers’ greenwashing. The offer for credible “advanced ESG” funds has considerably grown in the Swiss market for pension funds,” he added.
Still, investments accounting for CHF280bn of pension fund assets remain “in the dark”, as they cannot be independently assessed, Climate alliance added. UBS and Roche pension funds, for example, continue to fail to report transparently on ESG investments, according to Climate Alliance.
This goes against the ESG reporting standards laid out by the pension funds association ASIP recommending schemes to give an overview of their sustainability strategies (including ESG key figures) on their websites, it added.
As a member of the Swiss Sustainable Finance (SSF) group, Roche Pensionskasse takes part in selected surveys and portfolio analyses such as the PACTA climate compatibility test conducted by the Federal Office for the Environment (FOEN), a spokesperson for the company told IPE.
This has confirmed that the ecological footprint of the Roche pension fund is smaller than the average for Swiss pension schemes and significantly smaller compared to the financial market, the spokesperson added.
The Roche pension fund use internal communication channels to inform their beneficiaries transparently about details of the sustainability policy and specific measures relating to the sustainable investment of pension assets, the spokesperson said.
The UBS pension fund did not take part in the report published by Climate Alliance as the organization “has no basis for a rating”, a spokesperson for the bank told IPE.
UBS has long taken ESG criteria into account at various levels of its investment process, the spokesperson explained, adding that the board has defined principles of sustainability strategy, for example excluding investments in companies involved in coal-fired power production from its portfolio.
Moreover, the UBS pension fund has been since 2019 a member of the Institutional Investors Group on Climate Change (IIGCC) and as a supporting investor of Climate Action 100+, and it has also defined a CO2 reduction path for its Swiss real estate portfolio, the spokesperson said.
Looking for IPE’s latest magazine? Read the digital edition here
No comments yet