Legal & General Group Plc  |  Climate and nature report 2023
in line with recommendations by the Task Force on Climate-Related Financial Disclosures (TCFD)
Investing in a 
greener future

Climate change is a 
systemic issue impacting 
the economies and 
societies in which we 
operate. Addressing this 
is central to our purpose.
Introduction
At a glance	
2
Chief Executive Officer’s statement	
3
The business context	
4
Developing our approach to nature	
5
Strategy
Our purpose-driven approach	
7
Climate and nature-related 
opportunities and risks	
8
Invest – Our journey to net zero	
9
Invest – Our strategy	
10
Influence – Our journey to net zero	
12 
Influence – Our strategy	
13
Operate – Our journey to net zero	
15
Operate – Our strategy	
16
Scenarios
Our modelling framework	
20
Climate pathways	
21
Group portfolio scenario impacts	
23
Governance	
Board oversight	
27
Group environment governance	
28
Governance Q&A	
29
Risk management	
Risk management framework	
31
Our approach to risk identification	
32
Risk management approach	
33
Metrics and targets	
Metrics and targets summary	
37
Operational carbon footprint	
38
GHG emissions intensity of our  
investments	
39
Implied portfolio 
temperature alignment	
41
Engagement and remuneration	
42
Our operational targets
and commitments 	
43
Additional information	
Our impacts, risks and opportunities 
assessment	
46
Summary disclosure against
TCFD recommendations	
47 
Summary disclosure against
the four pillars of TNFD	
48
Commitments in detail	
49
Deloitte assurance opinion	
51
Metrics dashboard invest	
53
Metrics dashboard operate 	
54
Investment portfolio 
metrics detail	
55
Scope 1 and 2 emissions – Basis of 
Preparation	
56
Scope 3 emissions – Basis of  
Preparation	
58
Entity-level disclosures	
64
Cautionary statement	
65
Contents
Annual report and accounts: 
group.legalandgeneral.com/
AnnualReport2023
Social impact report: 
group.legalandgeneral.com/
SocialImpactReport2023
Climate transition plan: 
group.legalandgeneral.com/
ClimateTransitionPlan2023
Climate and nature glossary: 
group.legalandgeneral.com/
ClimateGlossary2023
Legal & General Group Plc Climate and nature report 2023
1
Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

At a glance
1.	 We define proprietary assets as total investments to which shareholders are directly exposed, 
minus derivative assets, loans and cash and cash equivalents.
2.	 From a 2019 base year.
3.	 Metrics have been rebaselined through a combination of methodology and data sourcing changes.
Figures from the 2022 report provided in the appendix.
4.	 For this interim target, we exclude sovereigns and derivative securities due to a lack of clear industry 
methodologies to account for these asset classes. Please see page 13 for our net zero definition.
5.	 Figures are approximate.
6. 	 To account for the impact of the pandemic our 2021 base year includes estimated emissions data 
from our Real Assets portfolio based on 2019 data. All other base year emissions are from 2021.
	Invest
We are incorporating 
climate considerations into 
how we invest our £92.5 billion 
of proprietary assets1.
Net zero
asset portfolio aligned with 
a 1.5°C ‘Paris’ objective, with a 
50% reduction in GHG emission 
intensity by 2030 and an 18.5% 
reduction by 20252.
	Influence
We are using our influence 
as an asset manager with 
£1.2 trillion of AUM to promote 
a 1.5°C net zero transition.
100%
of AUM in alignment with net zero 
by 2050, working in partnership with 
clients to reach net zero alignment 
across 70% of AUM by 20304.
	Operate
We are changing the way 
we operate to decarbonise 
our business. 
Net zero
scope 1 and 2 GHG emissions 
by 2050, with an absolute 
reduction of 42% by 2030 from 
our 2021 science-based target 
(SBT) base year6. 
Investment portfolio 
economic GHG 
emission intensity
56tCO2e/£m
(2022: 62 tCO2e/£m)3
A 30% reduction from 
our 2019 base year.
Implied temperature 
alignment 
2.5°C 
(2022: 2.6°C)3
Companies rated 
by our Climate 
Impact Pledge5
5,000
(2022: 5,000)
Number of 
environment-specific 
engagements5
2,000
(2022: 636)
Operational footprint 
(scope 1 and 2 
(location))
27,722 tCO2e
(2022: 30,062 tCO2e)
A 29% reduction from  
our 2021 base year.
Employees embraced 
our photography competition, 
after we asked them to submit 
a photograph they had taken 
that encapsulates the 
importance of environmental 
and social issues. We have 
showcased some of the best 
imagery throughout this report.
Legal & General Group Plc Climate and nature report 2023
2
Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Scientists expected 2023 to be one of the hottest 
years on record. As it happened, the reality surpassed 
predictions. The average temperature was 1.45°C 
hotter than pre-industrial levels. Alongside this, we 
saw record ocean heating and unprecedented loss 
of Arctic and Antarctic ice sheets. The second year 
of El Niño is expected to be even hotter. 
The UN Environment Programme forecasts the 
current trajectory of global warming to be well 
above the target agreed in Paris, even if countries 
achieve their current climate commitments. Such 
an outcome would be devastating to ecosystems 
and hugely disruptive to economies.
This backdrop challenges even the most committed 
optimists (I count myself as one). However, the 
picture in 2023 was not universally bleak. While 
the impact of climate change is accelerating, so 
is the engagement of governments, companies 
and individuals in what needs to be done. 
The COP 28 UN Climate Change Conference in Dubai 
last year resulted in a ground-breaking consensus to 
transition away from fossil fuels. Although it stopped 
short of an absolute commitment to phase-out coal, 
oil and gas, it is a significant step that fossil fuels 
were fundamental to the final agreement. Alongside 
the scale-up of clean energy technologies –
renewable energy capacity increased by 50% during 
2023 – it provides hope that we can, together, 
hold-off more significant warming. 
Recent data from the Office for National Statistics 
shows more than eight in 10 adults in Great Britain 
report having made at least some changes to their 
lifestyle to help tackle environmental issues. The 
picture may be negative, but positive action is being 
taken at all levels.
So what can we do? Legal & General has a duty 
to help prevent the worst outcomes from climate 
change: this is a fundamental part of good risk 
management on behalf of our customers, clients 
and shareholders. Our Climate transition plan 
received approval from over 97% of our shareholders 
in May. This ambitious roadmap sets out how we will 
both manage the risks and grasp the opportunities 
that climate change presents, through our influence 
as a shareholder, the investment choices we make 
and the actions we take within our operations. 
Our scale and expertise give us the potential to play 
a crucial role in the reallocation of finance towards 
drivers of the global transition to net zero, both 
through our own assets and through those we manage 
on behalf of our clients. In 2023, we launched our new 
Clean Power (Europe) Fund alongside our partners 
NTR. This raised €390 million in its first close, using 
third-party capital, as well as our own, to invest 
in Europe’s decarbonisation and energy security. 
Looking ahead, we continue to develop our 
understanding of the Group’s impacts and 
dependencies on nature. This topic is intrinsically 
linked to climate change, posing some similar risks 
and opportunities as capital is reallocated to enable 
nature-positive outcomes. Our response to nature 
will build on our existing climate strategy and we’ve 
chosen to rename this report our ‘Climate and nature 
report’, in recognition of this work.
In my first months at Legal & General, I’ve been 
impressed by the depth of our knowledge and the 
commitment of our people, to meeting and mitigating 
the challenges of climate change. I am looking 
forward to supporting our continued progress 
and ambition, to play our part in safeguarding our 
environment for generations to come.
António Simões
Chief Executive Officer
Chief  Executive
Officer’s statement
Transitioning to 
a greener future.
Key updates
•	 Our Climate transition plan was approved 
at our 2023 Annual General Meeting with 
support from over 97% of votes.
•	 We delivered against our plan, achieving 
a year-on-year reduction of 9% for our 
investment portfolio GHG emission 
intensity, and 8% for our scope 1 and 2 
operational carbon emissions.
•	 We made significant developments in 
our understanding of nature, harnessing 
the existing work we have done on 
climate change and deforestation.
•	 We continued to make new investments 
in early stage companies, such as 
Cambridge Electric Cement, who 
are pioneering the decarbonisation 
of the cement industry.
•	 We collaborated to launch a range 
of new investment products, helping 
to encourage the reallocation of 
capital towards the climate transition.
•	 Employees moved into our new Cardiff 
office, Calon, which has achieved a 
BREEAM ‘Outstanding’ rating and has 
been designed to operate in line with 
the current UK GBC net zero pathway.
We have the opportunity 
and the responsibility, to 
be a part of the solution.”
Legal & General Group Plc Climate and nature report 2023
3
Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

The business context
Our businesses work together to deliver our strategic 
purpose and generate value for our shareholders, 
customers and communities. Climate change 
and nature-loss do not fundamentally alter our 
business model but they do impact how we execute 
our strategy.
This page provides a visual representation of our 
business model, demonstrating how synergies 
are driven across the Group to deliver our purpose. 
It provides the context required to understand each 
division’s contribution to our strategic growth driver, 
addressing climate change.
Division
Context
Institutional retirement 
(LGRI)
LGRI is targeting a net zero 
asset portfolio by 2050, with 
our annuity assets being 
managed as a single portfolio.
Investment management 
(LGIM)
LGIM has a market-leading 
investment stewardship 
team and uses its influence 
to promote the transition 
to a low-carbon economy.
Capital investment (LGC)
LGC invests in clean 
energy, technology and 
aims to deliver real estate 
that has a low impact on 
the environment.
Retail
Retail aims to decarbonise its 
annuity assets in conjunction 
with LGRI and provide 
workplace customers with 
opportunities to invest in 
the transition.
Generates
capital
Institutional  
retirement
We provide institutional PRT 
solutions, guaranteeing the 
retirement income for corporate 
pension scheme members.
Generates
capital
Develops assets 
that support our 
pension liabilities
Generates 
AUM
Provides asset 
management 
services, client 
relationships and 
climate expertise
Provides asset 
management services 
and climate expertise
Provides 
asset 
management 
services, 
climate 
expertise and 
co-invests
Builds
alternative
assets,
including
clean 
energy
assets
Capital  
investment
We use some of our customers’ 
pension assets, as well as the 
Group’s shareholder capital, 
to make long-term investments 
in assets such as clean energy 
and housing.
Investment  
management
We are one of the world’s largest 
asset managers and a major 
global investor.
Annuity 
asset 
portfolio 
management
Retail
We are a leading provider 
of UK retail retirement and 
protection solutions and US 
brokerage term life insurance.
Contributes 
DC and 
annuity AUM
Legal & General Group Plc Climate and nature report 2023
4
Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

In May 2023, LGIM became the 
cornerstone investor in the largest 
debt-for-nature swap to date for the 
Government of Ecuador. Debt-for-nature 
transactions essentially enable a 
country to refinance debt under more 
favourable terms and allocate a portion 
of the proceeds towards specific 
nature-related outcomes.
The transaction, which was arranged and 
structured between Ecuador’s advisors, 
a global investment bank and Pew 
Bertarelli Ocean Legacy and insured by 
the US Government, allows Ecuador to 
restructure its debt at much lower 
repayment rates. In return, Ecuador will 
direct savings of USD 450 million 
to marine conservation activities around 
the Galápagos Islands, which are home 
to more than 3,000 species, 20% of which 
are not found anywhere else on Earth.
Ecuador is targeting 18 milestones 
to demonstrate its sustainability 
performance, for which progress will be 
verified by an independent assessor and 
reported upon publicly. In the event that 
it does not achieve these milestones, 
there will be financial penalties.
Debt-for-nature swap
Developing our approach to nature
Introduction
Reducing greenhouse gas (GHG) emissions is a 
major area of focus for us, but action on climate 
change must be pursued alongside efforts to halt 
environmental degradation. We understand there 
are material interdependencies between climate 
change and the natural environment and first 
recognised this publicly in our Climate transition 
plan, released in April 2023.
Since then, we have seen the formal launch of the 
Taskforce on Nature-related Financial Disclosures 
(TNFD) global framework for nature, providing a risk 
management and disclosure framework to identify, 
assess and respond to nature-related issues. 
Over the last year we have continued to develop our 
approach to nature across our business, in response 
to these external changes, and have sought to 
understand the impacts and dependencies that our 
business has on nature. Some of the highlights are 
set out on this page, with further details throughout 
this report.
Climate change remains our most material 
sustainability issue (see our impacts, risks and 
opportunities assessment on page 46) and has 
historically been the main focus of this report. 
Our work on climate change is currently more 
detailed and quantified than our nature-related 
disclosures, with this report being only the first 
step on our journey in consideration of the TNFD 
recommendations. We intend to adopt these 
more widely through our future reporting.
Financial exposure 
to highly nature-
dependent sectors1
35-50%
Number of nature-
specific engagements2 	
	
200
Emerging metrics for understanding the risks
Integrating nature into our existing climate strategy
Invest
We recognise that, as with climate change, our biggest 
exposure to the risks from nature-loss is through our 
£92.5 billion of proprietary assets. The metric above 
is the first step in quantifying this risk and helps us also 
consider how investments can be channelled towards 
nature-positive outcomes. The debt-for-nature swap 
opposite is one example of this.
Influence
We have been engaging on nature, as an asset manager 
with £1.2 trillion of assets under management (AUM), 
for many years, such as through our Climate Impact 
Pledge (CIP) which incorporates deforestation and 
biodiversity considerations. We continue to evolve our 
nature-led engagement as our understanding of the 
risks develops and have recently released our Nature 
Framework for engagement3.
Operate
We disclose the impacts our operations have on 
environmental issues (such as waste and water) 
and continue to develop our approach to these issues. 
As part of this, our real assets business and housing 
businesses have been preparing for Biodiversity Net 
Gain regulations.
1.	 Sectors defined by the TNFD guidance (www.tnfd.global/
publication/additional-disclosure-guidance-for-financial-
institutions/). A range is provided noting the data gaps and 
resultant uncertainties in mapping our exposures to the 
defined sectors.
2.	 Figure is approximate.
3.	 www.lgim.com/landg-assets/lgim/_document-library/
capabilities/nature-policy-document.pdf
Legal & General Group Plc Climate and nature report 2023
5
Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Strategy
Our purpose-driven approach
Our purpose is to improve the lives of our 
customers, build a better society for the long 
term and create value for our shareholders. 
We cannot do this without addressing climate 
change. This has long been a priority for us 
and is one of our six strategic growth drivers.
Calon, The Interchange, Cardiff 
Our new office
6
Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information
Legal & General Group Plc Climate and nature report 2023

Invest
Influence 
Operate
Our purpose is to improve the lives of our customers, 
build a better society for the long term and create value 
for our shareholders – we call this inclusive capitalism. 
Inclusive capitalism is what we do. It drives our strategy, 
shapes our culture and has sustainability at its core.
Ageing  
demographics
Environmental issues are central to inclusive capitalism and are inherent to our six strategic growth drivers. These affect all of us. 
In responding to these long-term drivers, our strategic priorities are set to deliver sustainable profits as well as positive 
environmental and social outcomes. 
Globalisation of 
asset markets
Investing in the  
real economy
Welfare  
reforms
Technological
innovation
Our strategy
Our purpose
We are able to support the fight against climate change and 
nature-loss through the positioning of our own investments, 
using our influence as one of the world’s largest asset managers 
and the way we operate.
As global economies make the changes needed to address 
climate change, this creates an important shift in investment 
allocation and the biggest investment opportunity of our lifetime. 
+
+
Addressing  
climate change
•	 Through reducing the intensity 
of our financed emissions.
•	 Through investing in the transition.
•	 Through the products we offer.
•	 Through our engagement with 
companies, governments and 
policymakers.
•	 Through our operations.
•	 Through the businesses 
we control.
We believe that addressing climate change is the 
right thing to do, not just for our business but for 
the many different stakeholder groups our business 
impacts. Our long-term strategic response remains 
resilient in the face of specific short-term issues. 
We place great importance on considering the needs 
of all of our stakeholders in our decision-making and 
actively encourage their participation. As a systemic 
issue, this makes addressing climate change an 
inherent part of our strategy and the illustration 
opposite demonstrates how our approach aligns 
with the Group’s wider strategy and purpose.
Our Climate transition plan is clear that addressing 
climate change must be pursued in tandem with 
halting nature and biodiversity loss. During 2023, 
it was increasingly recognised globally the impacts 
and dependencies our economies have on nature. We 
welcomed the release of the TNFD recommendations 
during the year and have made our first steps 
towards adoption of these in this report. We are 
building our approach to nature on the three pillars 
of our climate strategy, while recognising that 
integrating nature into decision-making poses 
some unique challenges. 
At Legal & General, our strategy 
is driven by six long-term strategic 
growth drivers. Environmental, 
social and governance issues are 
inherent to all six and central 
to inclusive capitalism.
Our purpose-driven 
approach
Addressing climate change
Legal & General Group Plc Climate and nature report 2023
7
Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Climate and nature-related 
opportunities and risks
Opportunities
Strategic pillar
Potential opportunities
Business area 
most impacted
Horizon
Short
Med.
Long
 Invest
Investing in the technology and infrastructure needed to transition away from carbon emissions, such as renewable 
energy sources, low-carbon properties, low-carbon heating, electrification of transport and nature-based solutions
LGRI, LGIM, 
LGC, Retail
 Influence
Attracting and retaining clients by supporting their needs to decarbonise their investment portfolios, for example 
through net zero-aligned investment products and funds and provision of data and analytical tools
LGIM, LGC
Managing funds that provide clients with access to financing opportunities in transition technologies and 
infrastructure and nature-positive outcomes
Engaging with companies and governments to encourage a fast and orderly ‘just transition’, enhancing trust in our brand
 Operate
Enhanced returns from investing in homes and commercial properties by enabling them to operate with net zero 
carbon emissions and helping to protect and restore nature
LGRI, LGIM, LGC
Increasing our market differentiation through reduced embodied carbon in construction
Protecting our long-term returns by developing real assets with high levels of climate resilience
Risks
Strategic pillar
Potential risks
Business area 
most impacted
Horizon
Short
Med.
Long
 Invest
Investments in sectors or companies which are adversely exposed to a transitioning economy lose value or are 
downgraded, and investments prove ineffective resulting in loss
LGRI, LGIM, 
LGC, Retail
Disruptive technology impacting the value of investments
Increased frequency and/ or severity of extreme weather events, or increased nature-loss, impacting on the value 
of physical assets or the value of companies with high exposures to these risks
 Influence
Loss of market share should investment solutions be perceived as not meeting rapidly evolving client needs
LGIM, LGC
A breach of evolving legislative or regulatory requirements may expose us to litigation or regulatory sanction and 
damage our brand
Reputational risk from not meeting our own commitments, or if activities across the Group are not aligned
 Operate
High delivery costs of low-carbon or nature-positive solutions for residential and commercial properties 
impacting viability
LGRI, LGIM, 
LGC, Retail
High delivery costs due to changing climate and nature-related disruptions to our supply chain, leading to increased 
costs and material shortages
Property values fall due to increased risk of extreme weather impacts, higher insurance costs or poor energy efficiency
Inherent exposure to the risk that key personnel leave the Group, with an adverse affect on performance
While the risks from climate change and nature-loss 
are increasingly evident, the transition to net zero 
and the reallocation of capital to nature-positive 
outcomes, also creates opportunities. This table 
highlights material climate and nature-related 
opportunities and risks that our business has 
identified. These are long-term assessments 
informed by our strategic priorities. Over 2023 our 
key climate and nature-related opportunities and 
risks have remained consistent.
The impacts of climate change and nature-loss 
cause different challenges to each of our businesses. 
This is explained in further detail throughout this 
chapter. They are also likely to shift over time 
and we have used a heat map approach to illustrate 
this. The impacts identified do not take account 
of potential mitigating actions we will take. 
Further information on our risk management 
and identification is available on pages 30 to 35.
Key 
 High impact   Medium impact   Low impact
TCFD recommendation 
Describe the climate-related risks 
and opportunities the organisation 
has identified over the short, 
medium and long term. 
 
Short, medium and long term
•	
Our short-term horizon looks 
at a three year period.
•	
Our medium-term horizon looks 
forward up to 10 years.
•	
Our long-term horizon looks 
at the time horizon up to 2050. 
This strives to challenge and shape 
the very core of our business as 
well as the overall strategy.
Legal & General Group Plc Climate and nature report 2023
8
Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Invest
Our journey to net zero
By 2050
Net zero asset 
portfolio in 
line with a 1.5°C 
‘Paris’ objective
Phase out 
investments in coal 
and oil sands and 
run off high-carbon 
assets4
Reduce 
the carbon intensity of 
our real estate assets
Neutralise 
residual emissions 
through negative 
emission investments
By 2030
50%
portfolio GHG emission 
intensity reduction2
2.1°C
Investment portfolio 
temperature rating for 
listed bonds and equities 
by end 20263
Delivering on our transition plan
Highlights

We took action to reduce the GHG emissions 
of our investments, achieving a 30% 
reduction (from a 2019 base year), keeping 
us ahead of our 2025 interim target.

We continued to invest in early stage 
and growth equity companies, such 
as Cambridge Electric Cement, who are 
pioneering the decarbonisation of cement.

We have disclosed our exposure around 
deforestation and highly nature-dependent 
sectors, as we develop our knowledge of 
our impacts and dependencies on nature.
Dependencies and outlook
Our portfolio transition will be dependent 
on investee entities delivering on their 
decarbonisation targets and the availability 
of attractive assets for investing in the transition, 
alongside delivery of government policy actions. 
The world is not currently on a pathway that will 
limit global warming to 1.5°C, which increases 
the risk of us not achieving our commitments.
The lack of reliable, accurate, verifiable, consistent 
climate and nature-related data continues to make 
it challenging to accurately disclose and assess 
opportunities and risks. 
2023
2030
2050
National Trust 
Our private credit business in 
LGIM, entered into a £25 million 
transaction with the National 
Trust, Europe’s biggest 
conservation charity, to fund new 
renewable energy projects on its 
estates. This funding will be used 
to help develop hydroelectric and 
solar energy projects, to add to the 
portfolio of 140 renewable energy 
projects they have completed on 
their lands over the last 10 years. 
The renewable energy generated 
from these new projects will be 
used to help meet the National 
Trust’s own energy needs, further 
supporting the charity in achieving 
their ambitious ‘net zero by 
2030’ goal.
We are incorporating climate considerations into how 
we invest our £92.5 billion of proprietary assets1.
1.	 We define proprietary assets as total investments to which 
shareholders are directly exposed, minus derivative assets, 
loans and cash and cash equivalents.
2.	 From a 2019 base year.
3.	 On an ‘enterprise value including cash’ emissions-weighted 
temperature score, covering portfolio scopes 1 and 2.
4.	 Investment with more than 5% revenue exposure by 2030.
Legal & General Group Plc Climate and nature report 2023
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Table 1. Total Group investments
Group assets analysed by investment class
Direct
investments2
2023
£m
Traded
securities3
2023
£m
Total
2023
£m
Total
2022
£m
Equities
1,856 
1,310
3,166
3,071
Bonds4
27,671
53,659
81,330
71,773
Derivative assets
–
38,019
38,019
41,978
Property
5,503
–
5,503
5,644
Loans
13
1,599
1,612
1,073
Financial investments
35,043
94,587
129,630
123,539
Cash and cash equivalents
163
4,072
4,235
4,834
Other assets
2,539
–
2,539
2,260
Total investments
37,745
98,659
136,404
130,633
Proprietary assets1
37,569
54,969
92,538
82,748 
1.	 We deﬁne proprietary assets as total investments to which shareholders are 
directly exposed, minus derivative assets, loans and cash and cash equivalents.
2.	 Direct investments, which generally constitute an agreement with another party, 
represent an exposure to untraded and often less volatile asset classes. Direct 
investments also include physical assets, bilateral loans and private equity, but 
exclude hedge funds.
3.	 Traded securities are deﬁned by exclusion. If an instrument is not a direct 
investment, then it is classed as a traded security.
4.	 Bonds include lifetime mortgage loans (as loans against residential property) 
of £5,766 million (2022: £4,844 million).
We consider our main exposures to climate change 
risk to be through our proprietary assets1. Climate 
change is a systemic risk to these assets, but the 
transition to net zero also presents significant 
investment opportunities. Our investment approach 
seeks to mitigate the risks from climate change 
through reducing the intensity of our financed 
emissions, while maximising our impact by directing 
our investments towards the transition. We aim to 
take a similar approach to nature-based risks. 
Through reducing the intensity 
of our financed emissions 
We are committed to achieving a net zero asset 
portfolio by 2050, in line with a 1.5°C ‘Paris’ objective, 
on our £92.5 billion of proprietary assets. We define 
this commitment as net zero carbon emissions by 
2050, alongside rapid, deep and sustained reductions 
in other GHG emissions and we see this as a key 
component of our climate strategy. This commitment 
is supported by a series of interim milestones as seen 
on page 49. Our portfolio decarbonisation commitments 
drive our ambition to promote the benefits of net zero 
and help to mitigate our exposure to both transition 
and physical risks as we move to a low-carbon economy. 
In the short to medium term, we prefer to focus our 
efforts on credible reductions to our carbon footprint 
across all sectors and encouraging others to do 
the same. In addition, our commitments around 
deforestation are aimed at protecting existing carbon 
sinks. In the long term, we expect negative emissions, 
such as through nature-based solutions, to play a 
critical role in balancing out residual emissions to 
achieve net zero.
Our decarbonisation approach is embedded 
within our investment strategy and is constructed to 
manage our short- and long-term responsibilities to 
both our shareholders and policyholders, in line with 
regulation. As a long-dated, bond-heavy investor, our 
decarbonisation approach involves: 
Our proprietary assets
Our proprietary assets are the £92.5 billion of assets 
that Legal & General own and where we control the 
investment strategy. Our proprietary assets contain 
both direct and traded securities across different 
asset classes.
•	 transitioning to lower-carbon investments 
through new business flows
•	 managing the phase-out of higher-carbon 
investments within legacy holdings. 
We maintain a well-diversified portfolio across all 
sectors and we are dependent on the companies we 
invest in decarbonising their business. We actively 
monitor their actions to determine whether their 
plans are aligned to 1.5°C pathways, in support of our 
portfolio temperature rating SBT. We also engage, 
through LGIM, to encourage the right behaviour, 
while implementing investment exclusions where 
appropriate. Our decarbonisation approach supports 
the delivery of our commitments to the Science 
Based Targets initiative (SBTi) and Net-Zero Asset 
Owner Alliance (NZAOA) frameworks. Decarbonising 
our balance sheet is prudent risk management and it 
is managed through a suite of portfolio controls. We 
detail these controls in the risk management chapter. 
Through investing in the transition
We remain committed to directing our investments to 
support the transition where this aligns with our risk 
appetite and regulatory criteria and we see a significant 
investment opportunity in doing so. To date, we have 
invested £3.3 billion in transition finance, including 
£1.4 billion in renewable energy, £1.2 billion in green 
bonds and £0.7 billion in other solutions (such as 
technology, infrastructure and real estate) which 
supports the transition and helps with our resilience 
to climate risk. We are committed to increasing the 
financing of climate solutions, while also reporting 
progress on investments in nature‑based solutions 
by end 2025. 
We deploy a range of investment strategies to 
support the transition and our approach is described 
across the following asset classes: 
•	 Direct investment bonds – Private credit 
and infrastructure debt
•	 Direct investment equities – Private equity
•	 Property – Property/ real estate
•	 Traded securities – Listed bonds and equities.
 Invest
Our strategy
TCFD recommendation 
Describe the impact of climate-related 
risks and opportunities on the 
organisation’s businesses, strategy 
and financial planning. 
We are managing and 
deploying our balance 
sheet proactively as the 
world moves towards 
a lower carbon future.”
Jeff Davies
Chief Financial Officer
Legal & General Group Plc Climate and nature report 2023
10
Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Invest
Our strategy continued
Private credit and infrastructure debt 
Direct investment bonds
LGIM actively manages £16.3 billion of private credit 
investments on behalf of the Group, across 
corporate, infrastructure, alternative and real estate 
debt. This portfolio continues to prioritise origination 
and investment into assets which actively promote 
decarbonisation. The Group has invested £1.0 billion 
in clean energy projects, including solar and wind 
farms, geothermal plants, smart networks and 
energy storage assets. We also have £0.3 billion in 
debt-for-nature swaps, in line with our objective to 
invest in opportunities that support nature.
Our commitments to net zero have been integrated 
into our investment decision-making processes. 
The alignment of proposed investments with our 
climate change objectives is assessed during 
pre-investment due diligence and further scrutinised 
during the investment approval process. This includes 
negative screening criteria, enhanced due diligence 
for carbon-intensive investments and ESG 
assessment checklists. 
Through borrower engagement we have incorporated 
ESG-linked credentials into the structures of £0.3 
billion of investments spanning the social housing, 
higher education and corporate sectors. This is 
where funding from us must either be designated 
for ESG-related purposes or have criteria linked to an 
ESG-related target. These loan structures incentivise 
a borrower to achieve specific sustainability-related 
targets, including those related to net zero. 
Due to the range and size of the portfolio, we have 
some exposure to fossil fuel-related assets. 
These exposures are regularly monitored and 
are constrained by carbon budgeting, our SBTs 
and wider corporate commitments. 
We have a similar focus on our private credit 
allocations managed by external asset managers.
Lifetime mortgages
In addition, we have £5.8 billion of lifetime mortgage 
loans held within our annuity portfolio. We are actively 
seeking ways to enhance insight into the energy 
efficiency of properties going forward by including 
EPC ratings within property valuations. We are 
working with multiple third-parties to source this 
data and analyse it. This will enable us to develop our 
product to further support our climate-related goals. 
We also access sophisticated models that assess 
the flood risk associated with the underlying 
properties to ensure our exposure remains low, 
even under higher global warming scenarios. 
Pemberton
LGC has a 40% equity stake in Pemberton, a €19.1 
billion AUM pan-European alternative credit manager 
and a member of the Net Zero Asset Managers 
initiative (NZAMi). LGC has cornerstoned six 
Pemberton-managed funds with seed capital, while 
LGRI has also invested c.€400 million primarily 
through structured investment grade debt. 
Pemberton is a signatory of the PRI and is compliant 
with SFDR; its newest direct lending vintages are 
Article 8 compliant and each investment proposal is 
screened against positive and negative ESG criteria. 
Pemberton has also granted financial incentives for 
borrowers which meet carbon reduction targets or 
ESG key performance indicators on €7.9 billion (41%) 
of commitments to 74 borrowers. 
Private equity: clean energy and venture capital
Direct investment equities
We invest in clean energy through LGC, supporting 
the transition to a low-carbon economy and 
capitalising on the associated commercial 
opportunities, accessing growth and good returns for 
our shareholders while also delivering environmental 
and social benefits. Since 2015, we have successfully 
invested in a wide range of early stage, growth equity 
companies and low-carbon infrastructure that will 
play an important part in the energy transition. 
In 2023, LGC increased its investment and support 
of Kensa – the UK’s leading ground source heat 
pump manufacturer – by a further £70 million, jointly 
with Octopus Energy. This will help Kensa to scale-up 
job creation and heat pump installation, supporting 
the UK’s target of 600,000 heat pump installations 
per year by 2028. LGC has also invested in Cambridge 
Electric Cement, founded by three Cambridge 
academics, it is developing a pioneering approach 
to decarbonise cement production; and invested in 
Advanced Electric Machines, an electric vehicle motor 
manufacturer which does not use rare earth materials. 
Venture Capital (VC) plays a critical first role in the 
investment ecosystem and LGC’s dedicated VC 
programme has deployed capital into innovative 
companies supporting advances in sectors such 
as renewable energy and energy demand reduction. 
Property/ real estate
Property
We have significant investments in property, 
managed through our LGIM Real Assets business. 
Our strategic approach to this asset class is covered 
in the operate chapter.
Urban regeneration 
Our capital division’s Urban Regeneration team 
has a strong track record investing capital across 
the UK. Our collaborative approach brings together 
capabilities and expertise from across Legal & 
General and through unique partnerships; working 
with communities, local institutions and local 
government to meet their funding needs and deliver 
social and environmental benefits. For example, 
our partnership with Oxford University is delivering 
high-quality places to live, learn and work – 
integrating some of the UK’s leading environmental 
standards on carbon reduction, biodiversity, circular 
economy and transport. 
Meanwhile, 2023 saw a major expansion of Bruntwood 
SciTech, securing £500 million of additional 
investment and welcoming the Greater Manchester 
Pension Fund into the specialist real estate partnership 
with Bruntwood SciTech. Plans for a £5 billion 
UK-wide real estate portfolio include ambitious 
net zero targets, for both new-build and retrofit. 
Digital infrastructure 
Society is reliant on digital infrastructure to support 
the economy and enable socially beneficial activities 
such as medical research. Our investments in assets 
such as data centres are helping to drive more energy 
efficient, low-carbon solutions in a traditionally 
energy-intensive sector. 
Listed bonds and equities
Traded securities
Our listed bond portfolio is primarily managed within 
our LGRI business and is managed and monitored 
against GHG emission intensity and temperature 
alignment metrics. We set our investment strategy, 
create our strategic asset allocation plan and take 
proactive steps where needed to be aligned to our 
net zero trajectory. We also have £1.2 billion of green 
bond investments. 
In line with our fiduciary duty to policyholders and 
shareholders in maintaining portfolio security and 
value, we maintain a well-diversified portfolio across 
all sectors. As such, we have some exposure to fossil 
fuel-related companies, but manage these the range 
of controls detailed in the risk management chapter. 
We have invested £870 million in our listed equity 
and multi-asset fund portfolio in LGC, where 
approximately £190 million is invested through our 
Climate Impact Pledge portfolio, consisting of listed 
clean energy stocks and other companies in the 
renewables space. Approximately £600 million is 
invested in climate and wider responsible investment 
funds, predominantly through LGIM’s Future World 
product range. 
Legal & General Group Plc Climate and nature report 2023
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

By 2050
By 2030
Delivering on our transition plan
Highlights
We engaged with over 2,000 companies 
specifically on their approach to vital 
environmental issues – a significant 
increase on last year, primarily driven by the 
expansion of our Climate Impact Pledge.
We expanded our product range, with 89% 
of new products launched during 2023 
having ESG considerations – 24% of these 
are either net zero-aligned or had an existing 
‘Paris’-aligned benchmark.
Dependencies and outlook
Net zero is dependent upon the willingness of 
stakeholders to collaborate. When using our 
influence we are dependent on clients, occupiers 
of our properties and the companies we invest in 
to take action to support the transition to net zero. 
2023
2030
2050
Net zero GHG 
emission intensity 
across all our AUM
55% 
reduction in carbon 
intensity of occupier 
energy use across real 
estate equity assets2,3
Target net zero 
operational 
carbon 
within the Sustainable 
Defined Contribution 
Property Fund
Net zero carbon 
for all LGIM real 
estate equity assets 
by 2050 (or sooner)
70%
of eligible AUM to be 
managed in alignment 
with net zero1
Infrastructure equity
In April 2023, LGIM and NTR announced the first 
close of the L&G NTR Clean Power (Europe) Fund. 
The fund invests in a blend of onshore and offshore 
wind, solar and energy storage projects in Europe, 
across development, construction and operational 
stages. Our capital division was a cornerstone 
investor in the fund, alongside third-party capital. 
It plays a key role in helping us meet our commitments 
for both our own investments and those we manage 
on behalf of clients.
We are using our influence as an asset manager with 
£1.2 trillion of AUM to promote a 1.5°C net zero transition.
1. 	 Excludes sovereigns and derivative securities until such 
time as agreed methodologies exist.
2. 	 From a 2019 base year.
3.	 Our Real Assets strategy is detailed on page 17.
 Influence
Our journey to net zero
Legal & General Group Plc Climate and nature report 2023
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

As the largest investment manager in the UK, with 
total AUM of £1.2 trillion, we are committed to using 
our scale and influence to contribute to the transition 
to a low-carbon and nature-positive economy. We are 
working with clients and investee companies to 
manage the systemic risks of climate change and 
nature-loss. 
We are committed to net zero GHG emissions by 
2050 across our managed assets. We have also set 
an interim target to work in partnership with clients 
to reach net zero alignment across 70% of eligible 
AUM by 20301. To be considered net zero-aligned, 
amongst other characteristics, portfolios must set 
targets to achieve either a carbon intensity reduction 
of 50% by 2030 relative to a 2019 base year, or 
portfolio temperature alignment of 1.5°C by 2030.
We integrate climate change considerations across 
asset classes and investment management styles 
(such as active, index and real estate), while our 
investment stewardship team engage with investee 
companies aiming to protect clients’ assets through 
raising market standards on sustainability.
Through the products we offer
Our investment management division, LGIM, 
manages responsible investment strategies across 
multiple asset classes and management styles.
We act as long-term stewards for our clients’ assets 
and are focused on driving real-world change through 
stewardship, aiming to mitigate the exposure of their 
assets to the systemic risks of climate change and 
nature-loss, as well as other sustainability issues. 
We also recognise the investment opportunities 
inherent with the reallocation of capital that is 
needed to transition to net zero and have launched 
products to capitalise on this. As clients pursue their 
own transition plans, we place ourselves to best serve 
their needs, through our responsible investment 
research and approach and investment products.
Responsible investment framework
We have a fully-integrated framework for responsible 
investment which is detailed in the LGIM Active 
Ownership report2. The framework was updated 
during 2023 to take into account new investment 
capabilities to achieve environmental outcomes 
and to continue to align with clients’ sustainability 
objectives. It now leverages the work of our 
dedicated engagement programme, the CIP 
(see page 14), by divesting from companies that 
are not meeting our minimum standards in specific 
responsible investment products3. Our range of 
products allows clients to choose from strategies 
that focus on decarbonisation, net zero-alignment, 
thematic investments in clean technologies, or 
prioritise engagement-led investing.
Innovative partnerships
During 2023 we launched several innovative 
products. We partnered with the Swedish public 
pension provider, AP7, to establish a climate action 
strategy. This active investment strategy aims to 
deliver tangible change while unlocking long-term 
shareholder value by investing in and engaging with, 
companies that are under-performing against the 
climate transition, but who have potential to achieve 
net zero. This strategy aims to play a part in ensuring 
that the market as a whole, not only climate leaders, 
rise to the net zero transition challenge as rapidly 
and effectively as possible. We leverage both our 
investment and stewardship capabilities through a 
data-driven fundamental analysis, and engagement-
led investment approach, to target both attractive 
risk-adjusted returns and real-world outcomes.
We also partnered with NTR, a leading renewable 
energy specialist, to launch a fund that aims to seize 
the high growth opportunities present in Europe’s 
energy transition. The L&G NTR Clean Power 
(Europe) Fund aims to offer exposure to a diversified 
portfolio of clean power infrastructure assets with 
attractive risk-adjusted returns and positive 
environmental and social impacts. Against the 
backdrop of technological advances, regulatory 
changes and the international focus on energy 
security this partnership offers an opportunity 
to be meaningfully involved in the climate transition. 
The fund raised €390 million in committed capital 
and co-investment opportunity in its first close. 
Product developments
In 2023, 89% of the strategies we launched had 
ESG considerations and 24% of them were either 
net zero-aligned or had an existing ‘Paris’-aligned 
benchmark. 
Strategies with ESG considerations employ either 
ESG tilting, ESG exclusions, CO2 reduction targets, 
or a combination of these. In 2023, we launched the 
L&G ESG Global Corporate Bond Index Fund which 
uses positive tilting for ESG criteria; and the L&G 
Global Brands ETF, which employs ESG exclusions, 
among other launches.
Net zero strategies focus on assessing a portfolio’s 
carbon emissions intensity and temperature 
alignment profile during portfolio construction 
through our Net Zero Framework. Strategies with 
a ‘Paris’-aligned Benchmark are designed to meet 
the minimum standards of the EU Paris-aligned 
Benchmark and include both exclusions and 
a decarbonisation criterion. In 2023, we expanded 
our fund range in both these strategies.
Supporting clients through data and insights
Monitoring and reporting on progress is also 
fundamental to our strategy. Clients are supported 
through our LGIM ESG score, our proprietary, 
rules-based approach to scoring companies from 
an ESG perspective, which since 2023 includes 
biodiversity, deforestation and water management 
considerations. The LGIM website supports clients 
with its insights and press releases, such as a recent 
white paper covering how we have updated our 
proprietary climate scenario modelling tool kit to 
assess the climate-related risk for our investments4. 
1.	 Excludes sovereigns and derivative securities until such time 
as agreed methodologies exist.
2.	 See page 19 of LGIM’s Active Ownership report.
3.	 The scope of our Responsible Investment Framework is all 
public markets pooled funds domiciled in or widely distributed 
by LGIM in the UK and Europe. Therefore, it is not applicable to 
segregated mandates, funds domiciled outside of the UK and 
Europe, or funds designed to specific client requirements that 
are not intended for broad distribution.
4.	 www.lgim.com/uk/en/insights/esg-and-long-term-themes/net-
zero-2050-more-affordable-than-ever-if-we-act-now/
 Influence
Our strategy
Recognising the potential 
investment opportunities 
and risks from climate 
change and providing 
solutions for a low-carbon 
transition, are part of 
the role of a responsible 
investment manager.”
Michelle Scrimgeour
Chief Executive Officer, LGIM
LGIM Active ownership report
See LGIM’s Active Ownership report: 
www.lgim.com/uk/en/responsible-
investing/active-ownership/
Legal & General Group Plc Climate and nature report 2023
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Influence
Our strategy continued
Through our engagement with companies, 
governments and policymakers
Effective stewardship tackles systemic issues that 
represent material risks and opportunities for clients. 
LGIM’s stewardship activity is guided by six global 
stewardship themes, which it considers to be 
financially material and where we evaluate that as 
investors we can best use our influence: climate 
change, nature, people, health, digitisation 
and governance. 
LGIM’s campaigns are constructed around these 
themes, aiming to improve sustainability not just for 
individual companies, but across the markets our 
clients are invested. The different engagement levers 
used include: direct engagement with companies; 
collaborative engagement with peers and industry 
bodies; voting; policy and regulator engagement; 
public pressure; and co-filing shareholder resolutions. 
We follow a structured approach so it is clear 
when we escalate. Throughout our campaigns, 
from setting objectives to ranking companies and 
reporting regularly, we aim to be transparent about 
our activities not just to our clients, but also to the 
market more broadly.
LGIM’s Climate Impact Pledge (CIP)
The CIP is a two-fold engagement programme, 
structured around the TCFD framework, which aims 
to encourage companies to tackle climate change. 
Companies not meeting our minimum standards 
may be subject to voting sanctions and some may be 
subject to exclusion from relevant LGIM portfolios; 
exclusions apply to almost £176 billion of assets1.
The CIP assesses more than 5,000 companies 
across 20 climate critical sectors quantitatively 
on their climate credentials, using c.70 data points, 
before publicising the results on the LGIM website. 
In 2023, it identified 299 companies as qualifying 
for voting sanctions for failing to meet our minimum 
standards. LGIM also selects over 100 companies 
that it considers to be potential ‘dial-movers’, due 
to their size and potential to galvanise action in their 
Collaborations and policy engagement
LGIM’s engagement strategy for improving 
sustainability standards across markets includes 
engaging with policymakers to tackle systemic 
market issues. Engagement on the wider integration 
of climate and nature disclosures is a fundamental 
aspect of our approach. We are supportive of, and 
a ‘forum member’ of, the TNFD. The issuance of the 
TNFD framework in September 2023 involved input 
from academia, civil society, governments and over 
1,000 market participants including LGIM. It is 
fundamental in enhancing understanding of 
nature-related impacts and dependencies.
Among other examples, LGIM is a signatory of the 
Business for Nature ‘Make it Mandatory’ campaign, 
calling for governments to adopt Target 15 of the 
Global Biodiversity Framework, requiring all large 
businesses and financial institutions to assess and 
disclose their biodiversity-related risks by 2030. 
We are also an active member of the collaboration 
on microfibres, organised by First Sentier Investors, 
as part of which, LGIM has been involved with 
encouraging governments to introduce legislation 
for microfibre filters on new washing machines. 
In the corporate sphere, we remain active members 
of Climate Action 100+. Specific to the financial sector, 
LGIM’s CEO is a member of the GFANZ Principals 
Group. Launched in 2021 at COP26, GFANZ 
describes itself as a global coalition of leading 
financial institutions committed to accelerating the 
decarbonisation of the economy. We also co-lead 
a workstream on index investing, which launched 
in 2023, aiming to help develop the next generation 
of net zero indices for index-investors looking to align 
themselves with the transition.
We believe collaboration strengthens our voice and 
helps investee companies and policymakers identify 
and address systemic market issues and encourages 
the acceleration of progress against global 
sustainability goals.
sectors, for direct engagement and qualitative 
assessment based on sector-specific net zero 
guides. In June 2023, 12 companies were kept 
on the divestment list and two companies added. 
One company was removed from this list due to 
improvements versus minimum expectations. 
The annual publication of the results of LGIM’s 
assessments and engagements increases pressure 
on companies to take more action on climate.
LGIM can apply further pressure by voting on and at 
times co-filing shareholder resolutions. For example, 
in 2023 it co-filed a shareholder resolution at Exxon 
Mobil’s AGM. The resolution requested greater 
disclosure of asset retirement obligations, which 
are considered financially material to investors and 
linked to the climate transition.
Engagement on nature
Our approach to nature is structured across four 
‘sub-themes’: natural capital management, 
deforestation, circular economy and water. These 
map across to the direct drivers of nature-loss that 
are having the greatest impact, as identified by the 
Intergovernmental Science-Policy Platform on 
Biodiversity and Ecosystem Services. Examples 
of strategic engagement on the sub-themes 
include engaging on key integration and disclosure 
frameworks, such as the TNFD and domestic and 
regional policies and regulation, such as the EU 
Nature Law and Global Roadmap for the Agriculture 
and Land-use sector. 
We regularly collaborate to increase our influence. 
Policy engagement work includes the Investor Forum 
working group on water, which engages the UK 
government and regulators on strengthening the 
UK water system. Other corporate engagement work 
includes the Nature Action 100, Valuing Water Finance 
Initiative, Finance Sector Deforestation Action. 
Our climate collaborations include:
•	 Aldersgate Group
•	 Better Building Partnership (BBP)
•	 Climate Action 100+
•	 Energy Transitions Commission
•	 FAIRR
•	 Get Nature Positive
•	 Glasgow Financial Alliance for Net Zero 
(GFANZ)
•	 Institutional Investors Group on Climate 
Change
•	 Nature Action 100
•	 Net Zero Asset Managers initiative 
(NZAMi)
•	 Net Zero Asset Owners Alliance (NZAOA)
•	 One Planet Asset Managers Initiative
•	 Powering Past Coal Alliance (PPCA)
•	 Principles for Responsible Investment 
(PRI)
•	 Science Based Targets initiative (SBTi)
•	 Sustainable Markets Initiative
•	 UK Green Building Council
1.	 Companies are divested from selected funds with £176.4 billion 
in assets under management (as at 31 December 2023), 
including funds in the Future World fund range, LGIM’s ESG 
fund ranges and all auto-enrolment default funds in L&G 
Workplace Pensions and the L&G Mastertrust. Companies are 
divested up to a pre-specified tracking-error limit. If the 
tracking error limit is reached, holdings are reduced rather than 
fully divested.
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Dependencies and outlook
Our SBT requires an absolute reduction in 
emissions but we do not expect our pathway 
to net zero to be linear. Given the absolute 
nature of our target, if our businesses grow faster 
than we are able to decarbonise, we will see an 
increase in absolute emissions in the short term. 
Net zero standards continue to emerge and 
we recognise our approach and definitions 
may need to change as industry practices 
and technology evolve.
2023
By 2050
Net zero 
operational 
carbon footprint
Net zero 
carbon across 
our real estate 
equity platform
All new homes 
will be capable 
of operating at 
net zero carbon
By 2030
42%
We will reduce our 
absolute scope 1 and 2 
GHG emissions by 42% 
from a 2021 base year1
Our core occupied offices (scope 1 and 2)
and business travel to operate at net 
zero carbon emissions2
2030
 Operate
Our journey to net zero
The Eco Home
CALA completed its first concept for a net zero 
home, built with modern construction methods 
including a timber frame, low-carbon bricks, triple 
glazing and enhanced insulation. It also incorporated 
new technologies including solar panels, an air 
source heat pump, battery storage, smart lighting 
and an aerated shower which has wastewater heat 
recovery and reduces water usage. The home also 
incorporated biodiversity considerations including 
bird boxes, rain gardens, hedgehog highways and 
composting facilities.
Delivering on our transition plan
Highlights
Our scope 1 and 2 operational footprint has 
decreased 8% this year (and 29% from our 
2021 base year), due to energy efficiency 
measures delivered and changes in our 
underlying businesses1. 
Set and disclosed our science-based target 
for our purchased goods and services.
Developed our operational approach 
to biodiversity and nature.
2050
We are changing the way we operate to decarbonise our business. 
1.	 To account for the impact of the pandemic our 2021 base year includes estimated 
emissions data from our Real Assets portfolio based on 2019 data. All other base 
year emissions are from 2021. 
2. 	 Applies to occupied offices where we actively control the management of utilities.
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

How we operate our business and the businesses 
we control is critical to the success of our climate 
strategy. From the office spaces our people use 
and the way they choose to travel to work, to the 
assets we manage and the homes we build – all of 
these activities build and shape our carbon footprint 
and each presents both challenges and opportunities 
on our journey to net zero.
Chart 1 sets out the portion of our operational scope 
1 and 2 emissions that are attributable to each of our 
three principal contributors: our LGIM Real Assets 
business; our LGC housing businesses; and our core 
occupied offices. We are committed to a 42% 
reduction in our scope 1 and 2 GHG emissions 
by 2030, from a 2021 base year1.
Through our operations
Our operational emissions are those where we 
have direct control over the actions that create the 
emissions. We therefore have a responsibility to 
shape our business strategy to build reductions into 
our operations, and to help stay aligned with our SBT. 
In addition to our SBT we have a target specifically 
for our offices – from 2030 our occupied offices 
(scope 1 and 2) will operate with net zero emissions2. 
This target drives our location strategy, which 
is shaping how we come together to work and 
collaborate in our offices and has sustainability 
and employee experience as key requirements. 
Our biggest step to date in delivery of our location 
strategy was the occupation, in October 2023, of our 
new office in Cardiff. Previously we were a tenant in 
two separate offices in Cardiff, neither of which were 
on track to reach net zero. As part of our location 
strategy we have, for the first time, shaped the 
design and build of our workspace in central Cardiff. 
In designing this building, we ensured that net zero 
and nature-related considerations were prioritised. 
Below are examples of how ‘Calon’, our Cardiff office, 
will help us reduce our impact on climate and nature:
•	 designed to operate with a lower carbon footprint 
than a standard office. We have on-site solar 
panels, and technology which enables the building 
to react to its changing environment (such 
as blinds and a lighting system which respond 
automatically to light-levels, helping to ensure 
the most energy-efficient use of lighting)
•	 achieved a BREEAM ‘Outstanding’ rating and 
registered with the NABERS UK standard 
The kWh/m2 will be externally assessed within 
the first two years of occupation
•	 no on-site parking (except for those with mobility 
requirements), cycle and shower facilities for 
active travellers, and conveniently positioned 
for public transport
•	 over 3,000 plants
•	 utilised local suppliers and products throughout.
Through our purchased goods and services
Purchasing over £700 million of goods and services 
from c.1,900 suppliers, is a large contributor to our 
scope 3 GHG emissions. It is our third largest 
category of scope 3 emissions, after those from our 
investments and our downstream leased assets and 
we want to ensure that we are working with suppliers 
who share our net zero ambition and are already 
taking strides to manage their carbon footprint. 
In looking to achieve real-world emission reductions 
from our supply chain, our most pressing challenge 
is to gather accurate carbon data. This is a challenge 
for many organisations, as robust supply chain 
emissions data is difficult to access due to lack of 
capabilities in the supply chain and its fragmented 
landscape. A recent survey by the SBTi found that 
only 6% of respondents currently use supplier-
specific emissions factors.
We recognise that measuring and reducing the 
emissions from the goods we purchase is important. 
Therefore, we have set a supplier engagement target 
which aligns with the SBTi guidance for financial 
institutions. We commit to ensuring that 80% of our 
suppliers, by spend, will set a science-based carbon 
reduction target by the end of 2026. It requires our 
suppliers to measure their footprint and set their own 
carbon reduction targets. 
This enables us to take positive action now within our 
supply chain while tools and expertise are developed 
and data is captured. This approach follows the 
‘influence first’ approach we take as an asset 
manager with our other commitments, while enabling 
us to build improvements across our supply chain. 
As we support, encourage and over time require 
the adoption and implementation of robust carbon 
reduction targets throughout our supply chain, 
we expect to see real-world impacts.
Our intention is to use this target as a stepping stone 
to gather supplier data and, when data is more widely 
available, set an emissions reduction target.
 Operate
Our strategy
Chart 1.
Real Assets
LGC housing businesses
Group operations
Operational footprint 
breakdown (%)
1.	 To account for the impact of the pandemic our 2021 base 
year includes estimated emissions data from our Real Assets 
portfolio based on 2019 data. All other base year emissions 
are from 2021.
2.	 This target applies to our occupied offices where we directly 
control the management of utilities. Noting that the detailed 
definition of net zero is still emerging and that an element of 
offsetting may be required when we have reached the emerging 
industry benchmarks for net zero energy performance.
Legal & General Group Plc Climate and nature report 2023
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Through the businesses we control
Our Real Assets business
Our Real Assets business in LGIM holds an extensive 
real estate portfolio. The emissions associated with 
managing these assets, produced from the fuels and 
electricity that we purchase and control as a landlord, 
are the largest contributor of (13,111 tonnes) to our 
operational footprint. 
As a long-term investor, we have a responsibility to 
protect our clients’ capital by mitigating the risk of 
stranded assets and increasing the long-term value 
of our real estate portfolios. LGIM is committed to 
achieving net zero carbon across the real estate 
equity platform by 2050 (or sooner). Under our 
group-wide SBTs, we have also committed to an 
absolute reduction in our operational footprint (scope 
1 and 2) of 42%, and a 55% reduction in the carbon 
intensity of the scope 3 emissions associated with 
the energy use of our occupiers, by 2030 and from a 
2019 base year. Achieving these commitments aims 
to future-proof our portfolios by creating better 
quality, better performing assets.
Our Real Estate Net Zero Carbon Roadmap laid out 
LGIM’s strategy to transition our real estate portfolio 
to net zero carbon1. The definition of net zero 
buildings is still in development under the UK Net 
Zero Buildings Standards and in our roadmap 
we apply the current definition as set out by the UK 
Green Building Council framework2. This requires 
measuring and reducing embodied carbon, using the 
energy hierarchy to drive down the demand of our 
properties to lower energy levels, increasing 
renewable energy supply and only considering 
verified offsetting as a final step.
In 2023, we published an update to our roadmap, 
outlining the progress we have made to date in 
implementing our strategy3. Key updates include 
the continued rollout of net zero audits for new 
acquisitions and targeted existing assets, which 
identify the measures required to achieve net zero 
and associated costs. At the end of 2023, we had 
completed audits on over 150 assets in our real 
estate platform. Through a series of pilots, we have 
also developed a new Integrated Energy Solutions 
strategy, to support the delivery of on-site renewable 
energy generation, electric vehicle charging, microgrid 
and battery storage projects. An implementation 
guide has also been created to support the rollout 
of the strategy in 2024.
Vizta, our occupier engagement platform, has 
now been embedded across 80 assets. This 
platform supports occupiers with delivery of their 
decarbonisation strategies by providing them with 
detailed energy-use profiles and access to integrated 
tools and resources, including sustainability insights, 
live chat support and regular thought leadership 
pieces. We have also strengthened our ESG data 
strategy, focusing particularly on improving the 
accuracy and robustness of occupier data. This is 
supported by the rollout of Automatic Meter Readers, 
which have now been installed in more than 140 
assets, an increase of approximately 75% from the 
previous year.
Given the significant interactions between assets 
and nature across the real estate value chain, we 
view managing biodiversity as an important element 
of responsible property management. For new 
developments, we are aligning with upcoming 
Biodiversity Net Gain (BNG) planning requirements. 
To support this, we have developed a guidance 
document to support design teams with the 
implementation of new regulations. We have also 
undertaken a pilot project to review how BNG can 
be assessed across our assets, with the intention 
to roll this out across the wider platform next year. 
The physical impacts of climate change also 
present an increased risk for LGIM’s real estate 
portfolios and increasing portfolio resilience is 
essential for maintaining the safe and effective 
operation of our assets. We work closely with 
physical climate risk specialists, XDI and Marsh, to 
embed climate risk into our investment processes. 
All assets have been modelled for their physical risk 
exposure across eight climate perils, which indicated 
that flood risk poses the most significant risk to our 
portfolios. More information on our approach is 
provided in the risk management chapter. We 
will also publish further detail on our climate risk 
approach later this year in alignment with the BBP 
Climate Change Commitment.
As long-term investors 
in the built environment, 
we believe we have a 
pivotal role to play in 
decarbonising portfolios 
on behalf of our clients 
and in the real economy’s 
transition to net zero.”
Bill Hughes
Global Head of Real Assets
 Operate
Our strategy continued
1. 	 www.lgim.com/landg-assets/lgim/real-assets/_old/
responsible-investing/real-estate-net-zero-carbon-roadmap-
report-retail_final.pdf
2. 	 www.ukgbc.org/resources/net-zero-carbon-buildings-a-
framework-definition/
3.	 www.lgimblog.com/landg-assets/lgim/_document-library/
capabilities/ra-equity-net-zero-carbon-roadmap.pdf
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Scenarios
Governance
Risk management
Metrics and targets
Additional information

Our housing businesses
Our housing businesses, in LGC, provide homes for 
all demographics, ages and tenures, helping to tackle 
the UK’s housing crisis and support our mission 
of delivering positive place-based social impact. 
Well-designed homes and communities can be 
low-carbon and sustainable, while helping to protect 
and restore nature. However, there are challenges 
to overcome for this to become business-as-usual, 
which our housing businesses and the wider 
construction industry are grappling with.
We remain firmly committed to all new homes 
we deliver being capable of net zero carbon in 
operation from 2030 and continued to make progress 
towards this during 2023: 
•	 Inspired Villages Group opened the UK’s first net 
zero (regulated) carbon retirement community, 
at Millfield Green, incorporating ground source 
heat pumps from our portfolio company Kensa
•	 our Suburban Build to Rent business beat its 
50% target to record 80% of homes invested 
in being gas-free
•	 CALA built a high-specification ‘Eco House’ near 
Peterborough, which will be closely monitored 
in occupation, to learn lessons that can be 
implemented across the business at scale. 
One of the key metrics against which we benchmark 
our progress is Energy Use Intensity (EUI). Having 
begun piloting this metric in 2022, we refined our 
approach in 2023. Our headline performance, which 
can be seen on page 54, is encouraging, but highlights 
that more progress is needed to reach best practice 
by 2030. 
As buildings become more energy efficient and use 
lower-carbon sources of energy, the embodied 
carbon associated with their materials and 
construction becomes proportionately higher. 
Previously a somewhat hidden impact, this is 
rising to prominence in the construction sector. 
We are committed to monitoring and reducing 
embodied carbon and 2023 is the second year 
in which we are reporting our performance, 
(see page 54), having continued to trial and refine 
our measurement process. Our largest housebuilder 
CALA has set a target of achieving the 2030 industry 
target for embodied carbon by 2025 and has been 
rolling out timber frame construction to enable this. 
This year CALA acquired Taylor Lane, one of the 
UK’s leading timber frame construction specialists, 
to support this goal. Comparison against peers on 
EUI and embodied carbon can be difficult, given the 
lack of public reporting on these metrics by many 
housebuilders.
Both operational and embodied carbon are topics 
that continue to evolve. We are engaging with new 
regulation and industry initiatives that will both 
support and in some cases challenge us in the 
coming years.
There are also nature-related risks and opportunities 
associated with housebuilding in addition to 
Biodiversity Net Gain requirements (covered on page 
17). For example, through our supply chain, where all 
our businesses have a target to source 100% of their 
timber from sustainable sources and through the 
land-use change associated with our developments. 
HVO fuel
Following a successful trial in one 
of its regions, HVO (hydrotreated 
vegetable oil) has now been rolled out 
across all CALA sites as an alternative to 
diesel in their construction vehicles and 
on-site generators. 
HVO emits only a fraction of the emissions 
of diesel and leads to better mileage from 
vehicles (plus reduced maintenance). 
Sustainability data for 2023 suggests that 
emissions from site liquid fuel has now 
reduced by over 58% since 2021 across 
CALA sites as a direct result of this 
fuel switch.
We see HVO as a stepping stone to a more 
permanent alternative to on-site diesel. 
We will continue to utilise this carbon 
efficient fuel across our developments, 
ensuring that all purchased supplies hold 
appropriate sustainability certification to 
guarantee the source of the product. 
Meanwhile, we are also seeking new 
alternative construction technologies to 
help our transition away from diesel fuels.
 Operate
Our strategy continued
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Scenarios
Climate scenario analysis
Scenario analysis helps us to understand the 
strategic implications of possible climate 
pathways, including the key features of the 
transition to a net zero economy. We use 
scenarios to explore the role our organisation 
can play, alongside policy and corporate 
action, in mitigating climate risks and 
supporting opportunity.
Frozen Lake Michigan 
Credit: Cherilyn Vorster
Senior Technology Delivery Manager, Chicago
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information
19

Transition
Physical
How might energy and land systems transition 
to achieve global climate targets?
How would physical climate change 
affect macroeconomic output?
The least costly solution to limiting future 
emissions to the levels required to limit global 
warming to below 2°C, preferably 1.5°C.
The impact of temperature on labour 
productivity.
Our bespoke energy system model, relying on:
•	
>100 unique public and proprietary 
data sources
•	
>2 million variables and assumptions 
including detailed energy technology costs
•	
an open-source land use model2. 
Academic studies on the impact 
of climate change on labour 
productivity and economic output.
•	
carbon prices
•	
GHG emissions
•	
afforestation
•	
sector-level decarbonisation requirements
•	
energy prices
•	
bioenergy and food prices
•	
change in GDP.
•	
change in GDP.
This produces 
outputs including:
Country and sector-level impacts, which we can translate into changes in listed 
companies’:
•	
net income
•	
balance sheet
•	
cash flow
•	
temperature alignment.
We first translate 
these to:
Financial impacts on the value of individual:
•	
sovereign bonds
•	
corporate bonds
•	
listed equities.
We are also able to evaluate at the whole portfolio-level.
Finally, we are  
able to evaluate:
Our modelling framework
We develop our own bottom-up scenarios of 
how energy and land systems may evolve to 2050. 
The ‘Paris’ objective set out its goal to limit global 
warming by 2100 to well-below 2°C, ideally 1.5°C 
above pre-industrial temperatures. In trying to model 
plausible pathways to these outcomes, we must try 
to capture change across energy and land systems 
and make difficult trade-offs between minimising 
the impacts from short-term policy changes and 
the long-term physical risks from climate change. 
Our LGIM Destination@Risk toolkit translates these 
scenarios into company, sector and portfolio-level 
implications. We use two main metrics: one is 
climate risk, which describes the potential risk from 
various climate scenarios to asset valuations and 
the other is temperature alignment, which assesses 
whether companies are contributing to the changes 
we require to reach global climate commitments, 
or whether they are putting them at risk.
LGIM Destination@Risk framework
The outputs of the LGIM Destination@Risk 
framework enable us to develop our broader strategy, 
including how we invest, influence and operate.
When engaging with our scenario outputs, it is 
important to remember that these are scenarios, not 
projections of the future. There is a large degree of 
uncertainty associated with the energy transition and 
the associated global temperature increase. Building 
our scenarios requires us to make a large number of 
assumptions, any of which could prove incorrect with 
the potential of materially invalidating all, or key parts, 
of our scenarios.
Below, we briefly outline the differences between our 
four climate scenarios on several key dimensions. 
For more detailed information on our scenarios, 
including sector case studies, please see last year’s 
LGIM whitepaper1.
Inaction
Approximate global 
warming by 2100
3-4°C
Global failure to act on 
climate change means 
emissions continue to 
grow at historical rates. 
Below 2°C
Approximate global 
warming by 2100
<2°C
Immediate, ambitious 
policy and investment 
action to address 
climate change limits 
global warming to below 
2°C, but warming most 
likely exceeds 1.5°C.
Net Zero 1.5°C
Approximate global 
warming by 2100
1.5°C
Immediate, highly 
ambitious action to 
address climate change 
leads to a reduction in 
emissions to net zero 
around 2050.
Delayed Below 
2°C
Approximate global 
warming by 2100
<2°C
Policy and investment 
action to limit warming 
to well-below 2°C 
is delayed to 2030, 
resulting in much 
more disruptive change. 
Warming most likely 
exceeds 1.5°C.
Our modelling framework
1.	 www.lgim.com/uk/en/insights/esg-and-long-term-themes/net-zero-2050-more-affordable-than-ever-if-we-act-now/
2.	 MAgPIE – An Open Source land-use modeling framework (Version 4.4.0), www.github.com/magpiemodel/magpie
Risk type
Objective is 
to understand:
To do this 
we assess:
Based on:
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Strategy
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Governance
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Metrics and targets
Additional information
20

Chart 23.
70
60
50
40
30
20
10
0
2020
2025
2030
2035
2040
2045
2050
Global GHG emissions (gigatonnes of CO2e/year)
● Inaction ● Below 2°C ● Net Zero 1.5°C   
● Delayed Below 2°C
Source: LGIM Destination@Risk
Chart 43.
● Coal ● Oil ● Natural gas ● Bioenergy ● Nuclear ● Hydro ● Other renewables
Historical
Inaction
Below 2°C
Delayed Below 2°C
Net Zero 1.5°C
2020
2030
2040
2050
2030
2040
2050
2030
2040
2050
2030
2040
2050
Share of global primary energy demand (%)
Source: LGIM Destination@Risk
100
90
80
70
60
50
40
30
20
10
0
Chart 33.
2020
2025
2030
2035
2040
2045
2050
800
700
500
300
100
900
600
400
200
0
● Below 2°C ● Net Zero 1.5°C ● Delayed Below 2°C 
Source: LGIM Destination@Risk
Global carbon price 2020 USD/tCO2e
Climate pathways
Emissions and carbon prices
As shown in Chart 2, global GHG emissions in the 
Inaction scenario continue to grow, ending around 
10% higher than 2020 by 2050, but must gradually 
fall to around 19 gigatonnes (Gt) and 6Gt in the Below 
2°C and Net Zero 1.5°C scenarios, respectively. As 
decarbonisation in the Delayed Below 2°C scenario 
only begins in 2030, it must decarbonise faster and 
further than the Below 2°C scenario, to around 10Gt 
CO2e by 2050.
To achieve these emissions reductions, global 
carbon prices (per tCO2e, see Chart 3) in the Below 
2°C and Net Zero 1.5°C scenarios would need 
to reach around USD 70 and USD 110 by 2030 and 
around USD 200 and USD 500 by 2050, respectively1. 
Delayed Below 2°C carbon prices do not rise until 
after 2030 and, as a result, must reach a much higher 
level by 2050 to achieve the emissions reductions 
required to stay on track for less than 2°C of warming 
by 2100.
The Delayed Below 2°C scenario remains the most 
economically disruptive of our climate scenarios. 
Due to the delay in policy action, emissions 
reductions need to be quicker and less cost efficient 
than in our immediate action scenarios. As a result, 
the Delayed Below 2°C pathway is over four times 
more costly to economic output than the Below 2°C 
scenario and almost twice as expensive as the Net 
Zero 1.5°C scenario.
Implications for the global energy mix
Fossil fuel demand continues to grow in our Inaction 
scenario, with both coal and natural gas each growing 
by around 30% over the period to 2050. Oil, on the 
other hand, stays roughly constant, as electric 
vehicles grow their market share in the transport 
sector even without carbon pricing. By contrast, total 
fossil fuel demand falls by around a third in the two 
Below 2°C scenarios and more than half in the Net 
Zero 1.5°C scenario by 2050. For both immediate 
action scenarios, fossil fuel demand would need 
to peak by 2025.
Deployment of renewables must accelerate 
considerably in our Below 2°C and Net Zero 1.5°C 
scenarios. Even in the Inaction scenario, where 
annual additions continue at similar levels to 2020, 
combined solar and wind capacity increases by 
nearly six times by 2050. By comparison, the Net 
Zero 1.5°C scenario would require average solar 
capacity additions of 450GW every year to 2050 – 
more than double the record 192GW added in 20222.
Hydrogen fulfils more than 10% of final energy 
demand by 2050 in the Net Zero 1.5°C and the 
Delayed Below 2°C scenarios and 6% in the Below 
2°C scenario. It is produced from a mix of bioenergy 
with carbon capture and storage (BECCS), natural 
gas with CCS and electricity, and is primarily used 
to decarbonise heavy road transport and shipping.
CCS is deployed in our decarbonisation scenarios 
from 2030. By 2050, total carbon captured and stored 
per year reaches around 5Gt CO2 in the Below 2°C 
scenario, 7.5Gt in the Net Zero 1.5°C scenario and 
nearly 9Gt in the Delayed Below 2°C scenario, around 
1Gt of which is from direct air capture.
Chart 4 shows the implications of these trends for 
the global primary energy mix:
•	 the energy mix in the Inaction scenario remains 
relatively stable 
•	 in the Below 2°C scenario, the energy system 
gradually moves away from coal and oil, while 
growing bioenergy, nuclear and renewables 
demand to represent more than 40% of total 
primary energy in 2050
•	 our Net Zero 1.5°C scenario sees the energy 
system immediately and rapidly tilt towards 
bioenergy, nuclear and renewables, which 
provide 60% of total primary energy by 2050
•	 the Delayed Below 2°C scenario follows the 
Inaction scenario until 2030. Demand for coal 
and oil then falls rapidly to 2050, by over two 
thirds and half, respectively, while demand for 
renewables and bioenergy grows sharply.
1.	 The model sets a carbon price in each period to limit emissions to within the global carbon budget, assuming the technology options 
available at that time. This means the carbon price is best thought of as the cost of the last, most expensive tonne of carbon globally 
abated in each period. Carbon prices are quoted in constant 2020 USD.
2.	 www.irena.org/Publications/2023/Mar/Renewable-capacity-statistics-2023
3.	 2020 data is estimated not actual.
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Climate pathways 
continued
Land cover change
Chart 5 shows the global land cover change relative 
to 2020. Negative numbers indicate that the global 
area dedicated to the land use has declined since 
2020, positive numbers indicate net growth in the 
type of land use. 
•	 Carbon pricing creates incentives for significant 
afforestation, resulting in net forest cover 
growth in all decarbonisation scenarios by 
2040 – compared to continued reduction in 
global forest cover in the Inaction scenario. Much 
of the net forest growth takes place on pastures 
and rangelands.
•	 Cropland growth is driven by growth in food 
and bioenergy demand. We assume dietary 
composition is unchanged across scenarios, 
meaning that food demand is the same across 
the four scenarios, even though carbon pricing 
makes the most emissions-intensive food 
products, such as beef, more expensive.
•	 Cropland growth is smaller in the decarbonisation 
scenarios relative to Inaction, as carbon pricing 
incentivises investments in yield-increasing 
technologies, due to increased competition 
between cropland and forestry over limited 
land resource. This results in higher agricultural 
productivity in our decarbonisation scenarios 
compared to the Inaction scenario.
•	 Competition for land between afforestation, 
crops and pasture also increases food prices in 
our decarbonisation scenarios. Overall real food 
expenditure would rise by 1.5% per year on average 
globally to 2050 in the Net Zero 1.5°C scenario 
relative to the Inaction scenario. In the more 
disruptive Delayed Below 2°C scenario, food 
expenditure would rise around 5.6% on average per 
year globally in the decade after policy action starts 
in 2030, relative to Inaction and stabilise thereafter. 
Chart 51.
-1,000
-800
-600
-400
-200
0
200
400
600
800
1,000
● Cropland ● Forest ● Other land ● Pastures and rangelands ● Urban area
Inaction
Below 2°C
Delayed Below 2°C
Net Zero 1.5°C
2030
2040
2050
2030
2040
2050
2030
2040
2050
2030
2040
2050
Land cover change relative to 2020 (million ha)
Source: LGIM Destination@Risk
Chart 61.
0%
20%
-20%
-40%
-60%
-80%
40%
60%
-140%
-120%
-100%
2020
2025
2030
2035
2040
2045
2050
Reversal of changes in the Biodiversity Intactness Index from the period 2000-2020 
● Inaction          ● Below 2°C           ● Net Zero 1.5°C          ● Delayed Below 2°C
Source: LGIM Destination@Risk
Biodiversity
Since expanding our modelling to include the 
land use system, we have begun examining 
the impact of our climate scenarios on some 
nature-related variables, including biodiversity. 
The biodiversity intactness index (BII) provides 
a summary measure of the impact of human 
activity on the presence and abundance of 
species on earth. It estimates the original 
percentage of birds, mammals, plants, fungi, 
and insects that remain and their abundance 
in any given area, despite human impacts2.
The global BII is currently around 80%. A BII of 
90% or more indicates sufficient biodiversity for 
an ecosystem to be resilient and functioning. 
Below this, function and reliability of the 
ecosystem may be negatively impacted. If the 
BII falls below 30%, the ecosystem faces risk of 
collapse. The global average hides a significant 
degree of regional variation, with some areas 
at much higher risk than others. The UK for 
example only retains around half of its natural 
biodiversity, placing it in the bottom 10% of 
countries globally3.
We find that global biodiversity would continue 
to decline in our Inaction scenario, due to 
cropland expansion and deforestation, at a 
similar rate as the last 20 years. By contrast, 
our decarbonisation scenarios at minimum 
prevent further biodiversity loss from 2020. 
In our Net Zero and Delayed scenarios, around 
40% of the loss incurred from 2000-2020 is 
reversed through positive policy action. We 
aimed to balance climate objectives of land use 
change with biodiversity considerations in our 
scenarios, but policies could go further in 
reversing historic biodiversity loss.
1.	 2020 data is estimated not actual.
2.	 Further information on the BII: www.nhm.ac.uk/our-science/data/biodiversity-indicators/about-the-biodiversity-intactness-index.html
3.	 www.nhm.ac.uk/discover/news/2020/september/uk-has-led-the-world-in-destroying-the-natural-environment.html
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Additional information

Energy
Utilities
Materials &
industrials
Consumer, 
non-cyclical
Communications
Financial
Government
Other
Industry sector by valuation (%)
0
1
2
3
4
5
6
7
8
● Energy ● Utilities ● Materials & industrial ● Consumer, non-cyclical 
● Communications ● Financial ● Other 
Net Zero 1.5°C
Below 2°C
Delayed Below 2°C 
Cumulative downgrades to sub-investment grade (%)
2030
2040
2050
2030
2040
2050
2030
2040
2050
AAA
AA
A
BBB
BB or below
Portfolio ratings 
by valuation (%)
Group portfolio
scenario impacts
TCFD recommendation
Describe the resilience of 
the organisation’s strategy, 
taking into consideration 
different climate-related 
scenarios, including a 2°C 
or lower scenario.
The LGIM Destination@Risk toolkit allows us to 
evaluate climate risk and alignment at a company, 
sector and portfolio-level, by: 
1.	 converting scenarios into company and sector-
level impacts, providing financial impacts on 
various metrics including net income, balance 
sheet and cash flows – this covers both transition 
and physical impacts of the scenario 
2.	 using asset valuation models to convert these 
company financial impacts into corporate 
security impacts (i.e. equity and bond valuations 
and bond ratings) 
3.	 using our sovereign bond valuation model to 
convert corresponding country-level scenarios 
into sovereign bond valuations. 
Scenario results are produced for the three pathways 
which are based on transition risks (Below 2°C, Net 
Zero 1.5°C and Delayed Below 2°C). We do not apply 
the Inaction scenario to our portfolio. We expect most 
of the associated impact to be driven by physical risks 
which tend to be highly localised and manifest further 
into the future and hence are more uncertain.
Bond downgrade analysis
Given the importance of bonds within our portfolio, 
we first consider the impacts of climate risks on the 
credit quality and sector breakdown of our portfolio.
We are primarily a long-dated ‘buy-and-hold’ bond 
investor, managing our portfolio to match our short- 
and long-term payments to retirement customers. 
Our balance sheet and cashflow matching is 
therefore more impacted by bond downgrades 
and defaults than movements in bond value.
The credit rating exposure of our bond portfolio is 
shown in Chart 7, showing that 99% of the portfolio 
is investment grade (rated BBB and above). Of this, 
BBB-rated bonds, which carry the greatest credit 
transition risk, comprise 32% of the portfolio and 
of those, the ones from the high-carbon sectors 
(defined as energy, utilities, materials and 
industrials) only comprise 9% of the bond 
portfolio. We would expect our holdings in 
high-carbon BBB-rated bonds to reduce over 
time as we decrease the carbon intensity of the 
portfolio and lower the chance of experiencing 
transition-driven downgrades.
While our holdings are in bespoke bond portfolios, 
giving us more freedom in sector selection, we 
have exposure to most sectors in the investment 
universe to maintain a well-diversified portfolio, 
with the modelled breakdown given in Chart 8.
For this analysis, we have directly modelled 
c.£29 billion (36%) of the Group’s £81.3 billion 
of proprietary bond assets, on a line-by-line basis 
as of 31 December 2023. 
The cumulative amount downgraded to sub-
investment grade, which would have negative 
implications for our balance sheet, is shown in 
Chart 9. Note, this year, we have enhanced the 
model to implement basic portfolio rebalancing 
actions for holdings that are sub-investment grade 
at or after maturity, to reduce the instances where 
holdings are reinvested into sub-investment grade 
positions1. Migration rates are lower than when 
modelled with no rebalancing assumptions. 
Left unmanaged, cumulative downgrades to 
sub-investment grade by 2050 are 5%, 12% and 
19%, respectively, across the three scenarios, 
higher than the 3%, 7% and 7%. 
Chart 8.
Chart 7.
Chart 9.
Active trading
We have modelled the impacts 
on our portfolio assuming no 
active trading beyond expected 
rebalancing, at or after, maturity. 
In reality, we would take pre-emptive 
management actions to avoid 
downgrades through our ongoing 
active credit risk management.
1.	 Our risk model is based on our year-end holdings, projecting asset impact through the period to 2050. As a ‘buy-and-hold’ investor, 
while we may hold each bond until maturity, it is highly unlikely we would reinvest in an equivalent bond where the rating falls below 
investment grade once the bond has matured. We have assumed no management actions are taken prior to a bond’s maturity date, 
in relation to the current portfolio, but that we will rebalance after maturity for credit risk management purposes.
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2025
2030
2035
2040
2045
2050
Group equity portfolio impacts 
through time (%)
● Below 2°C ● Net Zero 1.5°C ● Delayed Below 2ºC
Source: LGIM Destination@Risk
-30
-25
-20
-15
-10
-5
0
2020
Group portfolio scenario impacts
continued
Chart 9 also shows the high-level sector breakdown 
of the modelled downgrades, with a large proportion 
arising from high-carbon sectors, as expected. The 
Delayed Below 2°C scenario also creates notable 
GDP impacts, with greater impacts across all 
sectors. These results show the broad sector 
impacts, but each sector can encompass a large 
range with winners and losers over different time 
periods. This includes, for example, some utility 
companies that do not survive in the Below 2°C 
scenario while others experience near zero risk.
We note that any impacts to 2050 are beyond the 
duration of most of our current portfolio. Future 
investments will be influenced by climate change 
trends and we would therefore expect to change 
our allocation away from the names most materially 
impacted under each scenario.
Equity portfolio analysis
In addition to the bond portfolio analysis, we also 
model the c.£0.6 billion of our £1.3 billion proprietary 
traded equity portfolio on a line-by-line basis.
As for bonds, the modelling coverage is limited by 
the availability of data (noting our data caveat) and 
the unmodelled portfolio is assumed to follow the 
modelled portfolio in the absence of other information.
Our analysis shows 2050 impacts (assuming a static, 
unmanaged portfolio) of -10.7%, -18.0% and -28.6%, 
in the Below 2°C, Net Zero 1.5°C and Delayed Below 
2°C pathways respectively, as shown in Chart 10. 
For this analysis we assume that the equity mix 
does not change through time. The impact by risk 
type demonstrates that most of the risk impact is 
through transition risk, over the modelled period, as 
expected, across the three scenarios, with physical 
risks muted over this modelled time period.
Our modelling of equity values is driven by company 
performance in each pathway and not by investor 
risk expectations. Our analysis shows that climate 
risk is not fully reflected in asset pricing and we 
expect some impact on prices as the risk is realised 
over time. A reduction in value can be expected on 
the most at-risk stocks and sectors (indicated by 
high-carbon intensity or a high-risk location). 
However, we would expect to avoid such impacts 
through our ongoing active portfolio management.
Combined portfolio valuation impacts
To complete the analysis, we combine the valuation 
impacts across our bond and equity portfolios, 
while also breaking down the impacts between 
physical and transitional risk drivers, with the 
resultant impacts shown in Tables 2 and 3. As 
expected, the transitional risk impacts dominate 
the total impact, while the total valuation impact 
is heavily weighted by the larger bond portfolio.
Data caveat
Outputs of our LGIM Destination@Risk model, which 
translates our scenarios into asset value risks, must 
be considered in the context of key modelling choices. 
The focus of the model is on risks to asset valuations 
and credit ratings given current exposure. This means 
the model holds both our portfolio’s composition 
(apart from expected rebalancing at or after maturity) 
and company behaviour constant for the entire period 
to 2050, without incorporating projections of future 
growth or decarbonisation targets. It also means we 
do not assess opportunities associated with a 
low-carbon transition. 
When it comes to emissions data, which is used for both 
implied temperature alignment and risk calculations, 
we rely on third-party data. There are still large segments 
of the listed company universe where we are forced 
to rely on estimated rather than actual emissions 
data, or where there is no data at all. Our modelling 
approach currently does not cover private companies 
for the same reason – there is not enough data 
available. We will continue to encourage companies 
to measure and report their emissions through our 
engagement activities.
Table 2. 
Group portfolio undiscounted 2050 portfolio value impacts – by risk
Below 2°C 
Net Zero 1.5°C
Delayed Below 2°C
Physical risk 
(0.4%)
(0.4%)
(0.4%)
Transition risk
(1.1%)
(2.6%)
(4.0%)
Total
(1.6%)
(3.0%)
(4.4%)
Table 3. 
Group portfolio undiscounted 2050 portfolio value impacts – 
by asset class
Below 2°C 
Net Zero 1.5°C
Delayed Below 2°C
Bonds
(1.4%)
(2.7%)
(3.9%)
Equities
(10.7%)
(18.1%)
(28.6%)
Total
(1.6%)
(3.0%)
(4.4%)
Chart 10.
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Metrics and targets
Additional information

Consumer, Non-cyclical
Consumer, Cyclical
Banks, Finance & Insurance (Debt)
Communications & Technology
Energy, Utilities & Commodities
Other
No exposure
Exposure to issuers identified 
in datasets with potential 
deforestation risks
TNFD Sectors – Directly Mapped
TNFD Sectors – Indirectly Mapped - Lower bound
TNFD Sectors – Indirectly Mapped - Upper bound
Non-TNFD sectors
Portfolio exposure to sectors with 
material nature-related dependencies
and impacts
Group portfolio scenario impacts
continued
We took part in the Bank of England’s Biennial 
Exploratory Scenario on climate change exercise 
through 2021 and 2022, testing the resilience of 
the current business models of the largest banks, 
insurers and the financial system to climate-related 
risks, the results have been published here: 
www.bankofengland.co.uk/stress-testing/2022/
results-of-the-2021-climate-biennial-exploratory-
scenario
As a contributor to the Financial Resilience working 
group of the Climate Financial Risk Forum CFRF, 
we continue to evolve our climate risk assessments 
in line with the associated industry guidance.
Scenario risk analysis: strategic resilience
We have identified four broad mitigations to our 
transition risk exposure.
•	 Our exposure is largely through financial assets, 
many of which are listed, so we have significant 
flexibility to adapt by trading to the desired carbon 
position. This is the expected outcome should 
active engagement fail. This gives us more 
flexibility than businesses which have to 
fundamentally change their business models.
•	 We hold mainly investment grade bonds, which 
are matched against liabilities such that we are 
not materially exposed to price risk compared to 
investors who regularly trade their bond portfolios 
or those holding greater exposures to equities.
•	 We will continue to carefully manage our balance 
sheet and actively manage our credit portfolio. 
We continually analyse our credit exposures and 
where appropriate, seek out opportunities to 
improve credit quality at attractive pricing levels. 
We have incorporated climate considerations 
within our credit and market risk management 
and expect these to develop over time. We 
manage our transition risk from climate change 
through setting our portfolio decarbonisation 
targets. These pre-emptive management actions 
are expected to reduce the credit risk of the 
portfolio and are expected to reduce the impact of 
the credit stresses presented in these scenarios. 
Our decarbonisation strategy also covers our 
equity portfolio.
•	 The balance sheet is well-diversified across 
different sectors of the economy. Our initial 
assessment of our implied portfolio temperature 
alignment indicates that we do not have an 
over-weight allocation to the highest carbon 
intensity names within the market sectors.
Deforestation
Chart 11 shows that c.15% of our holdings are 
with names who have been identified on the 
following data sources related to tracking 
potential deforestation risk exposures:
•	 SPOTT: 10 issuers
•	 Forest 500: over 100 issuers
•	 CDP Forest: over 100 issuers
•	 Sustainalytics: 68 issuers.
We internally score the issuers identified 
above, based on differing levels of deforestation 
management and expect our exposure to 
actual deforestation risks to be less than 15%. 
We also monitor external developments in data 
capabilities in this space, helping us to continue 
to improve our understanding of the underlying 
risks. It is an area of focus for us, and our 
existing mitigations are covered as below:
•	 internal risk assessment (explained above)
•	 LGIM Deforestation Policy and engagement 
(see pages 34 and 14 respectively)
•	 exclusions (see page 34)
•	 membership of the NZAOA Deforestation 
working group.
Nature-related dependencies and impacts 
Looking wider than deforestation, Chart 12 
bottom right shows that 35-50% of our holdings 
are currently exposed to a set of sectors 
considered to have material nature-related 
dependencies and impacts, as described in 
the TNFD financial sector guidance1. A range 
is provided, noting the data gaps and resultant 
uncertainties in mapping our exposures to the 
defined sectors.
Chart 11.
Chart 12.
1.	 www.tnfd.global/publication/additional-disclosure-guidance-
for-financial-institutions/
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Additional information

Governance
Responsibility and accountability
Environmental management is central 
to our commercial success. Our business 
model works because we invest today’s 
capital in a way which will drive benefit for 
decades to come. Accountability for building 
a sustainable business is shared across the 
business and supported by governance that 
is led by our Board.
Bee on a sunflower 
Credit: Will Jones  
Fund Oversight Supervisor, Cardiff
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Additional information

Legal & General Group Plc Board
Board, GMC, GRC and ERC
Climate Committees
Other Committees that consider climate risk
Risk Committees that consider climate risk
Reporting line
Reporting of specific issues
Investment
Committee
Group Management
Committee (GMC) 
Executive Risk 
Committee (ERC)
Group Risk 
Committee (GRC)
Group Environment 
Committee (GEC)
Environment
Subcommittee 
Climate Risk
Subcommittee 
LGIM Investment 
Stewardship Team 
Divisional Risk
Committees
Group Risk Financial
Risk Committee
Group Non-financial 
Risk Committee 
Board oversight
The Group Board (‘the Board’) is ultimately 
accountable for the long-term stewardship of 
the group. Responding to climate change and 
addressing nature-loss and the opportunities 
and risks associated with these issues are of 
significant importance to the Board. 
Nilufer von Bismarck, a non-executive director 
on the Board, has a responsibility to give specific 
focus to climate change and nature-loss in her 
role. This does not take away from the collective 
responsibility of the Board for oversight of 
environmental matters; rather it ensures climate 
and nature-related risks and opportunities across 
the Group are raised on all relevant topics 
discussed by the Board.
Throughout the year, responding to climate risks 
continued to feature as a risk on the strategic risk 
register and remained at the top of the Board’s 
agenda. The Group Chief Financial Officer, Divisional 
CEOs and Group Chief Risk Officer discussed climate 
risks as part of their regular reporting to the Board, 
particularly in relation to the Group’s risk appetite. 
The Board also noted the increased regulatory 
focus on the subject.
Approval of the Group’s Climate transition plan was 
one of the most significant decisions the Board took 
during 2023 and it now receives regular updates on 
how the Group is progressing against the climate and 
nature commitments this document sets out. The 
Board also participated in an ‘executive awareness’ 
session on biodiversity, providing important context 
for how these issues might be integrated into the 
Group strategy.
The GRC oversees the risks associated with climate 
change to ensure exposures are controlled in line 
with the Group’s risk appetite and ensures that 
management actions are also aligned. Alongside 
regular updates on the risks associated with climate 
change, the committee receives regular climate-
specific management information.
During 2023, Carl Moxley replaced Simon Gadd 
as our Group Climate Director, with responsibility 
for coordinating the Group’s response to climate 
change and incorporating nature and biodiversity 
opportunities and risks. The role has the senior 
manager responsibility of ensuring that an 
appropriate strategy is in place to understand, 
identify, measure, monitor, control and report the 
opportunities and risks from climate change in line 
with the risk strategy and risk appetite parameters 
set by the Board. The Group Climate Director also 
supports management in the development of 
appropriate processes to monitor and report 
exposures to the risks arising from climate change 
and in benefiting from strategic opportunities 
arising from climate change.
The Board, through the GRC, ERC and GMC, 
has delegated oversight of the management 
of environmental risks to the GEC.
TCFD recommendations
Describe the Board’s 
oversight of climate-related 
risks and opportunities.
Describe management’s role 
in assessing and managing 
climate-related risks and 
opportunities.
Board oversight
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Additional information

Group Environment Committee (GEC)
The GEC met six times in 2023 in accordance with its 
annual plan. The GEC is chaired by the Group Climate 
Director with membership including: the Group CFO, 
Group HR Director, Group CRO, Group Corporate 
Affairs Director, LGRI CEO, LGC CEO, LGIM CIO and 
with the Head of LGIM’s Investment Stewardship 
team in attendance. The level of seniority in its 
membership and attendees helps ensure that there 
is a single forum to provide oversight on our response 
to environmental issues, ensures consistency, 
encourages debate and demonstrates the importance 
we place on our response to these issues. Below we 
refer specifically to climate risk; this will evolve to 
incorporate nature and biodiversity as progress is 
made to embed these into our frameworks.
The Group Climate Director has responsibility for 
oversight of climate risk identification and management 
for the Group. The role of the Group HR Director and 
the Group Corporate Affairs Director is to ensure that 
the management of climate risk is consistent with 
the broader group of corporate policies.
The Divisional CEOs ensure climate risk is embedded 
within their respective divisions. They are the ultimate 
owners of the risk, responsible for identifying, 
managing and monitoring climate-related risks 
and opportunities within the risk appetites agreed 
at the GEC.
To ensure a consistent group-wide approach and 
to support how we are implementing our ambitious 
strategy, the GEC has clearly defined relationships 
with other Group oversight committees. These 
interactions are designed to ensure that management 
of the risks and opportunities arising from climate 
change is integrated across the Group’s governance 
system and embedded into the existing risk 
management framework. 
The role of the GEC
The GEC is responsible for providing strategic 
direction of the Group’s environmental response, 
including to climate change, with reference to the 
Group’s broader strategy. This includes:
•	 setting the Group strategy for managing 
environmental impact; including setting targets, 
monitoring them and reporting on performance
•	 providing central oversight of the Group’s 
management of environmental impact to ensure 
that sustainability informs strategic planning 
and decision-making across all Group activities 
(including investments) 
•	 overseeing that management practices are in line 
with the Group’s risk appetite, our environment/
climate strategy and risk policy
•	 promoting internal awareness and understanding 
of environment-related risks and opportunities
•	 considering the transition and physical risks and 
opportunities associated with environment/
climate change and their potential impact on the 
Group’s assets and liabilities, in both the short, 
medium and long term.
These are demonstrated in the table opposite, which 
sets out the key activities of the GEC during 2023. 
The GEC is supported by Subcommittees to review 
and challenge performance against tolerances and 
targets, one for climate risk and one for other 
environmental opportunities and risks. It is further 
supported by working groups that focus on specific 
regulatory requirements.
Additional entity-specific governance is in place 
to provide oversight for clients’ investments.
GEC key decisions and discussions during 2023 
Metrics and 
targets
•	 Approved the approach to setting the Group’s scope 3 category 1 (purchased goods 
and services) SBT.
•	 Reviewed progress of commitments made against SBTs.
•	 Received detailed analysis of the carbon footprint of our business travel, to support 
identification of ways to reduce the carbon associated with how we travel for 
business purposes.
•	 Oversight of the progress of NZAOA target-setting. 
Assessing our 
exposure
•	 Reviewed our risk exposure to incorporate an assessment of nature-related risks, 
impacts and dependencies, in line with emerging market frameworks.
•	 Reviewed climate collaboration/ membership commitments. 
•	 Consideration of a near-term scenario analysis that we modelled.
Risk appetite
•	 Approved enhancements to our climate-related risk appetite and the supporting 
metrics and tolerances for our activity to deliver on our climate commitments.
•	 Reviewed and approved updates to the controls in place to manage our exposure 
to climate and nature-based risks.
Setting our 
strategy
•	 Set climate expectations within the strategic planning process.
•	 Completed a series of deep dives into how our divisions are delivering on their 
transition plans.
•	 Approved and oversaw our first Climate transition plan.
Oversight
•	 Regularly monitored the Group’s progress against our environmental commitments.
•	 Monitored the Group’s progress in responding to the emerging risks of 
climate change.
•	 Oversaw the audit of our emissions reporting for scope 1, 2 and 3 carbon emissions.
LGIM, as the investment management division, 
is the most material division from a governance 
and risk management perspective. In LGIM, ESG 
oversight is integrated within the existing governance 
and oversight structure. Specific ESG oversight 
requirements include delivery of portfolio ESG 
objectives, maintenance and application of the 
net zero framework and the coordination of ESG 
programmes alongside advising the LGIM Executive 
Committee on responsible investing matters. 
We have disclosed some specific further detail 
on legal entity governance on page 64.
Group environment governance
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Additional information

How is Legal & General’s climate and nature strategy 
responding to global trends?
Carl: More action is needed across the world if we 
are to have any chance of meeting the agreed 1.5°C 
warming target. The window is closing and we all 
have a role to support the necessary change. Last 
year was the hottest year on record and we saw 
increasingly severe natural disasters, including record 
prevalence of flooding and wildfires in some areas. 
But, there are positive global trends. We witnessed 
more than half of energy investment being made into 
clean energy, with the global deployment of solutions 
such as solar continuing to increase year-on-year. 
Legal & General has an important role to play. We 
continue to invest across a broad range of transition, 
technology and nature-based solutions. Some 
recent examples through our LGC division include 
increasing our investment in the Kensa Group (the 
UK’s leading ground source heat pump manufacturer 
and an LGC partner since 2020) by a combined 
£70 million, jointly with Octopus Energy, as well 
as others covering a huge breadth of transition 
technologies and enablers such as zero emissions 
cement, energy infrastructure and sustainable 
energy storage.
Nilufer: The Board is of the firm view that our 
climate strategy is set for the long term: lasting 
systemic changes are needed to deliver the 
transition. The Board continues to integrate the 
evolving opportunities and risks from the world’s 
response to climate into our business strategy. We 
continue to believe there will be long-term benefits 
from investing our capital in seeking to address 
climate change. Our strategy focuses on enabling 
these changes, for example through deploying 
institutional capital into sustainable infrastructure. 
What is important is for us to continue to prioritise 
those areas we can impact in terms of our 
contribution to the transition; we must continue 
to decarbonise in line with our public targets, 
continue to influence where we can, and continue 
to engage on climate and increasingly nature and 
biodiversity. No one should slow down because 
1.5°C is becoming harder. 
What were the key highlights in 2023 from a climate 
perspective and what are your plans for 2024?
Nilufer: In 2023, Legal & General continued to 
establish a leading voice through its stewardship team 
and made a number of exciting investments in the 
technological solutions and infrastructure required 
to decarbonise. Externally, COP 28 made some 
progress in achieving agreement to transition away 
from fossil fuels to achieve net zero by 2050 and to 
triple the world’s renewable energy capacity and 
double its energy-efficiency by 2030. However, 
the actual detail of how this will be achieved now 
needs to be worked out, and all the time the clock 
continues to tick…
For 2024, Legal & General remains committed 
and well positioned to play an important role in 
decarbonising the economy. Addressing climate 
change is embedded in the culture and core values 
of the whole organisation.
Carl: The year saw us continue to make positive 
progress towards all of our targets, including 
decarbonisation of our asset portfolio and emissions 
associated with our business, as well as obtain 
significant shareholder support in favour of our 
inaugural transition plan. We continue to challenge 
ourselves to ensure we do the right thing, for 
ourselves, and for future generations. The next step 
on our journey has been to set a supplier target to 
ensure that 80% of our suppliers, by spend, will set a 
science-based carbon reduction target by the end of 
2026 as well as further evolve our risk analysis and 
depth of understanding. 
Over the course of this next year, I am keen 
we continue to accelerate the positive impact 
Legal & General can make. As a global investor, 
we have a vital role to play in supporting the 
transition and in helping to protect nature. 
This is the first year you have incorporated 
nature into the report. Why is this?
Nilufer: The loss of nature, as well as climate 
change, impacts all of us every day; our customers, 
our shareholders, our employees, our suppliers, our 
regulators. Legal & General is committed to playing 
its part in supporting a shift in global financial flows 
toward nature-positive outcomes. Initially our focus, 
via LGIM, has been on engagement to encourage 
comparable disclosures that enable decision-
making, as well as understanding how firms are 
managing their risks so we can support capital 
flows into the solutions, while managing our risks.
Carl: There is increasing understanding that climate 
change can’t be addressed without addressing the 
wider state of nature; a transition to net zero depends 
on the natural world and the prosperity of nature 
depends on a successful transition. Neither can be 
addressed in isolation. Through our house building 
businesses and significant portfolio of commercial 
buildings, consideration of nature and biodiversity 
outcomes is important for us, along with the 
investment choices we make. We’ve already made 
some good progress by incorporating nature and 
biodiversity into our wider climate strategy and risk 
frameworks; and engaging with companies on these 
topics. We are supportive, and will adopt more widely, 
the TNFD over the coming years.
We continue to challenge 
ourselves to ensure we do 
the right thing, for ourselves, 
and for future generations.” 
Carl Moxley
Group Climate Director
The loss of nature, as well as climate 
change, impacts all of us every day... 
Legal & General is committed 
to playing its part.”
Nilufer von Bismarck
Non-Executive Director, with a focus on climate
Governance Q&A
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Metrics and targets
Additional information

Risk management
Our climate change risk management
A successful transition to a low-carbon 
economy will be underpinned by careful risk 
management, with the transition involving 
significant levels of uncertainty. Risk 
management enables us to enhance our 
resilience and competitiveness in the face 
of a changing world, where uncertainties 
beyond 2030 increase significantly.
Maasai Mara, Kenya 
Credit: Matthew Tigg  
Senior Marketing Operations Manager, London
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Additional information

We manage our business to align with the mitigation 
of climate change beyond the 1.5°C ‘Paris’ objective 
and to be resilient to the risks of different climate 
outcomes. Our key risk monitoring metrics are:
•	 investment portfolio economic carbon intensity
•	 operational footprint decarbonisation.
The risks from climate change represent another 
dimension of our existing risk exposures and are 
embedded in the way we manage these risks. 
Our governance structure is used to support the 
Group’s understanding and management of 
these risks.
The uncertain nature of the risks from climate change 
and the lack of historical data to support decision-
making, makes quantifying the risks more difficult 
than some other areas of our risk profile.
However, it is widely recognised that actions taken 
today will influence the likelihood of different climate 
outcomes and impact on future risk exposures. This, 
alongside climate scenario analysis, informs our risk 
management framework. Our scenarios chapter 
provides more detail about this analysis. 
These scenarios incorporate a longer-term time 
horizon into their analysis. Informed by this analysis, 
we have carried out a detailed assessment of how 
we could expect these risks to emerge across our 
business model.
Our risk landscape
The risks arising from climate change that we 
are exposed to fall into three broad categories:
Transition risks
Impacts on asset valuation and the economy 
from the process of transitioning towards a 
low-carbon economy.
Physical risks
Impacts on asset holdings or changes to insurance 
liabilities as a result of more frequent and severe 
weather events and longer-term shifts in climate.
Corporate risks
Impacts on the Group from exposure to regulatory 
censure, climate-related litigation risks, or adverse 
customer perception of the Group. This may be 
through loss of franchise value, directly through fines 
or costs due to adverse investor sentiment resulting 
from poor alignment with ESG rating expectations.
Climate change risks and wider environmental risks 
will emerge through our current risk exposures and 
the relevant Group policies set out our approaches 
to identifying, assessing, measuring, managing and 
monitoring these risks.
TCFD recommendation
Describe how processes for 
identifying, assessing and managing 
climate-related risks are integrated 
into the organisation’s overall risk 
management.
Risk management framework
Internal risk management landscape 
(risks and strategy)
External risk management landscape 
(impacts and considerations)
External drivers
Scientific 
understanding
Policy and regulation
Market demands
Environmental 
solution innovation
Global 
decarbonisation 
progress
Weather events
Climate sentiment
Climate risk 
categories
Transition risks
The move to a 
low-carbon economy
Physical risks 
The direct impacts of 
a warming world on 
assets and liabilities
Corporate risks
Reputational and 
regulatory risks/ fines
Climate strategy
Invest
•	Reducing the 
intensity of our 
financed emissions
•	Investing in the 
transition
Influence
•	Products we offer
•	Active engagement 
Operate
•	Our operations
•	 Businesses we control
•	Our purchased goods 
and services
Our external focus
Climate science
Time horizons
Sectoral pathways
Climate scenarios
 
Measurement
 
Identification
 
Monitoring
Risk  
management 
actions
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Additional information

Our approach to risk identification
TCFD recommendation
Describe the organisation’s 
processes for identifying and 
assessing climate-related risks.
Type of risk
Possible effects arising from climate change and nature-loss 
From the products we write
Longevity (for annuities) 
More extreme climate events may lead to changes in life expectancy and thus impact our assumptions. These changes will emerge gradually as the effects 
are experienced or through increased certainty around future climate pathways and the associated health impacts. 
Mortality/ morbidity (for life/ 
health insurance) 
Similar to longevity, the impacts will emerge gradually, so our future assumptions will be impacted before there are material changes in the number of claims.
Reinsurance counterparty 
While we would not expect climate change to pose significant risk to our short-term counterparty exposures it may impact long-term reinsurance 
counterparties, who are likely to have a similar exposure to the prudential risks as outlined under longevity and mortality/ morbidity above as well as being 
further exposed to the physical risks due to their property and casualty businesses. This could change our assessment of the counterparty risk.
From the investments we hold 
Market
May cause changes to asset values, asset returns and other market risk exposures, such as: 
•	
equity and property risk through asset values being exposed to a (potentially sudden) repricing to reflect transition risks to a low or carbon-neutral economy, 
or due to more frequent and severe weather events and longer-term shifts in climate impacting on asset values, either through actual experience or changed 
anticipated future experience 
•	
possible enhanced asset returns, e.g. in increased equity valuation for a firm enabling the transition to a low-carbon economy 
•	
other macroeconomic factors such as interest rates, inflation and foreign exchange rates.
Credit
May cause movements in credit spreads and credit rating transitions:
•	
credit spread movements due to similar processes as those driving changes in the equity valuation described above 
•	
credit rating transitions due to changes in either actual or anticipated default rates.
Client funds
May impact all client funds which are exposed to risks from climate change. Note, that it is our clients who ultimately choose specific mandates and bear 
the risks; but we can have a positive impact by helping them to take action on climate/ environment change, via disclosure of climate metrics and assessment 
of the implications of climate change on their assets, or offering products with reduced exposure. Client actions can reduce our potential for positive impact.
From the environment we operate in 
Our operations
We have direct exposure to climate change through our operational carbon footprint and the supply chain that supports it. This may be through physical 
impacts on our operations and offices, or through transitional risks impacting on our operational processes and costs. This could impact our ability to meet 
our operational decarbonisation targets. 
People, processes, systems 
and external events
As we change how we invest and operate and the products and services we offer, we must ensure we have the right skills for the future and update our systems 
and processes to incorporate climate change considerations. Our commitments assume governments will implement required policy changes; the firms we 
invest in will deliver their targets; and there will be societal change on an unprecedented scale over the next decade. 
•	
Weakness or failure in our systems and processes or the loss of key personnel could result in financial loss, customer detriment or reputational damage. 
•	
Failure by governments and other firms to deliver on their targets will impact our ability to deliver on ours. 
Evolving regulation and legislation
We operate in highly-regulated markets and the regulatory approach continues to evolve. New interpretations of compliance expectations could require 
changes to our products or business processes. This may expose us to financial penalties, remediation costs or reputational damage.
Evolving sentiment
Sentiment is often subjective and our approach might fail to resonate with all stakeholders. This may expose us to reputational/ greenwashing risk.
Focusing on transition risk
We focus on transition risk because 
successful delivery of ‘Paris’ implies 
a fundamental change to the global 
economy in the short term. We think 
this is the key near-term issue and 
source of risk for our business, 
specifically for our investment portfolio. 
Physical risks are still important, but 
as our insurance liabilities are not 
linked to losses due to damage of 
any underlying asset, these risks 
are mostly in relation to some of 
our assets and our operations.
We have integrated climate risk management into our existing risk and governance framework and have carried out a detailed assessment of how we could expect climate risk to 
emerge across our business model. Nature-related risks will also have an impact and we are building on our integration of climate risk to incorporate these. We regularly review our 
approach to climate risk identification to ensure our risk management remains appropriate and proportionate to the underlying risks. The risks from climate change and nature-loss 
are far-reaching, uncertain and broad-ranging. As much of our balance sheet is based on assumptions and expectations of future experience, risks can materialise through both 
actual change in experienced profits or losses, as well as changes in those future expectations. 
Legal & General Group Plc Climate and nature report 2023
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Materiality assessment
Our risk management approach to the financial risks 
arising from climate change reflects our strategy, 
the materiality of the exposures and how we operate. 
When assessing materiality, we consider both how 
the Group is affected by climate change, as well 
as the Group’s own impact on the climate.
The effect of future uncertainty over climate change 
pathways is that the evaluation of climate-related risks 
and impacts has a high degree of estimation uncertainty, 
with a wide range of reasonable outcomes greater than 
our materiality for the Group’s financial statements 
as a whole and possibly many times that amount.
Our scenario modelling enables us to assess how 
the impacts from climate change may emerge under 
a range of climate scenarios and time horizons. 
Given our business model, we assess the most material 
financial risks from the potential impact of climate 
change on the value and credit rating of our assets.
As detailed in the scenarios chapter, we have invested 
in our capability to develop possible transition 
pathways to differing temperature warming outcomes. 
The scenarios presented show potential portfolio 
impacts under a given scenario. They are not 
forecasts or predictions, nor are we saying they are 
equally likely. However, these scenarios do inform our 
understanding of transition risk, identifying sectors 
where the transition is likely to be more disruptive 
and the potential timelines associated with the shifts.
As a signatory of the PRI, we also monitor the 
progress of the Inevitable Policy Response (IPR) 
scenario work, alongside other bespoke scenarios.
Measurement
Climate transition risks are primarily measured in 
relation to our carbon exposures. We are committed 
to reducing the carbon footprint of both our 
operations (scope 1 and 2) and of our investment
portfolio GHG emissions intensity to align with the 
‘Paris’ 1.5°C objective.
Investment portfolio carbon
We measure the contribution of our investments 
to CO2e emissions, calculating portfolio economic 
carbon emission intensities at both Group and 
divisional level.
Through our climate scenario analysis, we measure 
the risks to assets and liabilities. This is measured 
through the impacts on equity and bond valuations 
and credit ratings, in each scenario.
Assessment of our investment portfolio is dependent 
on good quality comparable cross-industry data and 
disclosures of climate-related metrics and impacts. 
This enables us to steer our investments successfully, 
identify and manage risks, deliver on our climate 
ambition of decarbonising our portfolio and comply 
with our own disclosure objectives. We are supportive 
of the need for global consistency with regards to 
reporting, disclosure and labelling.
Operational footprint
We measure and monitor the direct carbon 
emissions of all of our operational businesses. We 
have set SBTs covering our scope 1 and 2 operational 
emissions. These targets have been verified by the 
SBTi and we monitor progress made towards these.
Management actions
We deploy a range of management actions to 
manage our exposure to climate-related risks 
associated with our investments and operations, 
to meet our risk management objectives, including:
1.	 established framework for climate commitments
2.	 exclusions and high-carbon escalation
3.	 physical risk controls 
4.	 review our existing tolerance framework 
to incorporate climate considerations
5.	 active engagement.
1. Established framework for climate commitments
Achieving our Group commitments will be 
challenging, reflecting the complexity of addressing 
the systemic issue of climate change. Due to the 
transformational nature of a successful net zero 
transition, strong partnerships are needed to support 
a common vision and long-term objectives. Our 
climate collaborations can be found in the strategy 
chapter on page 14.
Our framework accounts for all GHGs and covers 
scope 1, 2 and material scope 3 emissions (see page 
38). Our progress and long-term goals are supported 
by annual and interim targets to enable regular 
monitoring of progress towards our commitments. 
These commitments are supported by our transition 
plan, against which progress is reviewed and publicly 
reported on at least annually and overseen by the 
GEC. Our commitments are consistent with the 
latest science and are credible and achievable. 
Our commitments are made in the expectation that 
governments will deliver on their own commitments 
and required policy actions to ensure they remain 
aligned to ‘Paris’.
2. Exclusions and high-carbon escalation
Our risk management approach recognises the 
importance of engagement with investee companies. 
Our Investment Management Agreements (IMAs) 
with LGIM, have climate-specific clauses that enable 
us to manage our targets, including exclusions that 
focus on key areas of transition risk (such as coal and 
oil sands activity and unconventional drilling and CIP 
exclusions). In 2023, the IMAs were amended to 
enable collaborative management against climate 
targets. We also take account of the broader energy 
system within our portfolio management approach 
– through our high-carbon escalation process.
High-carbon escalation
Our escalation process for all proposed individual 
stock investments where the carbon intensity is 
greater than a defined threshold across relevant 
sectors continues to work well. This acts as an early
warning system and a degree of control over the 
accumulation of risk through time.
Issuers continue to be assessed on a range of criteria 
including our assessment of the underlying transition 
and physical risks. Our approach recognises that oil 
and gas will follow different phase-down pathways, 
taking particular assessment of unconventional 
oil and gas production (such as Arctic oil) and that 
counterparties’ own transition plans will impact on 
our assessment of the underlying risks. 
The escalation process has had a real impact. 
In 2023, 12 new issuers (out of 34 considered) 
were added to the exclusions list, increasing the 
total number of exclusions through this escalation 
process to 26.
The escalation process is also supported by 
exclusions, listed below, where there is a clear 
incompatibility with the 1.5°C ‘Paris’ objective:
Climate Impact Pledge (CIP) exclusions
Our CIP calls out stocks it excludes from the Future 
World fund range. LGIM publicly sets out minimum 
standards, which if not met, may translate into 
firm-wide voting sanctions and divestment 
consequences for the funds adopting the CIP 
exclusions. These additional exclusions are applied 
to the Group’s proprietary assets managed by LGIM. 
We typically engage with a company for 12 months. 
If we still have concerns about the company’s 
actions or strategy, the relevant business and asset 
managers agree a course of action. Companies 
in the current CIP exclusion list are added to the 
Group’s own investment exclusion list, helping 
to drive change in the market by supporting our 
engagement with the use of the Group’s own 
balance sheet capital. This list is reviewed annually. 
The rule applied to an excluded stock for these 
assets is ‘Do not buy’.
Risk management approach
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Coal and oil sands activity
We recognise that coal’s role in the current energy 
mix is incompatible with the 1.5°C ‘Paris’ objective, 
which is why our fossil fuel policy focuses on this 
sector. We continue to evolve our coal and oil sands 
policy, with the current details set out opposite.
Building on LGIM’s coal policy, we have investment 
exclusions on those companies that have a material 
proportion of their revenue from the mining and
extraction of thermal coal, from coal-based energy 
production, or from oil sands. Within our own balance 
sheet, we are targeting exiting the existing financing 
of companies involved in coal mining or coal power 
generation by 20304.
Given the historical role of coal in the global energy 
system and the size of our investment portfolio, we 
have c.£3.2 billion of exposure to companies, mostly 
utility companies, within our proprietary assets, which 
report that some aspect of their revenue is linked to 
coal. Where coal-related activity makes up more than 
10% of the relevant company’s revenue, this reduces 
to c.£0.6 billion. Our retirement businesses partially 
sold down their legacy exposures to issuers with 10% 
or more of their revenue linked to coal, reducing this 
by c.£0.6 billion over 2023. We do not have any 
significant exposures to oil sands.
Direct investments in energy infrastructure projects
We will not invest in new oil, gas and associated 
energy infrastructure projects, which are not aligned 
with a 1.5°C scenario pathway in line with the NZAOA 
oil and gas position5.
Deforestation
We have developed and will continue to evolve our 
investment deforestation policies. We have in place 
exclusions in relation to violators of the UN Global 
Compact standards which include deforestation 
controversies and we maintain exclusions of names 
called out as engagement laggards through the CIP, 
where an insufficient zero deforestation policy, 
amongst other climate considerations, has led to an 
exclusion restriction. We will continue to leverage the 
activities of LGIM’s stewardship and engagement 
approach as set out in the LGIM deforestation policy6 
to engage on this topic.
3. Physical risk controls 
Where specific investments pose an unacceptable 
exposure to physical risk we deploy tools such as 
physical risk modelling, categorisation of exposures, 
incorporation into the underwriting process and clear 
exposure limits. We have developed and will continue 
to evolve our approach for limiting exposure to 
physical risks across the different geographies in 
which the Group is active. 
4. Review our existing tolerance framework 
to incorporate climate considerations
The risks from climate change represent another 
dimension of our existing risk exposures. To ensure 
that these considerations are integrated across the 
Group’s governance system, our existing framework 
is regularly reviewed and updated. For example we 
now also extend our fossil fuel exclusion policy into 
relevant new contractual documentation
for reinsurance transactions.
5. Active engagement
Alongside close monitoring of the political and 
regulatory landscape, an important part of our 
strategy remains to engage with policymakers, 
regulators and investee companies in support of 
climate action. This benefits our own stakeholders, 
the wider market and society. This is actively pursued 
by LGIM on the Group’s behalf, with climate change 
continuing to be a key topic of engagement.
Risk management approach
continued
Coal and oil sands policy
Where we (via LGIM) invest on behalf of others1
Where we have direct investment control
Legal & General Investment Management (Holdings) 
Limited and its subsidiaries will exclude from 
investments those companies that are involved in the 
mining and extraction of thermal coal as set out below.
Coal mining
Screening will be carried out and exclusions will be 
applied to those companies that generate 20% or more 
of their revenues from coal mining and extraction.
•	
No new investments in issuers with more than 
15% revenue exposure2. Exclusion trigger is 
expected to decrease to 5% by 2030 with the 
intention to phase-out legacy investments in issuers 
with more than 5% revenue exposure by 20303.
•	
No investments in new coal mining and no further 
investment in companies that are investing in new 
coal capacity3. 
Coal power generation
Screening will be carried out and exclusions will be 
applied to those companies that generate 20% or more 
of revenues from coal-fired power generation.
We retain the ability to invest where a company has set 
out a clear ‘Paris’-aligned plan to phase-out coal by 
2030 in OECD countries and by 2040 in non-OECD 
countries. We retain the ability to fund specific issuing 
entities, where a company has non-coal subsidiaries. 
•	
No new investments in issuers with more than 
20% revenue exposure.
•	
Exclusion trigger is expected to decrease to 5% 
by 2030 with the intention to phase-out legacy 
investments with more than 5% revenue exposure 
by 20303.
•	
No new investments in companies with over 
10GW absolute coal capacity2.
•	
No new investments in new coal plants and no 
further investment in companies that are investing 
in new coal capacity3.
Oil sands
Screening will be carried out and exclusions will be 
applied to those companies that derive more than 20% 
of revenues from oil sands (sand and rock material 
that contains crude bitumen).
•	
No new investments in issuers with more than 
5% revenue exposure.
We will continue to evolve our approach to investment restrictions on coal, setting our trajectory towards 
phase-out investments in coal by 2030 and ceasing investments in companies that generate 5% or more 
of revenues from coal and are investing in new coal capacity4.
1.	 www.lgim.com/landg-assets/lgim/_document-library/
capabilities/lgimh-coal-policy.pdf
2.	 This is tracked via relevant third-party data with differing 
reliability – an area which remains challenging for asset owners.
3.	 Aligned with SBTi and NZAOA coal phase-out expectations.
4.	 www.unepfi.org/wordpress/wp-content/uploads/2020/11/Net-
Zero-Asset-Owner-Alliance-Thermal-Coal-Position.pdf
5.	 www.unepfi.org/wordpress/wp-content/uploads/2023/03/
NZAOA-Position-on-the-Oil-and-Gas-Sector.pdf
6.	 www.lgim.com/landg-assets/lgim/_document-library/esg/
lgims-deforestation-policy---0823-update_v0.4.pdf
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Distribution of high risk properties 
(HRP2,3)
2050
HRP number
0
10
20
30
40
50
60
70
80
Climate Impact Pledge (CIP)
Through LGIM’s dedicated engagement programme, 
the CIP, we continue to be committed to helping 
companies step-up on their climate change and 
nature-related commitments, build resilient 
strategies for this transition period and succeed in 
the low-carbon world. Launched in 2016 in response 
to the ‘Paris’ Agreement, we have expanded the 
coverage to include 20 ‘climate critical’ sectors, with 
voting and potential divestment sanctions for the 
companies that do not meet our minimum standards.
Given the important connections between climate 
change and nature, the CIP also incorporates 
expectations around biodiversity and, for relevant 
sectors, deforestation. We discuss how this forms 
a part of our strategy on page 14, and disclose our 
metrics on page 42.
Our targeted approach, using voting and investment 
sanctions to encourage companies to step up on 
sustainability, has contributed to companies making 
improvements to their climate targets and strategies. 
This has significant risk management benefits.
Global research and engagement groups (GREGs)
During 2023, work continued within the GREGs, which 
bring together our experts from our investment and 
stewardship teams, to research and identify the 
challenges and opportunities across sectors and 
asset classes stemming from key sustainability 
issues, including climate change. 
Risk management approach
continued
Monitoring
Monitoring and updating our measurements and 
management actions over time is a critical activity 
enabling the risk management framework to 
adequately capture the extended time horizons 
associated with climate risks. Our understanding 
of the risks from climate change and the actions that 
are needed to mitigate it, are based on science. 
This continues to evolve. The actions that the world 
is taking will to some extent inform the actions that 
we can take. Climate reporting is an evolving process 
and remains a ‘best endeavours’ analysis. Through 
our own work, we continue to progress in our 
understanding and quantification of climate risk, 
but we believe we are still early in our development. 
This is more significant when we consider nature risk.
While convergence has increased over 2023, it is still 
not yet completely clear where the financial sector 
will fully align on metrics, calculation methodology, 
time frame and scenario definition. While we monitor 
and disclose our metrics, the underlying 
methodologies evolve, reflecting the availability and 
quality of data, regulatory expectations and emerging 
industry practices.
Our business entity-level risk management
Group-level climate risk management is cascaded 
down to all our businesses via the divisional 
committee structures. Where appropriate the senior 
leaders from the divisions are members of the GEC, 
ensuring adequate oversight at this level. LGIM, as 
the investment management division, is the most 
material division from a governance and risk 
management perspective. Our Workplace and Retail 
Savings businesses and retirement businesses 
engage with LGIM as their primary asset manager, to 
obtain climate data and to conduct scenario analysis. 
This information is an integral part of their risk 
management process and an area in which our 
individual businesses expect to continue to develop 
their understanding of over time. Specific further 
entity-level disclosures are on page 64.
Flood risk analysis
Flood risk has always been embedded 
in our investment strategy and is a key 
component of our standard due diligence 
process of all property acquisitions 
through LGIM Real Assets. However, over 
the last few years we have worked with 
physical climate risk experts, XDI and 
Marsh, to understand how our climate 
risk exposure may change in the future 
under different warming scenarios. 
An assessment of eight different climate 
hazards has demonstrated that flood risk 
is the most significant physical climate 
hazard for our UK-based real estate 
portfolios, both now and in the future1.
In 2022, all real estate equity assets 
were included in a high-level, forward-
looking flood risk assessment process. 
The granularity of this analysis was 
enhanced by using Unique Property 
Reference Numbers (UPRNs), enabling 
analysis of assets at the individual 
building level. A preliminary risk scan 
identified those assets requiring further 
review and in 2023, asset specific 
information, including building age, 
floor height and, crucially, any existing 
flood adaptation measures, was captured 
across higher risk assets. This additional 
detail will allow us to develop more 
targeted adaptation strategies for assets 
which are still deemed to be at risk.
1.	 Eight climate hazards assessed are: river flood; surface water flood; coastal inundation; extreme wind; 
wild fire; freeze thaw; soil movement; extreme heat.
2.	 A high risk property (HRP), is considered as a UPRN with a Value-at-Risk percentage over 1%, a relative 
metric derived from the replacement cost of a representative asset. 
3.	 This data covers real estate equity properties in the portfolio as at Q3 2023 and uses a Representative 
Concentration Pathway (RCP) 8.5 ‘business as usual’ scenario by the IPCC.
TCFD recommendation
Describe the organisation’s 
processes for managing 
climate-related risks.
Legal & General Group Plc Climate and nature report 2023
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Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information

Metrics 
and targets
Measuring our progress
Our climate and nature-related metrics 
and targets support the development of 
consistent and comparable information 
over time and between market participants. 
These disclosures also enhance transparency 
and accountability for our climate actions, 
as well as demonstrating performance 
against our longer-term commitments.
Glacier National Park, USA 
Credit: Alice Measom  
Talent Acquisition Specialist, Chicago
Legal & General Group Plc Climate and nature report 2023
Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information
36

Metric
Meaning
Target
Progress against our base year
Operational 
carbon 
footprint
This covers the operations we 
directly control, such as the energy 
in our occupied offices, the energy 
from our landlord activities and 
our housebuilding, as well as the 
construction of new homes1.
•	 Net zero by 2050.
•	 We will reduce our absolute scope 1 
and 2 GHG emissions by 42% by 2030 
from our 2021 base year2.
•	 Occupied offices and business travel 
operating with net zero emissions 
from 20301.
•	 Enable all new homes we build from 
2030 to be capable of operating with 
net zero carbon emissions.
30,062
27,722
38,982
0
10,000
20,000
30,000
40,000
Operational carbon footprint (tCO2e)  
20212
2022
2023
GHG 
emissions 
intensity 
of our 
investments
This is made up of our ownership 
share of the emissions related 
to the assets we invest in within 
the Group proprietary asset 
portfolio, as explained on page 10. 
It includes equities and bonds, but 
not cash, derivatives, or any assets 
already covered in our operational 
footprint. It is measured per unit 
of investment.
•	 Net zero asset portfolio, in line with 
a 1.5°C ‘Paris’ objective by 2050.
•	 By 2030, reduce portfolio GHG emission 
intensity by 50%3.
•	 By start of 2025, reduce portfolio GHG 
emission intensity by 18.5%3.
•	 By end of 2023, reduce portfolio GHG 
emission intensity by 18%3.
•	 More granular SBTs on page 40.
62
56
80
0
20
40
60
80
100
Investment portfolio GHG emission intensity
(tCO2e/£m)  
20194
20224
2023
Implied 
portfolio 
temperature 
alignment
This measures the implied 
warming potential of the Group 
investment portfolio aggregated 
from its individual components, 
as calculated in line with LGIM’s 
methodology.
•	 Please see our portfolio temperature 
rating SBTs on page 41 for related 
targets.
2.6
2.5
2.6
2.4
2.5
2.6
2.7
Implied portfolio temperature alignment (°C)  
20214
20224
2023
This chapter focuses on the key metrics we use 
to measure our progress against our climate 
commitments. These are integral to our business 
strategy and risk management framework.
We continue to disclose metrics for our key 
operational commitments and targets which cover 
wider environmental issues (such as waste and 
water management). We have considered how we 
can best measure our nature-related impacts and 
dependencies, but note that there is still a significant 
amount of work required throughout our sector, to 
properly understand and quantify these issues.
1.	 Applies to occupied offices where we actively control the management of utilities.
2. 	 This is our 2021 SBT base year which includes our LGIM Real Assets 2019 data to account for the impact of the pandemic.
3.	 From a 2019 base year.
4.	 Metrics have been re-baselined through a combination of methodology and data sourcing changes. Figures from the 2022 report, with an associated impact assessment, are provided in the appendix.
Scope 1: direct GHG emissions. 
Scope 2: indirect GHG emissions from 
consumption of purchased electricity, 
heat or steam. 
Scope 3: other indirect emissions not 
covered in scope 2 that occur in the value 
chain of the reporting company.
TCFD recommendations
Disclose the metrics used by the 
organisation to assess climate-
related risks and opportunities 
in line with its strategy and risk 
management process.
Describe the targets used by the 
organisation to manage climate-
related risks and opportunities and 
performance against targets.
Metrics and targets summary
Legal & General Group Plc Climate and nature report 2023
Introduction
Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information
37

Operational
carbon footprint
Methodology
Our operational carbon footprint is comprised of 
the annual carbon emissions of the whole Group, 
including our subsidiaries and joint ventures1. We 
apply the operational control approach, we include 
all operations which we directly control, such as the 
energy from our core occupied offices (applies to 
occupied offices where we actively control the 
management of utilities), landlord activities, as well 
as the construction of new homes within our housing 
businesses and joint ventures1. The emissions data 
reported in Table 4 is aligned to the Group’s financial 
reporting period unless otherwise stated2. Please 
refer to our Basis of Preparation on pages 56 to 57 
for details of how we collate GHG data for our 
operational carbon footprint.
Progress in 2023
Our operational scope 1 and 2 (location) carbon 
footprint has decreased by 8% from 2022. This is 
an absolute reduction and as outlined below is due 
to changes in our operational businesses as well 
as energy efficiency measures delivered.
Occupied offices
During 2023 we began implementation of our 
new location strategy, which we are shaping to align 
with our transition plan. The most impactful action 
in 2023 was the occupation of our new office in 
Cardiff where we have aligned with the latest UKGBC 
guidance and are aiming for a 5 stars NABERS rating 
and have achieved BREEAM ‘Outstanding’.
As anticipated our business travel increased in 
2023 and we are working with our travel providers 
to identify longer-term solutions to help us achieve 
our 2030 ambition, noting that we expect our 2024 
business travel to increase in the short term. 
Real Assets 
Our real estate portfolio’s scope 1 and 2 emissions 
has decreased by 20% (from 2022), due to changes 
in the composition of funds across the platform and 
the implementation of energy and carbon reduction 
programmes for all assets that we manage, as well 
as ongoing engagement with our occupiers to help 
drive energy reductions.
LGC 
Our LGC footprint has increased by 10% from last 
year. This is a lower increase than we modelled in 
setting our SBTs, and we expect our LGC footprint 
to increase in the short term, due to planned growth 
of our housing businesses. 
The movement this year was driven by the slowing 
down of our Modular Homes business, and the 
successful roll-out of HVO by our largest house 
builder, keeping the increase less than anticipated. 
This was offset by the inclusion of Ancora’s 
emissions and our housing businesses’ growth.
Table 4. GHG emissions data
In reporting our operational carbon footprint, we have sought independent limited assurance from Deloitte 
over the 2023 metrics identified below with a *. Deloitte’s assurance statement is available on pages 51 to 52. 
Emissions source2
tCO2e
20213
tCO2e
2022
tCO2e
20234,5
Scope 1 and 2 (location)
38,982
30,062*
27,722*
Scope 1
– UK
– International
15,559
15,534
25
12,506*
12,408
98
10,158*
9,452
706
Scope 2 – location
– UK
– International
23,423
22,604
819
17,556*
16,649
907
17,564*
14,349
3,215
Scope 2 – market
– UK
– International
2,432
1,613
819
2,586*
1,679
907
4,215*
1,000
3,215
Fugitive emissions (included in scope 1)
127
293
216
Scope 36
Category 3: Fuel and energy-related activities
Category 5: Waste
Category 6: Business travel
Category 7: Employee commuting (home working)
Category 8: Upstream leased assets (serviced offices)
Category 13: Downstream leased assets7
Category 15: Investments7
8,607
486
2,070
3,025
371
0.4m
6.2m
8,301
400
5,467*
4,739*
306*
–
5.0m
7,325
483
7,631*
4,568*
304*
0.3m
5.0m
Scope 1 and 2 intensity ratio 
tCO2e emissions per employee
3.6
2.6
2.3
1.	 Joint ventures are included in our footprint where we are the majority shareholder, or have operational control.
2. 	 Please refer to our Basis of Preparation on pages 56 to 57 for details of how we collate out GHG data for our operational carbon 
footprint.
3.	 This is our 2021 SBT baseline which includes our LGIM Real Assets 2019 data to account for the impact of the pandemic.
4.	 We purchased Taylor Lane, a timber frame construction specialist in H2 2023, due to limited access to robust datasets this has been 
excluded from our 2023 footprint and will be included from 2024. Noting, this does not have a material impact on our overall footprint.
5.	 Deloitte have provided independent limited assurance in accordance with the International Standard for Assurance Engagements 3000 
(‘ISAE 3000’) and Assurance Engagements on Greenhouse Gas Statements (‘ISAE 3410’) over the selected metrics identified with a *. 
Deloitte’s full unqualified assurance opinion, which includes details of the selected metrics assured, can be found on pages 51 to 52.
6.	 See our scope 3 coverage on page 59.
7. 	 Our 2021 and 2022 metrics have been rebaselined through a combination of methodology and data sourcing changes. Figures from 
the 2022 report are provided in the additional information chapter.
TCFD recommendation
Disclose scope 1, scope 2 and, 
if appropriate, scope 3 GHG 
emissions and the related risks.
Reporting framework
In calculating our footprint we have reported on 
the emission sources required under the Companies 
Act 2006 (Strategic report and Directors’ report) 
Regulations 2013 and have followed the requirements 
of the Streamlined Energy and Carbon Reporting 
(SECR) framework.
The GHG emissions data is reported in line with 
the Greenhouse Gas Protocol Corporate Accounting 
and Reporting Standard ‘operational control’ method 
and emissions factors for fuels and electricity are 
published at: www.ghgprotocol.org/sites/default/
files/standards/ghg-protocol-revised.pdf
Legal & General Group Plc Climate and nature report 2023
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Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information
38

GHG emissions intensity  
of our investments
Our financed emissions, generated within our 
investment portfolios and classified as scope 3 – 
(category 15 (investments)), creates the largest 
contribution to our carbon footprint. We have 
implemented targets that support our commitment 
to align with a 1.5°C ‘Paris’ objective.
Methodology and data approach
Our primary metric is the GHG economic emissions 
intensity of our portfolio of Group proprietary assets. 
This is the total of all the GHG produced by our share 
of the organisations that we invest in, per unit of 
investment, and is reported using CO2e emissions 
data. There are three components to this metric:
1.	 the scope 1 and 2 GHG emissions, CO2e, in 
tonnes for each entity in which we are invested
2.	 a unit of value to normalise the emissions by the 
underlying size of the entity we are investing in, 
measured per £ million (£m). For our primary 
metric we use:
–	 EVIC for corporate issuers
–	 sovereign capital stock for sovereigns
–	 market valuation for each real asset investment
3.	 the size of our holding in the entity.
The investment portfolio emissions intensity is then 
calculated by weighting the normalised emissions 
(tonnes of CO2e emissions per £m normaliser entity 
value as defined above) by the size of our investment 
and aggregating all holdings in our investment. We 
have applied the emissions data equally to equities 
and bonds as they are both used by corporates to 
raise capital and fund the business. Please refer to 
pages 58 to 63 for further detail on the methodology, 
including the data sourcing and application of the 
underlying data used in these metrics. The 
Partnership of Carbon Accounting Financials (PCAF) 
Data Quality score is also provided as a summary 
metric around the use of proxy data.
Progress in 2023
Table 5 shows the end 2023 Group investment 
portfolio GHG emission intensity score of 56 tCO2e/£m 
invested (-9% in 2023; and -30% from the 2019 base 
year). When applied to the £90.0 billion of assets in 
this analysis, this gives an absolute footprint of 5.0 
million tCO2e emissions (2022: 5.0 million tCO2e)1,2.
Within the annual movement in 2023, 12% is 
attributed to the change in updated portfolio 
emissions (from updated company emissions 
disclosures, and from trading activity) by holding 
EVIC constant, as shown in the table to the right. 
This movement is in part due to small sector 
allocation updates and associated trading through 
the year within the high emission sectors, taking us 
further beyond our projected pathway. 
A partial reversal of this movement is then attributed 
to changes in the EVIC of the investments in 2023, 
illustrating the impact that market movements can 
have on economic emission intensity metrics.
Tables 6 and 7 show the large contribution to the 
overall score from bonds in the utility sector.
Table 5. Group investment portfolio GHG emission intensities
tCO2e/£m
Measure
20221,2
2023
(constant EVIC)
2023
Investment portfolio economic carbon intensity
62
54
56
Reduction from 2022 – actual (%)
(12)
(9)
Reduction from 2019 – actual (%)
(23)
(32)
(30)
Reduction from 2019 – target (%)
 
(18)
PCAF Data Quality Score
2.5
Investment portfolio economic carbon intensity ex sovereigns
59
52
Investment portfolio weighted average carbon intensity 
(WACI) (tCO2/USD million revenues)
151
127
Table 6. Portfolio GHG emission intensities breakdown by asset class
Score breakdown
By value (%)
Standalone 
emissions 
intensity
By emissions 
intensity 
contribution (%)
PCAF
data quality
Bond
90
60
97
2.5
Property
9
16
2
2.6
Equity
1
31
1
2.7
Total
100
56
100
2.5
Table 7. Portfolio GHG emission intensities breakdown by sector
Score breakdown
By value (%)
Standalone 
emissions 
intensity
By emissions 
intensity 
contribution (%)
PCAF
data quality
Utilities
12
 200 
40
2.5
Energy
4
209 
16
2.5
Materials
1
 251
4
2.1
Industrials
6
 62 
7
2.7
Government
11
 89 
16
1.4
Other
66
13
16
2.7
Total
100
56 
100
2.5 
Use of proxy data
Where third-party data is not available, we have 
adopted several proxy approaches with the aim of 
filling the coverage gap. For some key asset classes, 
asset class-specific approaches are employed, while 
for others that are not covered in our datasets, we use 
sector-based proxies. Proxy approaches are used for 
the following other asset classes: real assets, lifetime 
mortgages, private debt and private equity. See the 
additional information chapter for further detail on 
the data and material proxy methodologies utilised.
1.	 This relates to the investments within the £90.0 billion of Group proprietary assets qualifying as scope 3 investment emissions. 
The emissions for the additional £2.5 billion of operating assets are captured in the operational footprint.
2.	 Metrics have been rebaselined through a combination of methodology and data sourcing changes. Figures from the 2022 report, 
with an associated impact assessment, are provided in the appendix.
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1.	 www.sciencebasedtargets.org/resources/files/Financial-
Sector-Science-Based-Targets-Guidance.pdf
GHG emissions intensity of our investments
continued
Mid- and long-term trajectories
While we remain ahead of our year end 2023 target 
reduction from 2019, we may still see further volatility 
from changes in the global economy, as explained 
below. We remain focused on our long-term 
decarbonisation targets and the interim milestones, 
including our end 2024 target shown on Chart 13.
In any one period, the portfolio GHG emissions 
intensity is impacted by changes in the following:
•	 organic changes in the emissions from the 
entities we invest in (noting that the available 
data generally relates to emissions for the 
previous year for corporate issuers, with 
greater lags for sovereign emission data)
•	 the underlying size/ revenues of the 
company or corresponding sovereign metric
•	 the market value of our holdings
•	 changes in methodology.
Changes in the emissions coming from our 
investments and our investment activity are key 
to decarbonising our portfolios in the medium 
and longer term. However in the short term, factors 
outside of our control, such as the carbon outcomes 
of the entity, market movements, and the lag in the 
reporting of the underlying emission data, have the 
potential to create significant volatility in the 
calculated metrics. We try to identify the underlying 
trends through techniques such as holding the 
company size constant over the reporting year, 
as seen in Chart 13.
Changes in methodology are, and will be, addressed 
through considering results on an unchanged basis, 
as well as using estimates where actual data 
is not available. Further detail is given in the 
additional information chapter.
Science-based targets (SBTs)
Last year we announced our SBTs which have been 
independently validated by the SBTi.
In line with this commitment, we have started 
to track the associated physical carbon intensity 
metrics, whereby the emissions are normalised 
by a measure of physical output, for certain asset 
class and sector subsets of the portfolio, in line 
with SBTi requirements1.
Our performance to date within our electricity 
generation project finance and real estate equity 
investment portfolios is given in Table 8.
Our associated Portfolio Temperature Rating targets 
are given on page 41.
Chart 13.
Model period
Target decarbonisation pathway
Progress
Fixed EVIC % movement
100%
70%
80%
81.5%
60%
40%
50%
90%
2019
2020
2023
2026
2028
2027
2029
2024
2025
2021
2022
2030
Group investment portfolio target decarbonisation pathway
Table 8. SBTs – emission-based
Metric
Aggregation 
approach
2019 
base 
year
2021 
base 
year
2023
Target
We commit to maintain the emissions intensity of our 
electricity generation project finance portfolio, within our 
shareholder investments, at or below 60 KgCO2e/kWh 
from 2021 through 2030 and only finance 1.5°C aligned 
electricity generation projects.
KgCO2e/kWh
n/a
60
60
60
We commit to reduce our real estate investment portfolio 
GHG emissions by 58% per square metre by 2030 from 
a 2019 base year.
tCO2e/m2
0.058
n/a
0.050
0.024
We commit to reduce our downstream leased asset GHG 
emissions by 55% per square metre by 2030 from a 2019 
base year.
tCO2e/m2
0.055
n/a
0.047
0.02
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Implied portfolio
temperature alignment
Methodology
To complement the portfolio GHG emission 
intensity metrics, Legal & General uses an implied 
portfolio temperature alignment metric to measure 
and manage investment impact. This alignment 
metric measures and provides a score for the 
implied warming potential of a company (or 
aggregate portfolio).
The implied temperature alignment metric describes 
the climate transition pathway (temperature 
scenario) each company is expected to align to, 
based on both historical decarbonisation trends and 
targets the company has set. It reflects the direct link 
between global carbon emissions and the likely 
severity of global warming and allows investors to 
measure their impact on climate change and evaluate 
their performance relative to SBTs.
There are three key steps to the calculation of implied 
temperature alignment:
1.	 project a company’s carbon emission pathway 
to 2030
2.	 project relevant science-based sector emission 
targets using decarbonisation pathways from 
climate scenarios
3.	 rate companies’ implied temperature alignment 
by assessing carbon intensity against science-
based sector targets.
For most companies, implied temperature alignment 
is calculated on the basis of scope 1 and 2 emissions. 
Scope 3 emissions estimates are included for 
financials, and oil and gas companies, using an LGIM 
methodology which is consistent across issuers. 
Midstream companies’ alignments use a qualitative 
scoring methodology, noting business models with 
differing ownership structures. Electric utilities are 
assessed on their projected energy mix and the GHG 
emissions per unit of electricity (tCO2e/MWh) relative 
to regional benchmarks. For sovereign bonds, we 
incorporate Climate Action Tracker country-level 
assessments, country-level decarbonisation targets 
and historical carbon data to calculate sovereign 
alignment scores which can be compared directly 
to corporate alignments1.
Our implied temperature alignment methodology 
covers listed equities, corporate bonds, sovereign 
bonds and quasi-sovereign bonds. It does not 
cover real estate, alternatives or private equity due 
to data availability. 
LGIM alignment scores are constructed to follow 
TCFD recommendations and are a quantitative 
expression of LGIM modelling and assumptions 
around the energy transition.
We note that there are numerous portfolio 
temperature metrics in development across the 
industry and advise caution in comparing scores 
across different methodologies at this stage. This 
includes aggregation methodologies which are 
described further within the additional information 
chapter. We particularly note the portfolio 
temperature rating (PTR) metric methodology 
developed by the SBTi which we have calculated 
for our SBT suite described below.
A key distinction between the LGIM and SBTi 
methodologies relates to assessing the credibility of 
published targets. Temperature alignment scores are 
subject to an internal assessment whereas the SBTi 
PTR scores directly applies published ambitions.
Science-based targets
In line with this commitment to our validated SBTs, 
we have started to track the associated PTR scores, 
which scores companies in relation to their published 
targets in line with SBTi requirements.
Our performance to date is provided in Table 9, noting 
we have further to go in achieving our targets across 
both metrics.
1.	 www.climateactiontracker.org/
2.	 ECOTS: Enterprise value including cash emissions weighted temperature score.
Progress in 2023
We have analysed c.£35 billion of listed assets 
(including government bonds), out of our £92.5 billion 
of Group proprietary assets, where we have the 
relevant data. Our updated scores are shown in 
Chart 14.
We can judge progress on the implied warming 
potential of our portfolio by comparing to well-known 
indices which serve as a proxy for ‘the world as it is’. 
For bonds, we compare to the Barclays Agg 1% index 
(with 92% coverage), while we use MSCI World for 
equities (99% coverage).
This gives us a sense of where we are compared 
to both a net zero (1.5°C) objective and through the 
use of a benchmark, to the temperature alignment 
of the broader investment universe.
This means that on this portion of our assets we are 
more highly weighted in stocks transitioning more 
quickly than the average in the relevant sector of the 
chosen index.
Chart 14.
2.4
2.7
2.5
2.5
2.0
1.0
0.0
1.5
3.0
4.0
2.6
Legal & General
Benchmark
2023 implied portfolio 
temperature alignment (°C) 
c.£35bn of bonds and listed equity  
Bonds
Equity
Total 
Portfolio
Source: LGIM Destination@Risk
Table 9. Science-based targets – Portfolio Temperature Rating
Metric
Aggregation 
approach
Scope
2021 
base 
year
2023
Target
We commit to align the (SBTi-defined) portfolio 
temperature rating score for our listed equity, 
corporate bonds and corporate loans portfolio, 
within our shareholder owned investments, as 
follows:
•	 From 2.4°C at end 2021 to 2.1°C by end 2026, 
covering portfolio company scopes 1 and 2
•	 From 2.9°C at end 2021 to 2.5°C by end 2026, 
covering portfolio company scopes 1, 2 and 3.
°C (ECOTS2 
aggregation)
1 and 2
1, 2 and 3
2.4
2.9
2.4
2.7
2.1
2.5
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Remuneration
Engagement
We use our influence as an investment manager to support the transition to a low-carbon economy  
and nature-positive world. We do this through active engagement, or as we term it ‘engagement with 
consequences’. Our metrics demonstrate impact when viewed as part of our wider engagement strategy.
Transparency
We publish our assessment of companies against 
our expectations:​
•	
LGIM ESG Score rates c.17,000 companies
•	
LGIM CIP Score rates over 5,000 companies.​
​
We publish our policies, our latest views and our 
expectations of companies on the LGIM website 
and blog.
Engagement
Company engagement:​
•	
we undertook over 2,000 engagements with 
companies on environmental topics in 2023
•	
under our CIP, we conducted in-depth 
engagement with 105 companies across 
20 ‘climate-critical’ sectors1. ​
In 2023, we engaged with over 1,500 companies 
within the quantitative stream of our CIP.
Measuring progress
Climate Impact Pledge1: ​
•	
we reinstated one company which had been 
on our divestment list, following improvement 
versus our minimum expectations2
•	
of the 105 ‘dial mover’ companies for direct 
engagement under our CIP campaign, 41% 
disclosed a net zero commitment or target1. ​
​
We co-filed three shareholder resolutions in 2023, 
two of which were related to climate change. 
Escalation
Under our CIP, 299 companies out of the CIP 
universe were identified by our quantitative 
assessment as being subject to voting sanctions 
for not meeting our minimum standards1.
2023 was the first year we applied specific voting 
sanctions to companies in deforestation-critical 
sectors that did not have a deforestation policy or 
programme in place. We applied voting sanctions 
to over 100 companies under this initiative.
Engagement
Beginning in 2021, we set climate-related targets 
in our executive directors’ remuneration.
Annual variable pay (AVP)
Purpose
AVP incentivises and rewards the achievement 
of annual financial performance and delivery 
of strategic priorities. 50% of AVP is received in cash 
and 50% of the AVP award is deferred into restricted 
shares for a further three years, reinforcing retention 
and alignment with shareholders.
Climate considerations
30% of AVP is based upon the achievement of 
strategic objectives, which includes ESG. For 2023, 
environmental performance measures are aligned 
to our key commitments in our 2022 climate report. 
This includes progress on portfolio carbon 
emissions intensity reduction and delivery of our 
operational emissions SBT in line with annual and 
interim milestones.
Performance share plan (PSP)
Purpose
The PSP provides a direct and transparent link 
between executive pay and the delivery of shareholder 
returns over the longer term. The PSP is a conditional 
award of shares, subject to a performance period of 
no less than three years and a holding period such 
that no awards are released before five years from 
the grant.
Climate considerations
The Remuneration Committee assesses the formulaic 
vesting outcome and may adjust the level of vesting 
downwards considering a range of factors including 
overall Group performance, risk management, 
progress against our 2023 environmental 
commitments and other capital and solvency 
measures. The vesting level of PSP awards may be 
adjusted downwards by up to 100% if outcomes are 
deemed insufficient.
Changes have been made for the 2024 PSP award, 
whereby vesting of 20% of the PSP will be subject 
to how the business has performed against its 
climate commitments. More details are provided in 
our Annual report and accounts and will be provided 
in our 2024 Climate and nature report.
Engagement and
remuneration
1.	 As at June 2023.​
2.	 Companies are divested from selected funds with £176 billion in AUM (as at 31 December 2023), including funds in the Future World 
fund range, LGIM’s ESG fund ranges and all auto-enrolment default funds in L&G Workplace Pensions and the L&G Mastertrust. 
Companies are divested up to a pre-specified tracking-error limit. If the tracking error limit is reached, holdings are reduced rather than 
fully divested.
LGIM Active Ownership report
See LGIM’s Active Ownership report: 
www.lgim.com/uk/en/responsible-investing/active-ownership/
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Our operational targets
and commitments
The way in which we operate our businesses 
has the potential to create both environmental 
impacts and opportunities. To help ensure that 
we continue to drive environmental 
improvements through our operations and to 
support our long-term approach to managing 
climate and nature risks, we have developed 
a suite of environmental targets and 
commitments which are outlined opposite. 
We believe these strategic themes are material 
to our operations and will help shape our 
response to the risks and opportunities in 
the short, medium and long term.
1.	 Applies to occupied offices where we actively control the 
management of utilities.
2.	 To account for the impact of the pandemic our 2021 base 
year includes estimated emissions data from our Real 
Assets portfolio based on 2019 data. All other base year 
emissions are from 2021.
The energy we use
Strategic commitment
We will reduce our energy usage in line 
with our journey to net zero and source 
energy from renewable sources.
Target
By 2025, we will purchase 100% of directly 
procured electricity group-wide from 
renewable sources.
We will reduce absolute scope 1 and 2 GHG 
emissions by 42% by 2030 from a 2021 base year.
From 2030, our occupied offices (scope 1 and 2 
will operate with net zero carbon emissions1.
Progress in 2023
Our scope 1 and 2 emissions reduced by 29% 
from our 2021 base year for our SBT2.
Our occupied offices generated 2,906 tCO2e.
We procured 82% of our electricity from 
renewable sources.
The way we travel
Strategic commitment
We will use hybrid working practices 
and technology to actively reduce the 
business miles we travel in line with 
our commitment to net zero.
Target
From 2030, our group-wide business travel 
will generate net zero GHG emissions.
Progress in 2023
Business travel generated 7,631 tCO2e. 
We introduced new controls in our travel booking 
policy to enable employees to make informed 
carbon choices when booking travel. We will 
continue to seek ways to reduce the carbon 
associated with how our people travel for 
business purposes. Noting, we expect our 
absolute emissions from business travel to 
increase in 2024, as we grow our business. 
Natural resources
Strategic commitment
We will protect the natural resources 
we use through the implementation 
of sustainable procurement principles 
throughout our supply chain.
Target
By end of 2023, we will set a scope 3 category 1 
(purchased goods and services) SBT, aligned 
with our net zero ambition1.
By end of 2026, 80% of our suppliers, by spend, 
will set a science-based carbon reduction target.
Progress in 2023
We set our SBT for purchased goods and 
services, listed above and explained in further 
detail on page 16.
We engaged with the top 30 suppliers from our 
supply chain to better understand their carbon 
footprints and how we can work together to 
improve efficiencies.
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43

1.	 Applies to occupied offices where 
we actively control the management 
of utilities.
2.	 Focusing on palm oil, soy, beef, pulp 
and paper.
Our operational targets and commitments
continued
Water resources
Strategic commitment
We will protect and minimise 
the use of water resources in 
the spaces we create and occupy.
Target
From 2022, new LGC housing developments 
submitted for outline planning permission will 
target 110 litres of water per person per day 
(lpppd), moving to 105 lpppd by 2023, in areas 
of water stress.
By 2030, our core occupied offices will consume 
a maximum of 22 lpppd in line with the Real 
Estate Environmental Benchmark (REEB)1.
Zero water pollution incidents.
Progress in 2023
Zero water pollution incidents reported.
Our occupied offices achieved 33 lpppd (2022: 
36 lpppd)1. IVG exceeded its target achieving 
100 lpppd. CALA significantly improved its result, 
achieving 109 lpppd, meeting local planning 
requirements. CALA has improved the design 
of new homes and is testing more water-efficient 
appliances in its Eco Home project aiming to learn 
lessons to apply across all projects in the future.
Circular economy
Strategic commitment
We aim to minimise and design 
out waste through the careful 
implementation of the principles 
of the circular economy.
Target
By 2025, we will divert 100% of waste from landfill 
in all offices and LGC development projects where 
we are responsible for waste management.
By 2025, we will reduce overall waste volumes 
per core occupied office by 20% from a 2019 
base year1.
Progress in 2023
99% of waste diverted from landfill.
Occupied offices’ waste reduced by 61% from 
the 2019 base year.
Biodiversity
Strategic commitment
We are committed to creating diverse 
and valuable natural spaces and 
achieving overall net biodiversity gains. 
We are also committed to understanding 
and positively shaping the biodiversity 
impacts of the investments we make.
Target
In 2023, we will develop our biodiversity strategy, 
focusing on impacts and opportunities on 
development sites within our housing and 
Real Assets businesses.
By 2025, we will report on milestones to reduce 
agricultural commodity-driven deforestation 
related to our investments and increase our 
investment in nature-based solutions2.
Progress in 2023
Our strategic approach to nature and biodiversity 
was approved by the GEC. 
We have extended the scope of our reporting 
to include nature and will continue to shape our 
approach to nature-related risks and opportunities 
in the coming year. 
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Additional information
44

Giraffe 
Credit: Jonathan Ponsie  
Scrum Master, London
Additional 
information
45
Legal & General Group Plc Climate and nature report 2023
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Additional information

Our impacts, risks and 
opportunities assessment
During 2023, we undertook a review of our 
sustainability impacts, risks and opportunities 
to ascertain the most material topics for the Group 
and to assess the fitness of our various strategies 
in response to them. 
We considered that nine topics were of a ‘high to very 
high’ relevance to us, both because they have a high 
degree of impact on us and because we have a high 
potential to impact on how these issues unfold 
These themes are: 
•	
climate change mitigation
•	
biodiversity and ecosystem loss
•	
transparency of reporting
•	
accessible and affordable housing
•	
financial inclusion 
•	
infrastructure and real estate 
•	
health and wellbeing 
•	
corporate culture 
•	
diversity and inclusion.
 
Our analysis concluded that we have an appropriate 
awareness and coverage of topics in our various 
sustainability and related strategies. There are some 
gaps which are either the result of evolving thinking 
or instances where we are still working towards 
developing our view. There are some topics where 
additional focus could drive additional benefit to the 
business and our stakeholders.
Our Climate and nature report focuses primarily on 
the environmental themes that were captured within 
this assessment. This aligns with the work the 
business has done on these topics, following the 
release of both the ISSB standards and TNFD 
recommendations during 2023. We have included a 
TNFD index on page 48 which sets out in more detail 
the work we have done to engage with this global 
framework for nature.
2
Assessment of topic 
relevance and materiality 
to the Group
Having long-listed the topics, we next assessed their relevance to the Group, using the following methodology: 
•	
an assessment of the topic’s ability to impact the Group’s revenue, cost of capital and valuation (including an assessment 
of reputational risk) over the short, medium and long term
•	
consideration of whether the topic is systemically important or poses a systemic risk
•	
a view of the Group’s capacity to impact the unfolding of, or its dependency on the unfolding of, the topic – the assessment 
of impacts, risks and opportunities was informed by our business model and strategic purpose
•	
a summary judgment on the overall importance of the topic to the Group.
4
Governance reviews
The findings were subject to scrutiny and approval by the GEC in the first quarter of 2024.
3
Assessment of the fitness 
of our strategic approach
Having assessed the relevance of the topics, we took a view on the extent to which our existing sustainability and related strategies 
adequately addressed the most relevant topics.
1
Taxonomy definition
We defined a taxonomy of 201 sustainability topics, grouped into 59 themes and 11 mega-themes across environmental, social and 
governance groupings. For the purposes of this exercise we took ‘sustainability topics’ to mean themes which originate outside the 
Group; can be classified as environmental, social or governance concerns; and whose meanings have a high degree of interoperability 
across industries and sectors of the economy. 
Our long-list was informed by external standards including (but not limited to) the United Nations’ Sustainable Development Goals; 
the PRI; the Global Reporting Index; the Sustainability Accounting Standards Board framework; and the European Union’s Corporate 
and Sustainability Reporting Directive and its supporting standards.
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Summary disclosure against 
TCFD recommendations
Strategy
Further details are disclosed on pages 6 to 18.
Climate-related risks and opportunities 
Our climate-related risks and opportunities are on page 8. We have integrated climate risk management into our overall risk management framework and are well placed to play a role in the decarbonisation 
of the economy.
Impact on our businesses, strategy 
and financial planning
Addressing climate change is one of our six strategic growth drivers and we have built a three-pillar approach around: how we invest our assets, how we influence as an asset manager and how our 
businesses operate. Our business model is not expected to be significantly disrupted by climate change, however it does impact on how we execute our strategy. Our climate strategy is on pages 6 to 18 
and our more detailed Climate transition plan is available on our website. We also disclose results of our scenario analysis, which quantifies potential impacts of different climate scenarios on pages 19 
to 25. Our proprietary model on climate change is used to quantify the potential impacts of climate change on our portfolio.
Resilience based on scenarios, 
including a 2°C or lower scenario
Our climate scenario analysis helps us to identify and quantify the sources and magnitude of potential climate-related risks that will emerge as the world transitions to a low-carbon economy. 
These scenarios, including a 2°C or lower scenario, are covered on pages 19 to 25.
Governance
Further details are disclosed on pages 26 to 29.
The Board’s role in oversight 
The Board is accountable for the long-term stewardship of the Group. It has delegated oversight of the management of climate-related risks to the GEC. The structure, roles and responsibilities and key 
decisions and discussions, are on pages 27 to 28.
Management’s role in assessing risks 
and opportunities
Our Group Climate Director chairs the GEC and we set out some of our senior managers’ responsibilities through the committees and overall risk and governance framework on pages 27 to 28. 
Climate-related targets are included in executive directors’ remuneration and this is detailed on page 42.
Risk management
Further details are disclosed on pages 30 to 35.
Processes for identifying and 
assessing climate-related risks
Climate risk management has been integrated into our risk and governance framework, as seen on pages 31 to 32. We also use scenario analysis to carry out a detailed assessment of the potential 
impacts from climate risk.
Processes for managing 
climate‑related risks
Our range of actions in meeting our climate risk management objectives are set out on pages 33 to 35. These include our active engagement, exclusion policy and high-carbon escalation process.
How we integrate these risks into 
our overall risk management
The Group’s climate governance has been designed to ensure that the management of the financial risks from climate change are integrated across the whole governance system and embedded into 
the existing risk management framework.
Metrics and targets
Further details are disclosed on pages 36 to 44.
Internal metrics
Our metrics support our commitment to align with the 1.5°C ‘Paris’ objective. We focus on our investment portfolio economic carbon intensity, implied portfolio temperature alignment and operational 
carbon footprint. We also measure our engagement with investee companies. Further details are in the metrics and targets chapter on pages 36 to 44.
GHG emissions
Our scope 1 and 2 (location) operational emissions were 27,722 tCO2e. Our scope 3 non-investment emissions (fuel and energy-related activities, waste, business travel, working from home and serviced 
offices) were 20,316 tCO2e. Our scope 3 downstream leased assets were 0.3 million tCO2e. Our scope 3 investment emissions were 5.0 million tCO2e.
Targets
We have set our climate targets across our three pillar climate strategy to align with the ‘Paris’ 1.5°C objective. A detailed list of our climate commitments is set out on pages 49 to 50.
We have continued to disclose in line with the recommendations 
of the TCFD, in compliance with the FCA Listing Rule 9.8.6R(8). The table 
below gives a summary of how and where we have addressed the TCFD 
recommendations in this report. This standalone document provides us 
with the space we require to provide sufficient detail of our exposure to 
and approach to addressing, climate-related issues, as we do with our 
detailed disclosures on risk, tax and social issues. We also disclose 
this index in our Annual report and accounts to signpost readers to our 
climate-related disclosures. In response to FCA guidance 9.8.6FG, we 
also produced a stand-alone Climate transition plan in April 2023. This 
was subsequently approved at our AGM in May 2023. Our plan sets out 
our role in aligning our company with a 1.5°C net zero outcome, 
consistent with the UK government’s targets.
Legal & General Group Plc Climate and nature report 2023
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Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information
47

Summary disclosure against 
the four pillars of TNFD
TNFD pillar
Summary of our current disclosures​
Strategy
While addressing climate change is our priority, we recognise that climate change and nature are interdependent – we 
cannot address one without the other. Our nature-related strategy builds on this interaction, expanding our response 
to climate change beyond GHG emissions. We are using our existing approach to climate change to help us identify 
our nature-related impacts, dependencies, risks and opportunities. 
Our business model is not expected to be significantly disrupted by nature-related impacts, dependencies, risks and 
opportunities, however it impacts how we execute our strategy. As a large financial institution we are exposed to 
nature through our investments, in particular our investments in real assets. We also have a direct interface with 
nature through our operations. As with climate change, we recognise our scale gives us an important opportunity 
to engage on these topics with the real economy. These aspects of our strategy are described on pages 6 to 18.
Nature-based scenarios are still an emerging area – our climate scenario modelling incorporates land use modelling 
and we have begun to examine the impact of our climate scenarios on some nature-related variables, including 
biodiversity as described on (pages 22 and 25). We continue to stay abreast of emerging methodologies and 
practices on scenario modelling and our wider nature-related risk management and strategy.
Governance
The Board is accountable for the long-term stewardship of the Group. It has delegated oversight of the management 
of environmental risks to the GEC. The GEC is chaired by our Group Climate Director. We set out the roles and 
responsibilities of the GEC and the Group Climate Director, as well as key decisions and discussions, in the 
governance chapter (page 28).
We explain the link between remuneration and progress against climate commitments (page 42).
Risk management​
We are developing our climate risk management and governance framework to incorporate nature-related impacts, 
dependencies, risks and opportunities (pages 31 to 32). These include embedding biodiversity and deforestation 
considerations within our active engagement and high-carbon escalation process. This approach builds on the 
Group’s climate governance which has been designed to ensure that the management of these risks is integrated 
across the whole governance system and embedded into the existing risk management framework. We also include 
land-use assumptions within our climate scenario analysis.
Metrics and targets​
We continue to develop our approach to metrics. Key metrics across our three pillars include: our investment 
portfolio’s exposure to sectors with nature-related dependencies (page 25); our numbers of nature-specific 
engagements (page 42); and, the reduction of waste from our occupied offices (pages 43 to 44).
Below is a summary of how this report aligns with the four pillars of 
the Taskforce for Nature-related Disclosures’ (TNFD) recommendations. 
We are using this global framework to improve our understanding 
of our nature-related impacts and dependencies and are intending 
to adopt the recommendations of the TNFD more widely over future 
iterations of our reporting. This aligns with our initial approach to 
climate-related disclosures.
Legal & General Group Plc Climate and nature report 2023
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Strategy
Scenarios
Governance
Risk management
Metrics and targets
Additional information
48

Commitments in detail
Our journey to net zero (pages 9, 12 and 15) shows some of the key 
milestones for us to deliver as part of our Climate transition plan 
to achieve net zero by 2050. It also demonstrates some of our 
achievements during the year. 
These pages supplement our journey to net zero with our detailed 
commitments, as well as their interim milestones. These more granular 
pages focus on ‘what’ we plan to achieve, with the earlier narrative 
in this report setting out the ‘how’.
Below, as a matter of full transparency, we have drawn out the 
commitments we disclosed last year that we said would be completed 
during 2023.
Our commitments to be delivered during 2023
Commitment
By
Update
By the end of 2023 reduce portfolio GHG 
emission intensity by 18%1.
2023
We have reduced our intensity score by 
-9% from end 2022 and -30% from the 
end 2019 base year, in part from active 
trading decisions in 2023. This leaves us 
well-positioned to meet our first interim 
target by 2025.
We will disclose deforestation risk and 
mitigation activities in our portfolio as part 
of our year end 2023 publications.
2023
On page 25 we disclose our exposure to 
names identified on data sources calling 
out deforestation exposures, alongside 
our mitigation activities.
LGIM will publish its approach to climate 
resilience across the real estate business in line 
with the BBP Climate Change Commitment.
2023
We published an update to our net zero 
carbon roadmap in 2023 and will publish 
our climate resilience approach in 2024, 
in line with the commitment’s 
requirement.
 Invest
How we invest our £92.5 billion of proprietary assets
Commitment
By
Milestones (where relevant)
By
We are targeting a net zero asset portfolio by 
2050, in line with a 1.5°C ‘Paris’ objective and 
continue to evolve our interim targets against 
this objective.
2050
We will reduce portfolio GHG emission intensity 
by 18.5%1 and increase financing of low carbon 
technology and infrastructure.
2025
We will reduce portfolio GHG emission intensity 
by 50%1 and increase financing of low-carbon 
technology and infrastructure.
2030
We have set SBTs in accordance with the SBTi.
2030
Align the (SBTi-defined) portfolio temperature score 
for our listed equity, corporate bonds and corporate 
loans portfolio, within our shareholder investments 
as follows:
•	
from 2.4°C at end 2021 to 2.1°C by end 2026, 
covering portfolio company scopes 1 and 2
•	
from 2.9°C at end 2021 to 2.5°C by end 2026, 
covering portfolio company scopes 1, 2 and 3.
2026
Further asset class and sector-specific targets 
(covering real estate and electricity generation 
project finance portfolios summarised on page 40).
2030
We will continue to evolve our thermal coal 
exclusion criteria, phasing out investment-
related coal and oil sands exposures by 20302.
2030
Coal exclusions are in place, including avoiding 
investment in new coal mining, plant or 
business operations.
Active
We will report progress on the milestones 
to reduce agricultural3 commodity-driven 
deforestation in our investment portfolios 
and we will increase investment in nature-
based solutions.
2025
We will report progress on investment in nature-
based solutions and defining associated 
financing criteria.
2025
1.	 From a 2019 base year.
2.	 Investment with more than 5% revenue exposure by 2030.
3.	 Focusing on palm oil, soy, beef and leather, pulp and paper.
Climate transition plan: 
group.legalandgeneral.com/
ClimateTransitionPlan2023
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49

Operate
How our businesses operate
Commitment
By
Milestones (where relevant)
By
We have set SBTs to reduce absolute scope 1 
and 2 GHG emissions by 42% by 2030 from 
a 2021 base year3.
2030
We commit to ensuring that 80% of our 
suppliers, by spend, will set a science-based 
carbon reduction target.
2026
All new homes delivered from 2030 will 
be enabled to operate at net zero carbon, 
both regulated and unregulated energy.
2030
From 2030, our operational footprint 
(occupied offices and business travel4) 
will operate with net zero carbon emissions.
2030
All homes delivered by CALA will be designed 
to meet the LETI and RIBA 2030 target for 
embodied carbon standards from 20255.
2025
Net zero operational carbon footprint.
2050
Commitments in detail
continued
1.	 Excludes sovereigns and derivative securities until such time as agreed methodologies exist.
2.	 Focusing on palm oil, soy, beef and leather, pulp and paper.
3.	 To account for the impact of the pandemic, our 2021 base year includes estimated emissions data from our managed Real Assets 
portfolio based on 2019 data, all other baseline emissions are from 2021.
4.	 Applies to occupied offices where we actively control the management of utilities.
5.	 LETI 2030 target: <300kgCO2/m² Upfront carbon A1-5, excl sequestration. RIBA 2030 target: <625kgCO2/m² embodied carbon A1-5, 
B1-5, C1-4, incl sequestration.
 Influence
How we influence as one of the world’s largest asset 
managers with £1.2 trillion of AUM
Commitment
By
Milestones (where relevant)
By
LGIM is committed to work in partnership with 
our clients to reach net zero GHG emissions 
by 2050 or sooner across all AUM.
2050
In partnership with clients, LGIM will target 70% 
of AUM to be managed in alignment with net zero1.
2030
LGIM is committed to achieving net zero carbon 
for all of its real estate equity assets by 2050 
or sooner.
2050
LGIM will target net zero operational carbon within 
the Sustainable Defined Contribution Property Fund 
by 2030.
2030
LGIM will target the removal of fossil fuels within 
areas of commercial property we control by 2030. 
In isolated instances where this is not possible, 
LGIM commits to publishing a list of affected assets 
and a roadmap to removing fossil fuels subsequent 
to 2030. 
2030
We have set an SBT-aligned target to reduce 
LGIM’s downstream leased real estate portfolio 
GHG emissions per square metre by 55% 
by 2030 from a 2019 base year.
2030
LGIM will report progress on the milestones 
to reduce agricultural commodity-driven 
deforestation in our investment portfolios 
through successful company engagement2.
2025
Legal & General Group Plc Climate and nature report 2023
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50

Independent limited Assurance Report to 
the Directors of Legal & General Group Plc
Independent limited Assurance Report by Deloitte LLP 
to the Directors of Legal & General Group Plc on 
selected Environmental, Social and Governance 
(“ESG”) metrics (the “Selected Information”) within the 
Climate and Nature Report of Legal & General Group 
Plc for the reporting year ended 31 December 2023.
Our assurance conclusion
Based on our procedures described in this report, 
and evidence we have obtained, nothing has come 
to our attention that causes us to believe that the 
Selected Information for the year ended 31 December 
2023, as listed below and indicated with a * in the 
Climate and Nature Report of Legal & General Group 
Plc has not been prepared, in all material respects, 
in accordance with the Applicable Criteria defined 
by the directors. 
Scope of our work 
Legal & General Group Plc has engaged us to 
perform an independent limited assurance 
engagement in accordance with the International 
Standard on Assurance Engagements 3000 
(Revised) Assurance Engagements Other than 
Audits or Reviews of Historical Financial Information 
(“ISAE 3000 (Revised)”), International Standard 
on Assurance Engagements 3410 Assurance 
Engagements on Greenhouse Gas Statements 3410 
(“ISAE 3410”) issued by the International Auditing 
and Assurance Standards Board (“IAASB”) and our 
agreed terms of engagement.
The Selected Information in scope of our 
engagement for the year ended 31 December 2023, 
as indicated with a * in the Climate and Nature 
Report, is as follows:
Selected Information
Reported 
amount
Scope 1 emissions (tonnes CO2e)
10,158 
Location based Scope 2 emissions 
(tonnes CO2e) 
17,564 
Market based Scope 2 emissions 
(tonnes CO2e)
4,215 
Scope 3 emissions categories– Category 
6: Business travel (tonnes CO2e)
7,631 
Scope 3 emissions categories – Category 
7: Homeworking (excluding employee 
commuting) (tonnes CO2e)
4,568 
Scope 3 emissions categories – Category 
8: Serviced offices (excluding upstream 
leased assets) (tonnes CO2e)
304 
The Selected Information, as listed in the above table, 
needs to be read and understood together with the 
Applicable Criteria: group.legalandgeneral.com/
reports.
Inherent limitations of the Selected Information 
We obtained limited assurance over the preparation 
of the Selected Information in accordance with the 
Applicable Criteria. Inherent limitations exist in all 
assurance engagements.
Any internal control structure, no matter how 
effective, cannot eliminate the possibility that fraud, 
errors or irregularities may occur and remain 
undetected and because we use selective testing 
in our engagement, we cannot guarantee that errors 
or irregularities, if present, will be detected.
The self-defined Applicable Criteria, the nature of 
the Selected Information, and absence of consistent 
external standards allow for different, but acceptable, 
measurement methodologies to be adopted which 
may result in variances between entities. The 
adopted measurement methodologies may also 
impact comparability of the Selected Information 
reported by different organisations and from year to 
year within an organisation as methodologies develop. 
Directors’ responsibilities 
The Directors are responsible for: 
•	
selecting and establishing the Applicable Criteria.
•	
preparing, measuring, presenting and reporting 
the Selected Information in accordance with the 
Basis of Preparation. • Publishing the Applicable 
Criteria publicly in advance of, or at the same time 
as, the publication of the Selected Information.
•	
designing, implementing, and maintaining internal 
processes and controls over information relevant 
to the preparation of the Selected Information 
to ensure that they are free from material 
misstatement, including whether due to fraud 
or error.
•	
providing sufficient access and making 
available all necessary records, correspondence, 
information and explanations to allow the 
successful completion of our limited 
assurance engagement.
Our responsibilities 
We are responsible for: 
•	
planning and performing procedures to obtain 
sufficient appropriate evidence in order to express 
an independent limited assurance conclusion on 
the Selected Information.
•	
communicating matters that may be relevant to 
the Selected Information to the appropriate party 
including identified or suspected non-compliance 
with laws and regulations, fraud or suspected 
fraud, and bias in the preparation of the Selected 
Information.
•	
reporting our conclusion in the form of an 
independent limited Assurance Report to the 
Directors of Legal & General Group Plc.
Our independence and competence
In conducting our engagement, we complied with 
the independence and other ethical requirements 
of the ICAEW Code of Ethics. The ICAEW Code is 
founded on fundamental principles of integrity, 
objectivity, professional competence and due care, 
confidentiality and professional behaviour.
We applied the International Standard on Quality 
Management (UK) 1 (“ISQM (UK) 1”) issued by 
the Financial Reporting Council. Accordingly, we 
maintained a comprehensive system of quality 
management including documented policies and 
procedures regarding compliance with ethical 
requirements, professional standards and applicable 
legal and regulatory requirements.
Deloitte assurance opinion
Legal & General Group Plc Climate and nature report 2023
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51

Key procedures performed 
We are required to plan and perform our work to 
address the areas where we have identified that a 
material misstatement in respect of the Selected 
Information is likely to arise. The procedures we 
performed were based on our professional judgment. 
In carrying out our limited assurance engagement in 
respect of the Selected Information, we performed 
the following procedures: 
•	
performed an assessment of the Applicable 
Criteria (the benchmarks used to measure or 
evaluate the underlying information) to 
determine whether they are suitable for the 
engagement circumstances.
•	
performed analytical review procedures to 
understand the underlying subject matter and 
identify areas where a material misstatement 
of the Selected Information is likely to arise.
•	
through inquiries of management, obtained an 
understanding of the Company, its environment, 
processes and information systems relevant to 
the preparation of the Selected Information 
sufficient to identify and further assess risks of 
material misstatement in the Selected 
Information, and provide a basis for designing and 
performing procedures to respond to assessed 
risks and to obtain limited assurance to support 
a conclusion.
•	
through inquiries of management, obtained an 
understanding of internal controls relevant to the 
Selected Information, the quantification process 
and data used in preparing the Selected 
Information, the methodology for gathering 
qualitative information, and the process for 
preparing and reporting the Selected Information. 
We have not evaluated the design of particular 
internal control activities, obtained evidence 
about their implementation or tested their 
operating effectiveness.
•	
inspected documents relating to the Selected 
Information, including board committee minutes 
to understand the level of management awareness 
and oversight of the Selected Information.
•	
performed procedures over the Selected 
Information, including recalculation of relevant 
formulae used in manual calculations and 
assessment whether the data has been 
appropriately consolidated.
•	
performed procedures over underlying data on 
a statistical sample basis to assess whether the 
data has been collected and reported in 
accordance with the Applicable Criteria, including 
verifying to source documentation.
•	
performed procedures over the Selected 
Information including assessing management’s 
assumptions and estimates.
•	
accumulated misstatements and control 
deficiencies identified, assessing whether material.
•	
read the narrative accompanying the Selected 
Information with regard to the Applicable Criteria 
and for consistency with our findings. 
The procedures performed in a limited assurance 
engagement vary in nature and timing from, and are 
less in extent than for, a reasonable assurance 
engagement. Consequently, the level of assurance 
obtained in a limited assurance engagement is 
substantially lower than the assurance that would 
have been obtained had a reasonable assurance 
engagement been performed. 
Use of our report 
This report is made solely to the Directors of 
Legal & General Group Plc in accordance with ISAE 
3000 (Revised), ISAE 3410 and our agreed terms of 
engagement. Our work has been undertaken so that 
we might state to the Directors of Legal & General 
Group Plc those matters we have agreed to state 
to them in this report and for no other purpose.
Without assuming or accepting any responsibility 
or liability in respect of this report to any party other 
than Legal & General Group Plc and the Directors of 
Legal & General Group Plc, we acknowledge that the 
Directors of Legal & General Group Plc may choose 
to make this report publicly available for others 
wishing to have access to it, which does not and will 
not affect or extend for any purpose or on any basis 
our responsibilities. To the fullest extent permitted 
by law, we do not accept or assume responsibility to 
anyone other than Legal & General Group Plc and the 
Directors of Legal & General Group Plc as a body, for 
our work, for this report, or for the conclusions we 
have formed. 
Deloitte LLP 
London
5 March 2024 
Deloitte assurance opinion
continued
Legal & General Group Plc Climate and nature report 2023
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Metrics and targets
Additional information
52

As we continue to build our understanding of 
our climate and nature-related opportunities and 
risks, we are improving our quantification of our 
opportunities and risks in relation to both our 
investments and our operations. These metrics 
are sourced from organisations such as the ISSB 
and NZAOA.
We focus on the primary metrics in the metrics 
and targets chapter of this report, but the tables 
on these pages provide a full metric dashboard 
as at 31 December 2023.
The tables compare the current year metric with 
both the prior year and the base year, where available. 
This provides useful context as to the trajectory of 
our emissions. 
We endeavour to continue to build on these metrics 
over future iterations of our reporting, particularly 
as we see methodologies on nature-related 
metrics improve.
Metrics dashboard
 Invest
Metric category
Metric
Metric 
measurement1
2019
(Rebased)2
2021
(Rebased)2
2022
(Rebased)2
2023
Proprietary asset exposure
Portfolio value
£bn
83,700
95,698
80,488
89,999
Renewable energy investments­
£bn
1.4
1.4
1.3
1.4
Transition finance investments
£bn
–
–
–
3.3
Direct fossil fuel exposure3
£bn
–
–
1.0
1.2
Scope 3 investments 
(proprietary assets) – 
financed emissions
Investment portfolio economic GHG emissions intensity (EVIC)
tCO2e/£m EVIC
80
65
62
56
(94)
(76)
(73)
Investment portfolio economic GHG emissions intensity (2019 reduction)
%
–
(19)
(23)
(30)
Investment portfolio economic GHG emissions intensity (static EVIC)
tCO2e/£m EVIC
–
–
–
54
Investment portfolio economic GHG emissions intensity (2019 reduction)
%
–
–
–
(32)
Investment portfolio economic GHG emissions intensity ex-sovereigns 
(dynamic EVIC)
tCO2e/£m EVIC
–
61
59
52
(73)
(71)
Investment portfolio economic GHG emissions intensity (corporate 
bonds and equities, real estate and infrastructure) – NZAOA target 
metric
tCO2e/£m EVIC
(97)
–
(77)
To be 
reported 
in 2024
Investment portfolio weighted average carbon intensity (WACI)
tCO2e/USD 
million revenues
–
169
151
127
(172)
(154)
Investment portfolio GHG emissions
Million tCO2e
6.7
6.2
5.0
5.0
(7.9)
(7.3)
(5.8)
Scope 3 investments 
(proprietary assets) – 
physical intensity emissions
Real estate investment portfolio physical carbon emissions intensity
tCO2e/m2
0.058
0.054
0.050
0.050
Electricity generation project finance portfolio physical carbon 
emissions intensity
tCO2e/m2
–
60
–
60
Scope 3 investments 
(LGIM-wide) – financed 
emissions
AUM economic GHG emissions intensity (EVIC)4
tCO2e/£m EVIC
–
–
–
88
Scope 3 category 13 – physical 
intensity emissions
Downstream leased assets physical carbon emissions intensity
tCO2e/m2
0.055
0.051
–
0.047
Scope 3 investments 
(proprietary assets) – 
temperature portfolio alignment
Implied portfolio temperature alignment – internal methodology
°C (ROTS 
aggregation5)
–
2.6
2.6
2.5
(2.7)
(2.7)
Scope 3 investments 
(proprietary assets) – 
temperature portfolio 
Portfolio temperature rating – SBTi methodology
– scope 1 and 2
– scope 1, 2 and 3
°C (ECOTS 
aggregation6)
2.4
2.4
2.9
2.7
Table 10. Additional investment metrics
1.	 For each year’s calculations the emissions and revenues data 
refers to the most recently available reported carbon footprint 
scores and revenue information (which generally contains 
a one-year lag for listed equity and debt, and two-year-lag for 
sovereigns). For example, the emissions (tCO2e) and revenue 
data would generally refer to 2022 for the 2023 metric 
suite column.
2.	 Metrics have been rebaselined through a combination 
of methodology and data sourcing changes. Figures from 
the 2022 report provided in brackets.
3.	 Direct private investments in fossil fuel-related projects 
and companies.
4.	 Covering £0.8 trillion of listed bonds and equities.
5.	 ROTS: Revenue owned emissions weighted temperature score.
6.	 ECOTS: Enterprise value including cash emissions weighted 
temperature score.
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Additional information
53

Metrics dashboard
 Operate
Table 11. Additional operational metrics (carbon)
Table 12. Additional operational metrics (non-carbon)
Metric category
Metric1
Metric measurement
20212
2022
20233,4
Scope 1
Total scope 1
tCO2e
15,559
12,506
10,158*
Occupied office gas usage
tCO2e
872
509
523
Gas usage from landlord activities
tCO2e
7,175
6,068
5,385
Construction activities
tCO2e
7,512
5,929
4,250
Scope 2 (location-
based)
Total scope 2 location
tCO2e
23,423
17,556
17,564*
Occupied office electricity usage UK
tCO2e
3,964
2,393
2,383
Electricity usage from landlord activities
tCO2e
17,827
13,071
13,590
Construction activities
tCO2e
1,632
2,092
1,591
Scope 2 (market-
based)
Total scope 2 market
tCO2e
2,432
2,586
4,215*
Percentage of electricity purchased from 
a renewable source
% of total 
87
86
82
MWh
Total electricity
MWh
93,743
87,878
79,100
Total gas
MWh
56,907
47,910
42,853
Total on-site fuel from our house building 
businesses
MWh
18,118
16,112
16,795
Scope 3 – operational Category 6 – business travel
tCO2e
2,070
5,467
7,631*
Category 7 – home working
tCO2e
3,025
4,739
4,568*
Category 8 – serviced offices
tCO2e
371
306
304*
Business
2023
Embodied Carbon
kgCO2e/m2
Building lifecycle stages 
A1-A5, B1-B5, C1-C4 
including sequestration
CALA
538
IVG
600
LGAH
6325
Modular
n/a
SBTR
7796
EUI
kWh/m2/year
Building’s operational energy 
use (lifecycle stage B6), not 
including on-site renewables
CALA
90
IVG
61
LGAH
1126
Modular
–
SBTR
1076
Metric category
Metric1
Metric measurement
2021
2022
20233
Water
Core occupied office water consumption
lpppd
–
36
33
Water efficiency of IVG housing developments 
in water stressed areas
lpppd
–
100
100
Water efficiency of CALA housing 
developments in water stressed areas
lpppd
–
1227
109
Water pollution incidents
Number of water 
pollution 
prosecutions
0
0
0
Waste
Total waste
Tonnes
37,920
36,613
38,906
Waste from occupied offices
Tonnes
433
599
514
Waste from house building construction sites 
controlled by LGC
Tonnes
37,487
36,014
38,392
Total waste sent to landfill
% of total waste
1.4
<1
<1
Business
2023
Certified Timber 
Procurement
% of FSC or PEFC certified timber
% of timber used within our 
developments that has been 
procured from sustainable 
sources	
CALA
100
IVG
100
LGAH
100
Modular
100
SBTR
100
BNG8
% of new planning applications undertaking 
BNG assessment	
	
Number of sites that have 
undertaken a BNG 
assessment as part of the 
development planning 
application process as 
a percentage of the total 
number of planning 
applications submitted
CALA
63
IVG
100
1.	 Please refer to our Basis of Preparation (pages 56 to 57) for 
details of how we collate our GHG data for our operational 
carbon footprint. 
2.	 This is our 2021 SBT base year which includes our LGIM Real 
Assets 2019 data to account for the impact of the pandemic. 
3.	 We purchased Taylor Lane, a timber frame construction 
specialist in 2023, due to limited access to robust data sets this 
has been excluded from our 2023 footprint and will be included 
from 2024. Noting this does not have a material impact on our 
overall footprint.
4.	 Deloitte have provided independent limited assurance in 
accordance with the International Standard for Assurance
	
Engagements 3000 (‘ISAE 3000’) and Assurance Engagements 
on Greenhouse Gas Statements (‘ISAE 3410’) over the selected 
metrics identified with a *. Deloitte’s full unqualified assurance 
opinion, which includes details of the selected metrics assured, 
can be found on pages 51 to 52.
5.	 Data available from two developer partners. May not be 
representative of all sites.
6.	 Data from developer partners.
7.	 Measured at practical completion, not at planning application.
8.	 Other housing businesses not directly responsible for new 
planning applications or construction sites in 2023.
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54

Investment portfolio metrics detail
Investment portfolio GHG emissions intensity 
Rebasing approach
The impact of the rebasing activities that have been 
carried out this year are highlighted in Table 13, where 
we show their impacts on the equivalent metric as 
used for the production of last year’s climate report. 
This enables us to compare our 2023 metrics with 
those from 2022 on a comparable basis. 
This rebasing activity has included the upgrade 
of our measurement methodology, in particular 
relation to private credit assets. This year we have 
further refined our proxy approach, including linking 
into the PCAF database where necessary and 
available. Further detail on our proxy approaches are 
provided in the Basis of Preparation on pages 58 to 63.
The table shows the impact of stepping through 
these changes. This year’s modelling upgrade 
decreased both the economic GHG emission 
intensity and the associated revenue-based measure. 
We have used these updated, rebased numbers as 
the starting point for determining the change in GHG 
emission intensity during 2023.
Tables 14 and 15 then breakdown the end 2023 absolute 
portfolio GHG emissions by asset class and sector.
Portfolio temperature alignment 
Aggregation of implied temperature alignment 
at a portfolio level
We have adopted two methods for aggregating 
temperature alignment scores of individual securities 
into portfolio level metrics.
For the LGIM Implied Temperature Alignment metric, 
we have aligned to the SBTi ‘Revenue owned 
emissions weighted temperature score (ROTS)’ 
portfolio weighting option, which expresses portfolio 
alignment on a (revenue-intensity-based) carbon 
weighted basis1.
Table 13. Group investment portfolio GHG emission intensity
  tCO2e/£m
Measure
2022 
Climate report
Impact of private 
credit approach 
changes and other 
minor corrections
2022 restatement
2022
2022
2022 (rebased)
Investment portfolio economic carbon intensity
73
(11)
62
% reduction from 2019 base year
(23)
–
–
Investment portfolio economic carbon intensity ex sovereigns
71
(12)
59
Investment portfolio weighted average carbon intensity 
(WACI) (tCO2e/USD million revenues)
154
(3)
151
Table 14. Portfolio GHG emissions by asset class
2023 emissions
GHG emissions
(million tCO2e)
Bond
4.9
Property
0.1
Equity
0.0
Total
5.0
Table 15. Portfolio GHG emissions breakdown by sector
2023 emissions
GHG emissions
(million tCO2e)
Utilities
2.1
Energy
0.8
Materials
0.2
Industrials
0.4
Government
0.8
Other
0.8
Total
5.0
This approach aligns with LGIM’s default approach 
and supports the measurement and management 
of investment impact.
Portfolio alignment
= ∑ position value x security temperature alignment 
x security revenue-based carbon intensity (WACI)/
∑ Position value x security revenue-based carbon 
intensity (WACI)
For the SBTi Portfolio Temperature Rating (PTR) 
metric, we have aligned to the SBTi ‘Enterprise value 
and cash owned emissions weighted temperature 
score (ECOTS)’1 portfolio weighting option, which 
expresses portfolio alignment on a (EVIC-intensity-
based) carbon weighted basis.
This approach aligns with our primary economic 
emissions intensity metric to support consistency 
across our target metrics.
Portfolio alignment 
= ∑ position value x security temperature alignment 
x security EVIC-based economic carbon intensity/
 
∑ Position value x security EVIC-based economic 
carbon intensity 
 
We rely on third-parties for our emissions and 
target data; where third-party data is not available, 
we use proxies for these emissions on a best 
endeavours basis.
1.	 www.sciencebasedtargets.org/resources/files/Financial-Sector-Science-Based-Targets-Guidance.pdf
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55

Scope 1 and 2 emissions
Basis of preparation
Background
As a supporter of the Financial Stability Board’s 
(FSB) TCFD, we commit to disclosing climate-related 
financial information through an annual climate 
report, which aligns to TCFD recommendations and 
is supplementary to the Annual report and accounts. 
These disclosures will report the emission sources 
required under the Companies Act 2006 (Strategic 
report and Directors’ report) Regulations 2013 and 
will follow the requirements of the SECR framework. 
The GHG emissions data will be reported in line with 
the Greenhouse Gas Protocol Corporate Accounting 
and Reporting Standard. 
Introduction
This basis of preparation document sets out how 
Legal & General prepares its reporting for scope 1, 
scope 2 (location-based) and scope 2 (market-
based) GHG emissions. 
It is the responsibility of Legal & General 
management to ensure that appropriate internal 
procedures are in place to report GHG emissions 
performance data, in all material respects, as set 
out in this document. These procedures ensure that: 
•	
the reported information reflects 
Legal & General’s performance 
•	
the data is meaningful and is consistent with 
the stated definitions and scope
•	
any specific exclusions are stated clearly 
and explained 
•	
any assumptions made, as well as the accounting 
and calculation methods are clearly described
•	
the level of transparency is sufficient to enable 
users to have confidence in the integrity of 
Legal & General’s reporting.
1.	 Joint ventures are included in the footprint where Legal & General are the majority shareholder or have operational control.
2.	 Includes offices Legal & General occupy where Legal & General actively control the management of utilities.
3.	 We purchased Taylor Lane, a timber frame construction specialist in H2 2023, due to limited access to robust data sets this has been excluded from our 2023.
4.	 The Greenhouse Gas Protocol Corporate Reporting standard: www.ghgprotocol.org/sites/default/files/standards/ghg-protocol-revised.pdf
5.	 www.gov.uk/government/publications/environmental-reporting-guidelines-including-mandatory-greenhouse-gas-emissions-reporting-guidance
Scope
Legal & General discloses its scope 1 and 2 carbon 
emissions for the whole of Legal & General Group, 
its subsidiaries and joint ventures. 
Legal & General apply the operational control 
methodology as set out in the Greenhouse Gas 
Protocol (i.e. Legal & General include all operations 
directly controlled, such as the energy from the 
offices Legal & General occupy), Legal & General 
landlord activities, including property under 
Legal & General’s control until point of occupation/ 
sale and void properties under Legal & General 
control, as well as the construction of new homes 
within Legal & General’s housing business and 
joint ventures2. 
The carbon emissions data that is reported is aligned 
with the Group’s financial reporting year, 1 January 
to 31 December, unless otherwise stated, noting that 
LGIM Real Assets data is reported annually from 
1 December to 30 November. 
Legal & General include newly acquired businesses 
as soon as the appropriate processes and systems 
are implemented to enable consistent data collation 
and Legal & General group-level consolidation3. 
The results of disposed businesses are included 
up to the date of disposal. 
Base year emissions data from 2021 is included 
to help demonstrate an emissions trajectory. Our 
2021 base year is our SBTi approved base year. This 
includes our LGIM Real Assets 2019 data to account 
for the impact of the pandemic, all other data is 2021.
Reporting standards
Legal & General’s reporting disclosures follow the 
Greenhouse Gas Protocol Corporate Accounting 
and Reporting Standard (GHG Protocol), and the UK 
Government’s SECR requirements4. In line with these 
reporting standards Legal & General disclose scope 1 
and scope 2 carbon emissions. 
Scope 1: Direct carbon emissions occur from 
sources that are owned or controlled by 
Legal & General, for example, emissions from 
combustion in owned or controlled boilers and 
directly owned vehicles.
Scope 2: Indirect carbon emissions from the 
generation of purchased electricity and district 
heating. Legal & General report scope 2 emissions 
in accordance with GHG Protocol guidance: 
a.	 Location-based: the carbon emissions from 
purchased (power) are calculated using the 
national grid average emission conversion factors 
in the countries Legal & General operate within
b.	 Market-based: all electricity purchased is 
converted to carbon emissions using factors from 
contractual instruments which Legal & General 
has purchased or entered into.
Please note that scope 1 and 2 data has been 
subject to independent limited assurance by Deloitte 
and their assurance opinion can be found on pages 
51 to 52 of this report.
Data collection 
In building Legal & General’s scope 1 and 2 carbon 
emissions footprint, internal carbon reporting 
procedures are followed to capture and collate data. 
Data owners, data type and frequency are outlined in 
an internal data dictionary which is used to track data 
collection throughout the annual reporting period. 
Data is collected across the business and aggregated 
to provide a group-wide carbon footprint. All 
underlying data is collated by each business using 
consistent methods of collection, for example 
half-hourly meter readings, utility bills and physical 
meter readings. 
Legal & General’s approach is to use actual data 
where it is practical and feasible to do so. In some 
instances, it may be necessary to use estimated data 
or extrapolated data that is based on data from other 
parts of the business or industry benchmarks. 
For example, we have internal procedures for the 
use of estimates where we do not have access to 
metered or invoiced data within the period
Legal & General use the following industry 
benchmarks: CIBSE TM46 and REEB.
Legal & General utilise a range of data sources 
which are outlined on the following page.
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56

Scope 1 and 2 emissions
continued
Scope 1 carbon emissions:
•	
purchased fuels: invoices and expenses system 
for construction site and on-site generator fuels 
and vehicle fuels 
•	
gas purchased: meter readings, energy contractor 
reports, invoices and estimates based on relevant 
industry benchmarks, such as CIBSE TM46
•	
self-generated electricity: meter readings.
Scope 2 carbon emissions:
•	
electricity purchased: meter readings, energy 
contractor reports, invoices and estimates based 
on relevant industry benchmarks, such as REEB
•	
district heating: energy contractor reports. 
Fugitive emissions (included within scope 1): 
•	
invoices and engineering reports for F-gas 
additions and regulatory ‘F-gas’ registers. 
The data is subject to review and approval by each 
business before being submitted for aggregation 
at the Legal & General group-level. Following 
submission, it is further reviewed by the Group 
environment team to confirm the accuracy and 
reliability of the data submitted and conversion 
factors applied. Queries are raised with data 
owners to address anomalies. 
As stated above, scope 1 and 2 data is subject to 
independent limited assurance by Deloitte, as well 
as internal legal review prior to publication. Checks 
are also undertaken at the half and full year period 
at a group-level, and data is shared with the GEC 
prior to inclusion in annual disclosures. 
GHG emissions conversion factors
•	
Legal & General’s carbon emissions are calculated 
using current and publicly available emission 
conversion factors. Consumption data, such 
as kWh or litres of fuel, is converted into tCO2e. 
The primary source of Legal & General’s emission 
conversion factors are: 
•	
the Department for Energy Security and 
Net Zero (DESNZ)
•	
for international operations in the US, The United 
States Environmental Protection Agency (EPA). 
The DESNZ conversion factors are updated halfway 
through the year and Legal & General apply the 
relevant conversion factor to each associated period1.
For scope 2 market-based methodology, the carbon 
emissions are determined by contractual instruments 
which Legal & General has purchased or entered into 
such as Renewable Energy Guarantees of Origin 
(‘REGO’), power purchasing agreements and utility 
contracts and therefore has a greenhouse gas 
emission factor of zero. There is a period for which 
electricity purchased on a renewable tariff cannot 
be evidenced as REGO-backed, because the REGO 
and Legal & General reporting periods do not align; 
therefore, REGO certificates allocated in a given year 
may not cover all electricity consumption within that 
reporting period. In this instance, a reasonable 
assumption is made for those months of consumption, 
that the electricity consumed is on a renewable tariff, 
as it is within the same contract period. Where REGO 
certificates are unavailable at the date of reporting, 
but the corresponding supplier contractual commitment 
is for 100% of the supply to be REGO backed, the 
relevant usage is reported as REGO-backed. 
Exclusions
Legal & General apply exclusions in accordance with 
the GHG Protocol and the UK Government’s guidance 
on SECR requirements. 
Legal & General’s primary exclusions are joint 
ventures where Legal & General are not the majority 
shareholder or do not have operational control. 
We purchased Taylor Lane, a timber frame 
construction specialist in H2 2023. Due to limited 
access to robust data sets this has been excluded 
from our 2023 footprint and will be included from 
2024. This does not have a material impact on our 
overall footprint.
Restatement of reported data
Legal & General’s expectation is that all data is 
reported accurately and completely. However, given 
the complexities associated with some of the data, 
including the use of estimates, there can be instances 
where it may be necessary to amend data reported 
in prior years, due to the availability of higher quality 
data or a change in the data collating processes. 
Where Legal & General believe there is a material 
impact on previously reported data, the data will 
be restated along with an explanatory note2. 
1.	 Real Assets businesses apply the year-end conversion factor to the 12 month period of collated data, noting that this business reports data from 1 December to 30 November. 
2.	 Either a change of 5% or more from the original stated data or where there is a material impact from the operational business.
Legal & General Group Plc Climate and nature report 2023
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Strategy
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Metrics and targets
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57

Scope 3 emissions
Basis of preparation
Background
As a supporter of the FSB’s TCFD, Legal & General 
commit to disclosing climate-related financial 
information through an annual climate report 
which aligns to TCFD recommendations and is 
supplementary to its Annual report and accounts. 
In line with the UK SECR, Legal & General’s GHG 
information is set out in its Annual report and 
accounts and its accompanying Climate and 
nature report, both published in March. 
Introduction
This basis of preparation document sets out 
how Legal & General prepares its GHG emissions 
reporting for the following scope 3 categories: 
•	
category 3: Fuel and energy-related activities 
•	
category 5: Waste 
•	
category 6: Business travel 
•	
category 7: Employee commuting (home working) 
•	
category 8: Upstream leased assets 
•	
category 13: Downstream leased assets 
•	
category 15: Investments. 
It is the responsibility of Legal & General 
management to ensure that appropriate internal 
procedures are in place to report GHG emissions 
performance data, in all material respects, as set 
out in this document. 
These procedures ensure that:
•	
the reported information reflects 
Legal & General’s performance 
•	
the data is meaningful and is consistent with 
the stated definitions and scope 
•	
any specific exclusions are stated clearly 
and explained 
•	
any assumptions made, as well as accounting 
and calculation methods are clearly described 
•	
the level of transparency is sufficient to enable 
users to have confidence in the integrity of 
Legal & General’s reporting. 
Scope
Legal & General discloses its scope 3 carbon 
emissions (categories 3, 5, 6, 7, 8, 13 and 15) for 
the whole of Legal & General Group, its subsidiaries 
and joint ventures Legal & General follows the 
Greenhouse Gas Protocol Corporate Value Chain 
(scope 3) Accounting and Reporting Standard1,2. 
The carbon emissions data reported is aligned with 
the Group’s financial reporting year, 1 January to 31 
December for categories 5, 6, 7, 8, and 133,4. category 
3 is based on scope 1 and 2 data, category 15 is 
based on January to December of the previous 
year for corporate investments and two years for 
sovereign investments, due to the availability of 
carbon data reporting. Category 13 and 15 emissions 
are based on the investment holdings as at 
31 December (end of reporting year). 
Legal & General include newly acquired businesses 
as soon as the appropriate processes and systems 
are implemented to enable consistent data collation 
and Legal & General group-level consolidation5. 
The results of disposed businesses are included 
up to the date of disposal. 
Where available base year data is included, 
for example from 2021, to help demonstrate 
Legal & General’s emissions trajectory. 
The table on the following page outlines 
Legal & General’s assessment of materiality 
for all categories of scope 3 emissions. 
1.	 Joint ventures are included in the footprint where Legal & General are the majority shareholder, or have operational control.
2.	 Category 15 emissions relate to our shareholder investments, which are defined as total investments to which shareholders are directly exposed, and do not cover our policyholder and external client investments.
3.	 Business travel data is based on business mileage expenses claimed from 1 January to 31 December, rather than actual miles travelled in calendar year. As the engine sizes from employee expenses claims 
are based on internal thresholds and not directly aligned with BEIS engine size thresholds, Legal & General take a prudent approach in applying the higher of BEIS conversion factors for the engine size per 
employee expenses claims.
4.	 LGIM Real Assets data reported annually from 1 December to 30 November.
5.	 We purchased Taylor Lane, a timber frame construction specialist in H2 2023, due to limited access to robust data sets this has been excluded from our 2023 footprint and will be included from 2024. 	
	
Noting this does not have a material impact on our overall footprint.
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Risk management
Metrics and targets
Additional information
58

Scope 3 emissions
continued
Scope 3 coverage
Category
Scope/ description
Description of materiality and our current approach
Key business relevance
Associated target/ commitment
Category 1
Purchased goods  
and services
Relevant to our organisation. We continue to work closely with our 
supply chain and have set a mid-term SBT.
Group-wide
We commit to ensuring that 80% of our suppliers, by spend, will set a 
science-based carbon reduction target by the end of 20261.
Category 2
Capital goods
Relevant to our organisation. We continue to develop standardised 
processes for data collection, with the most material data for LGC 
collected and disclosed on an intensity basis.
LGIM Real Assets  
and LGC
We are committed to reducing the embodied carbon of our homes and 
real estate investments. 
Category 3
Fuel and energy-related 
activities
Relevant to our organisation. Data collated and disclosed for 2023. 
Group-wide
100% of our energy to be purchased from a renewable source.
Category 4
Upstream transportation  
and distribution
Relevant to our organisation. Included in category 1. Data will be 
collated and disclosed from 2024 relevant to CALA (Taylor Lane).
Group-wide
–
Category 5
Waste generated  
in operations
Relevant to our organisation. Data collated and disclosed for 2023.
LGC and core  
occupied offices
We will divert 100% of waste from landfill by 2025 in all offices and LGC 
development projects where we are responsible for waste management. 
Category 6
Business travel
Relevant to our organisation. Data collated and disclosed for 2023.
Group-wide
From 2030, our group-wide business travel will generate net zero 
emissions. 
Category 7
Employee commuting 
(home working)
Relevant to our organisation. Data collated and disclosed for 2023.
Group-wide
–
Category 8
Upstream leased assets
Relevant to our organisation. Data collated and disclosed for 2023.
Group-wide
Our net zero ambition is shaping our future location strategy.
Category 9
Downstream 
transportation  
and distribution
Relevant to our organisation in 2023 but will not be going forward  
due to the closure of our Modular Homes business. 
Legal & General Modular 
Homes
–
Category 10
Processing of  
sold products
Not relevant to our organisation.
n/a
n/a
Category 11
Use of sold products
Relevant to our organisation. We are developing standardised  
processes to capture this data and will disclose in future years.  
Refer to energy use intensity for our housing businesses. 
LGIM Real Assets and LGC
All new homes we deliver, from 2030, will be enabled to operate at net 
zero carbon emissions. 
Category 12
End of life treatment  
of sold products
Relevant to our organisation. We are developing standardised  
processes to capture this data and will disclose in future years. 
LGIM Real Assets and LGC
–
Category 13
Downstream  
leased assets
Relevant to our organisation. Data collated and disclosed for 2023.
LGIM Real Assets and LGC
Legal & General commits to reduce our downstream leased asset GHG 
emissions by 55% per square meter by 2030 from a 2019 base year. 
Category 14
Franchises
Not relevant to our organisation.
n/a
–
Category 15
Investments
Relevant to our organisation. Data collated and disclosed for 2023.
Group proprietary assets
By 2030, reduce portfolio GHG emission intensity by 50% (from a 2019 
base year) and increase financing of low-carbon technology and 
infrastructure.
1.	 We define a target as science-based if it is aligned to SBTi criteria i.e. is a mid-term reduction target with enough ambition to align with the global net zero trajectory.
We would expect this to be between 40-50% reduction depending on the base year.
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Metrics and targets
Additional information
59

Scope 3 emissions
continued
Reporting standards for scope 3 categories
Legal & General follow the Greenhouse Gas Protocol 
Corporate Value Chain (scope 3) Accounting and 
Reporting Standard for reporting scope 3 emissions:
Category 3: Fuel and energy-related activities 
Extraction, production, and transportation of fuels 
and energy purchased or acquired by the reporting 
company in the reporting year, not already accounted 
for in scope 1 or scope 2. 
Category 5: Waste 
Disposal and treatment of waste generated in 
operations in the reporting year (in facilities not 
owned or controlled by Legal & General). 
Category 6: Business travel
Transportation of employees for business-related 
activities during the reporting year (in vehicles not 
owned or operated by the reporting company) 
Category 7: Employee commuting
Department for Energy Security and Net Zero (DESNZ) 
guidance and conversion factors to account for home 
working. Please note this methodology does not 
include a calculation for employee commuting. 
Category 8: Upstream leased assets 
Operation of assets leased by Legal & General 
(lessee) in the reporting year and not included in 
scope 1 and scope 2 as reported by Legal & General. 
Category 13: Downstream leased assets 
Operation of assets owned by the reporting company 
(lessor) and leased to other entities in the reporting 
year, not included in scope 1 and scope 2 – reported 
by lessor.
Category 15: Investments 
Operation of investments (including equity, debt and 
property investments and project finance) in the 
reporting year, not included in scope 1 or scope 2. 
Please note that scope 3 categories 6, 7 and 8 data 
has been subject to independent limited assurance 
by Deloitte and their assurance opinion can be found 
on pages 51 to 52 of this report. 
Data collection 
In building Legal & General’s scope 3 emissions data, 
internal procedures are implemented to capture and 
collate data. Data owners, data type and frequency 
are outlined in an internal data dictionary which is 
used to track data collection throughout the annual 
reporting period. Data is collected across the 
business and aggregated to provide a group-wide 
carbon footprint. All underlying data is collated by 
each business or at a group-level using recognised 
data collection methods, for example supplier 
reports or expenses data. 
Legal & General’s approach is to use actual data 
where it is practical and feasible to do so. In some 
instances, it may be necessary to use estimated data 
or extrapolated data that is based on data from other 
parts of the business or industry benchmarks. For 
example, Legal & General use the DESNZ guidance 
and metrics to account for carbon emissions from 
employees working from home. 
Scope 3 data is subject to review and approval by 
each business before being submitted for 
aggregation at the Legal & General group-level. 
Following submission, it is further reviewed by the 
Group environment team to confirm the accuracy and 
reliability of the data submitted and conversion 
factors applied. Queries are raised with data owners 
to address anomalies. 
Scope 3 categories 6, 7 and 8 data is subject to 
independent limited assurance by Deloitte. All scope 3 
data is subject to internal legal review prior to 
publication. Checks are also undertaken at the half 
and full year at a Group-level and data is shared with 
the GEC prior to inclusion in annual disclosures. 
Legal & General utilise a range of data sources in the 
measurement of scope 3 emissions, which are 
outlined below. 
Category 3: Fuel and energy-related activities:
DESNZ guidance and conversion factors are applied 
to the data collected for the annual scope 1 and 2 
footprint.
Category 5: Waste
•	
calculated based on data collected by business 
areas broken down, as a minimum, to the 
following disposal routes: 
–	 Recycling 
–	 Energy from waste
–	 Composting
–	 Landfill
•	
data is subject to review and approval by each 
business before being submitted for aggregation 
at the Legal & General group-level. Following 
submission, it is further reviewed by the Group 
environment team and conversion factors applied 
by waste type. Queries are raised with data 
owners to address anomalies. 
Category 6: Business travel:
•	
data is collected on the following modes 
of business travel: road-based mileage; air travel 
distance; rail travel distance
•	
where possible distance (miles or kilometres) 
are used. A distance-based method involves 
determining the distance and mode of business 
travel, then applying the appropriate emission 
factor for the mode used 
•	
the following data is collected:
–	 type of travel (for example emissions factors 
vary by distance and class of travel) 
–	 specific types and size of vehicles used for 
travel (since transportation emission factors 
vary by vehicle types) from transport providers
–	 the specific passenger vehicle type and fuel 
used (since transportation emission factors 
vary by fuel types).
•	
where distance data is not available a spend-based 
method is used. This involves determining the 
amount of money spent on each mode of business 
travel transport and applying a primary conversion 
factor to convert to distance and then a standard 
conversion factor to determine emissions1 
•	
third-party travel booking providers, as part of 
contractual agreements, provide travel data on 
journeys undertaken 
•	
information is collated from central and 
businesses expenses systems 
•	
data is collated at group-level following a review 
by the Group environment team and conversion 
factors applied. Queries are raised with data 
owners to address anomalies.
Category 7: Employee commuting (homeworking)
•	
the DESNZ guidance and conversion factors are 
used to calculate homeworking emissions for 
employees2. Energy use from office equipment 
and home heating, which would not have occurred 
in an office-working scenario is accounted for 
•	
assessment of homeworking is based on UK 
regions, as the majority of employees are located 
in the UK and there are currently no emissions 
factors for homeworking in other countries. 
Therefore, all employee home working emissions 
are calculated using the UK emissions factors.
1.	 UK Government guidance and conversion factors are applied.
2.	 Employees defined as Full-Time Employee equivalent (annual average).
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60

Scope 3 emissions
continued
Please note, Legal & General do not currently collate 
information on employee commuting, although we 
do collate the carbon from shuttle buses provided 
by Legal & General. This is captured within scope 3 
Category 6. 
Category 8: Upstream leased assets
•	
an average data method is used to estimate 
emissions from leased buildings. This means 
estimating emissions for each leased asset, 
based on average data, such as average 
emissions per asset type or floor space 
•	
this method has been selected because purchase 
records, electricity bills, or meter readings of fuel 
or energy use are not available or applicable 
•	
the following information is used: 
–	 floor space of each leased building (where not 
available average head counts are used and the 
following calculation applied to determine floor 
space headcount x 7m2 = total m2 1)
–	 the BBP REEB are used to calculate gas (kwh) 
and electricity (kwh)
–	 appropriate DESNZ emissions factors are 
then applied. 
Category 13: Downstream leased assets
Where we do not manage our properties, our 
occupiers provide utility data, or we use benchmark 
data-based upon property type and floor area. 
We use the following benchmark data sources: 
•	
Global Real Estate Sustainability Benchmarking 
(GRESB) occupier data collection. As part of our 
occupier liaison processes, we currently receive 
operational data from a proportion of our 
occupiers.
•	
industry standard benchmarks: Chartered 
Institute of Building Services Engineers (CIBSE) 
and BBP REEB. Energy (and carbon) benchmarks 
for various types of property have been published 
in the UK for over 20 years, originating from the 
government-funded Energy Efficiency Best 
Practice Programme (EEBPP). The most recent 
update to these benchmarks was undertaken 
by CIBSE in 2008
•	
in addition, the BBP has established more recent 
benchmarks for particular types of commercial 
buildings, predominantly offices and shopping 
centres. REEB 2020 office benchmark was used 
for this analysis.
By using a combination of these benchmarks, we 
establish an estimate of the carbon emissions 
associated with our direct property investments and 
also identify which property sectors are, on average, 
most intensive in terms of carbon emissions.
Conversion factors 
Legal & General’s carbon emissions are calculated 
using publicly available emission conversion factors. 
Consumption data, such as kWh or litres of fuel, is 
converted into tonnes of CO2e. The primary source 
of Legal & General’s emission conversion factors 
is the Department for Energy Security and Net Zero 
(DESNZ)2. The DESNZ conversion factors are also 
applied to travel and serviced offices within 
international countries. 
Exclusions
Legal & General apply exclusions in accordance with 
the GHG Protocol and the UK Government’s guidance 
on SECR requirements. 
Legal & General’s primary exclusions are joint 
ventures where Legal & General are not the majority 
shareholder or do not have operational control. 
In some instances where it has not been possible 
to obtain relevant data or Legal & General are not 
able to apply an appropriate and valid estimation, 
Legal & General have excluded that from our 
reporting until it can be appropriately measured4. 
Restatement of reported data
Legal & General’s expectation is that all data is 
reported accurately and completely. However, given 
the complexities associated with some of the data, 
including the use of estimates, there can be instances 
where it may be necessary to amend data reported 
in prior years, due to the availability of higher quality 
data or a change in the data collating processes. 
Where Legal & General believe there is a material 
impact on previously reported data, the data will 
be restated along with an explanatory note3. 
Category 15: Investments
Legal & General’s category 15 data is made up of 
Legal & General ownership share of the financed 
emissions related to Legal & General’s on-balance-
sheet proprietary asset portfolio (referred to as 
‘Group proprietary assets’). It includes bonds, 
equities, and investment property, but excludes cash, 
derivatives, or any assets already covered in our 
operational footprint. 
Legal & General’s primary metric is the GHG economic 
emissions intensity of the portfolio of Group 
proprietary assets. This is the total of all the GHG 
produced by our share of the companies and 
corporations that we invest in, per unit of investment, 
and is reported using carbon dioxide equivalent 
(CO2e) emission data. There are three components 
to this metric: 
•	
the GHG emissions, CO2e, in tonnes for each 
entity in which we are invested arising from 
the underlying scope 1 and scope 2 emissions 
directly connected with its operations 
•	
a unit of value to normalise the emissions by the 
underlying size of the entity we are investing in 
measured in £m. For our primary metric we use: 
–	 EVIC for corporate issuers 
–	 sovereign capital stock for sovereigns 
–	 market valuation for each real asset investment 
•	
the size of our holding in the entity.
The investment portfolio emissions intensity is then 
calculated by weighting the normalised emissions 
(tonnes of CO2e emissions per £m normaliser entity 
value as defined above) by the size of our investment 
and aggregating all holdings in our investment portfolio. 
Where third-party data is not available, we have 
adopted several proxy approaches with the aim of 
filling the coverage gap. For some key asset classes, 
asset class-specific approaches are employed, while 
for others that are not covered in our datasets, we use 
sector-based proxies. Proxy approaches are used for 
the following other asset classes: real assets, lifetime 
mortgages, private debt and private equity. 
Our calculation methodology for our primary 
economic carbon intensity metric aligns with 
(unless stated):
•	
PCAF stock emission intensity methodologies 
(that is to say using EVIC as the stock emission 
intensity normaliser), where available. Known 
deviations from the PCAF methodologies are 
stated below
•	
TCFD’s carbon footprint portfolio weighting 
methodology (that is to say stock intensities 
are weighted by portfolio value). 
This year, we have also broken the portfolio score 
down by asset class and industry sector within this 
report, in line with PCAF guidance.
1.	 7m2 is sourced from the UK Government Employment Densities Guide 2010, which Legal & General use for space planning purposes.
2.	 The UK Government conversion factors are updated halfway through the year and Legal & General apply the conversion factor for the year-end period to the full years data. 
3.	 Either a change of 5% or more from the original stated data or where there is a material impact from the operational business.
4.	 We purchased Taylor Lane, a timber frame construction specialist in H2 2023, due to limited access to robust data sets this has been excluded from our 2023 footprint and will be included from 2024. 
Noting this does not have a material impact on our overall footprint.
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Note, for each years’ calculations the emissions and 
revenues data refer to the most recently available 
reported carbon footprint scores and revenue 
information (which generally contains a one-year 
lag for listed equity and debt, and two-year lag for 
sovereigns). For example, the emissions (tCO2e) and 
revenue data would generally refer to 2022 for the 
2023 metric. 
PCAF data quality assessment 
From 2023 onwards, Legal & General has 
implemented the PCAF data hierarchy system and 
will disclose the portfolio data quality scores1.
The resulting data coverage in relation to the 
investment portfolio emissions intensity is disclosed 
within this report accordingly. 
Known data limitations 
When it comes to emissions data, we rely on 
third-party databases (such as Institutional 
Shareholder Services, ISS) and the associated data is 
subject to the each providers’ quality considerations.
The use of portfolio sector averages is used in some 
cases where emissions date does not exist. This 
sector mapping is currently carried out at ‘BICS 
legacy level 1’, as a pragmatic approach on the 
grounds of current modelling capacity and data 
availability. This may present a limitation as issuers 
of holdings could have multiple industry sectors, or 
the holdings could be the most relevant to an unlisted 
subsidiary of a listed parent of multiple sectors.
Known deviations from the PCAF 
methodologies 
We note the following key deviations in 
Legal & General financed emissions from 
requirements in PCAF standards.
•	
ISS is LGIM’s primary carbon data platform 
•	
corporate normaliser data: 
–	 ‘EVIC’ scores, used to normalise the emission 
scores within the Investment portfolio 
economic carbon intensity calculation, are 
provided by Refinitv 
–	 ‘revenue’ scores, used to normalise the 
emission scores within the investment portfolio 
WACI calculation, are provided by ISS 
•	
carbon emissions and revenue data have a 
one-year lag. 
Sovereigns
For government bonds we also follow a data-driven 
approach, as follows: 
•	
production based GHGs (ISS): GHGs within the 
country border per calendar year is the numerator
•	
divisor: total capital stock per calendar year (IMF) 
used for the economic intensity calculation – 
tCO2e/£m invested (broadly comparable to 
tCO2e/£m EVIC for corporate bonds) 
•	
GDP per calendar year (ISS) used for the 
revenue-based calculation – tCO2e/£m GDP 
(broadly comparable to tCO2e/£m revenue for 
corporate bonds) 
•	
government carbon emissions data has a 
two-year lag.
Unscored credit and equity (both listed 
and unlisted) 
We utilise a selection of methodologies, in the order 
of preference/ availability, for these holdings 
depending on their exposure and type: 
1.	 sourcing directly from companies’ annual 
or sustainability reports with reference to the 
PCAF guidance
2.	 based on third-party datasets such as ISS, IPCC 
or PCAF database 
•	
we do not currently include the scope 3 emissions 
of our investee companies, primarily due to the 
challenges of producing meaningfully comparable 
data across the highly diverse set of industries 
in which we invest 
•	
we use total capital stock as the stock emission 
intensity normaliser for sovereign bonds within our 
full portfolio calculation, as opposed to adjusted 
GDP, as the economically more comparable 
normaliser to EVIC used for other asset classes.
Consideration of scope 3 category 13 and 
category 15 assets 
There is a portfolio of properties where LGIM Real 
Assets acts as the landlord whilst LGRI takes direct 
ownership. The investment portfolio emissions and 
related financed emissions intensity arising from 
such property holdings are reported as scope 3 
Category 15, and not as scope 3 Category 13, 
avoiding duplication in reported metrics.
To note, the physical carbon intensity (tCO2e/m2) for 
this property portfolio is reported within both scope 3 
Category 13 and Category 15 calculations.
Scope 3 investment portfolio carbon footprint: 
underlying data approach 
ISS data provides a coverage of £26.8 billion of our 
corporate portfolio, and £7.9 billion of our sovereign 
portfolio (c.39% direct coverage of 2023 portfolio). 
The following categories cover the approach to each 
asset class, including the techniques we apply to 
estimate and proxy carbon emissions in the absence 
of third-party emissions data. 
Corporate credit and listed equity 
The carbon footprint calculation for this asset class 
is purely data-driven, using our predominant data 
providers as follows: 
3.	 mapping to listed parent company with carbon 
disclosure 
4.	 mapping to a suitable stock proxy in the ISS 
database 
5.	 assigning a scored portfolio sector average, 
based on the BICS. 
Property 
The carbon analysis of our property portfolio is based 
on a number of sources. Where we are responsible 
for the utility procurement, operation and management 
of our properties, through our managing agents, we 
obtain energy and environmental data directly from 
site utility meters or from utility suppliers. Where we 
do not manage our properties, our occupiers provide 
utility data, or we use benchmark data based upon 
property type and floor area. We use the following 
benchmark data sources: 
•	
offices and shopping centre: BBP’s REEB2 
•	
all other property types: Chartered Institute 
of Building Services Engineers (‘CIBSE’)3 
By using a combination of these benchmarks, 
we establish an estimate of the carbon emissions 
associated with our direct property investments and 
also identify which property sectors are, on average, 
most intensive in terms of carbon emissions. 
Scope 3 emissions
continued
1.	 www.carbonaccountingfinancials.com/files/downloads/PCAF-Global-GHG-Standard.pdf
2.	 www.betterbuildingspartnership.co.uk/our-priorities/measuring-reporting/real-estate-environmental-benchmark
3.	 www.documents.pub/document/cibse-tm-46-energy-benchmarks
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For commercial property, our operational footprint 
(scope 1 and 2) includes assets that are owned 
and managed in connection with our businesses. 
This includes all assets we occupy where we procure 
energy but also includes assets owned and managed 
by us, i.e. where we procure energy on behalf of 
external occupiers. The Group scope 3 calculation 
additionally brings in the emissions associated with 
occupier energy use. 
LTMs 
Our approach to LTMs is based on an analysis 
of the lending by purpose and is mapped to the 
portfolio sector average for the ‘consumer 
non-cyclical’ industry.
Other assets 
We have assumed that no emissions apply 
to the cash and derivative exposures.
Data quality calculation detail
Data source 
Third-party data sources are available to provide 
underlying data sources of the financed emissions 
intensity. In addition, ISS provides the data collection 
approach that we can use to determine PCAF data 
quality score for companies, which have been 
calculated for the first time this year. The database 
includes a brief description relating to the quoted 
source of carbon emissions data, including 
‘Sustainability or Annual Reports’, ‘UNFCCC’ 
and ‘CDP’. This enables us to derive an approach 
combining the carbon proxy approach as well 
as the (ISS) carbon data source description.
Data quality score assignment
The data quality scoring approach is set up for 
compliance with PCAF data quality scoring system 
on best endeavour basis. See below table for the 
PCAF data quality score card. 
ISS/ carbon data 
source description
Legal & General carbon 
proxying approach 
PCAF  
Score assigned Reason for score 
CDP 
ISS-based 
(corporate holdings) 
2
ISS company carbon data sourced from 
CDP disclosure
Sustainability or Annual 
Reports
ISS-based 
(corporate holdings) 
2
ISS company carbon data sourced from 
sustainability or annual reports 
UNFCCC1 
ISS-based 
(sovereign bonds) 
1
ISS sovereign carbon data sourced from 
UNFCCC 
Other Reported
ISS-based 
(corporate holdings)
2
ISS company carbon data sourced from 
other reported source
CAIT2
ISS-based 
(sovereign bonds)
2
ISS sovereign carbon data sourced from 
CAIT
CDP
Industry sector average 
score mapped with 
BICS level 1
3
ISS company/ sovereign carbon 
data available but no EVIC data available 
hence industry sector average score used
Sustainability or Annual 
Reports
Other Reported
Modelled Emissions
CAIT
NULL
No match found in carbon dataset hence 
industry proxy set as final footprint score
Modelled Emissions
ISS-based (corporate 
holdings)
3
ISS company carbon data based 
on modelled emissions
NULL
Investment Cash Proxy
5
Investment cash-like items with 
carbon intensity score proxied 
on Legal & General liquidity fund 
average score
NULL
Manual Proxy
1 to 5
Score manually sourced from multiple 
data sources hence data quality 
score allocated in line with the rest 
of this table
NULL
Not Scored
5
No match found in carbon dataset, 
no manual proxy applied and no 
BICS sector found hence holdings 
remain unscored
Actual building energy 
consumption and supplier-
specific emission factors
Property
1
Collected directly from landlords or 
occupiers3
Offices and shopping 
centre: BBP’s REEB. All 
other property types: CIBSE
Property
4
Apply to benchmark scores dependent 
on building type and floor area3
Table 14. General data quality scorecard 
Certain 
(5-10% error 
margin in 
estimations)
Score 1
Audited GHG 
emissions data 
or actual primary 
energy data
Score 2
Non-audited GHG 
emissions data 
or other primary 
data
Score 3
Average data 
that is peer/ 
(sub)-sector 
specific
 
Score 4
Proxy data on 
the basis of 
region or country
Uncertain 
(40-50% error 
margin in 
estimations)
Score 5
Estimated data 
with very limited 
support
Scope 3 emissions
continued
1.	 www.unfccc.int/topics/mitigation/resources/registry-and-data/ghg-data-from-unfccc
2.	 www.wri.org/data/climate-watch-cait-country-greenhouse-gas-emissions-data
3.	 Based on PCAF data quality score table for Commercial Real Estate, see: www.carbonaccountingfinancials.com/files/downloads/PCAF-Global-GHG-Standard.pdf
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There are specific entity-level disclosure requirements, 
both for the US and UK. For the UK these include the 
new rules and guidance introduced by the FCA for 
asset managers and certain FCA-regulated asset 
owners to make mandatory disclosures consistent 
with TCFD recommendations­. Our Workplace and 
Retail Savings business areas sit within our Retail 
division and have entities that fall within scope of the 
regulations. While we typically manage our response 
to climate change at a group-level, below are 
disclosures relevant to specific legal entities including 
Legal & General Assurance Society Ltd (LGAS) our 
insurance entity, Legal & General Portfolio Management 
Services Limited (PMS) our investment entity and 
Legal & General America (LGA) our insurance entity 
in the US. Below sets out which legal entities our 
business units conduct their activities via:
Workplace 
The business area that provides product management 
and governance support for workplace members and 
conducts its activities via LGAS and PMS.
Retail Savings 
The business area that provides product management 
and governance support for our retail policyholders 
in ISA and individual pension products and conducts 
its activities via LGAS and PMS.
Strategy
Our Workplace business uses LGIM as its primary 
asset manager, making day-to-day investment 
decisions in relation to funds. Workplace shares 
LGIM’s core investment beliefs relating to climate 
change, including where LGIM applies a consistent 
approach to voting and engagement, pursuing 
innovation in tackling climate change, modelling 
energy transition, and targeted engagements. Our 
Workplace business supports LGIM’s short- and 
long-term targets, and both LGIM and Workplace 
have published net zero targets for 2050, for the key 
standard default investment options. Both 
businesses work together, to utilise relevant expertise 
and ensure their investment principles remain 
aligned. When setting commitments, Workplace 
uses time horizons as defined by LGIM and 
Legal & General Group climate risk structures.
 
Scenario analysis is conducted at an asset class 
level for internal LGIM funds, by LGIM as the primary 
asset manager. 
Initial Entity and Product level reports were 
successfully produced by 30 June 2023, and we 
envisage that the Workplace and Personal Investing 
approach to measuring and assessing climate risk 
will continue to evolve.
The Workplace business publishes a Statement of 
Investment Principles for its products, the Group 
Stakeholder and WorkSave Pension Plan. These 
Principles have been updated to reflect TCFD. 
Governance
For our UK legal entities, the Boards of our insurance 
entity, LGAS, and our investment entity, PMS, formally 
delegate the oversight of TCFD products (unit-linked 
funds and pre-set investment portfolios) to the Fund 
Risk Oversight Committee (FROC), which meets at 
least quarterly. This delegation includes climate 
reporting responsibilities. Climate metrics now form 
a new element of governance for the FROC. Climate 
risk is reported up to the LGAS and PMS Boards at 
least annually.
As the insurer, LGAS has the ultimate responsibility 
for funds made available across Workplace 
products. However, trustees of trust-based pension 
arrangements remain responsible for ongoing 
investment governance for the funds they make 
available to their members.
Climate risk is an increasingly important factor 
in governance of the house default investment 
options (in the triennial reviews conducted by the 
Workplace business).
LGA, aligns its climate risk strategy to that of its 
parent, the Group. Climate risks, both physical 
and transition risks, are most relevant to LGA’s 
investment strategy and a framework has been 
developed to identify and escalate these risks.
Risk management
For our UK legal entities, group-level climate risk 
management is cascaded down to all of our 
businesses. Our Workplace and Retail Savings 
businesses engage with LGIM as their primary 
asset manager, to obtain climate data and to conduct 
scenario analysis within product level reports. This 
information is an integral part of their climate risk 
management process and an area our individual 
businesses expect to develop their understanding 
of over time.
For Workplace and Retail Savings businesses, the 
setting of commitments and targets, Exclusions 
Policy, CIP and Active Ownership policies are 
managed by the primary asset manager, LGIM. 
Reliance is placed on group-level committees to 
advise on the climate risk of business in relation to 
legal, technology, market, reputational and physical 
risks, for ongoing management of LGIM funds.
As providers of unit-linked pension funds, our 
Workplace and Retail Savings businesses are not a 
direct shareholder in any investee companies, and 
instead invests in underlying funds which in turn will 
invest into other funds or hold securities such as 
company shares.
For the US, LGA leverages the Group’s risk 
management framework and has its own Climate 
Risk Committee which has been a sub-committee 
of the LGA Board since May 2023. The primary role 
of the LGA Climate Risk Committee is to ensure that 
adequate governance and oversight is in place for the 
assessment and management of the financial risks 
associated with climate change. The LGA Climate 
Risk Committee includes LGA executive sponsorship 
and representatives from both the Protection and 
Pension Risk Transfer businesses. A non-executive 
director of the LGA Board and a representative from 
the Group Climate team serve on this committee in 
an advisory capacity.
Metrics and targets
For our UK legal entities, initial entity and product-
level reports were successfully produced by 
30 June 2023. Product-level reports cover in-scope 
funds and lifestyle profiles. The reports can be found 
at: www.legalandgeneral.com/workplace-dc/tcfd/. 
We envisage that the Workplace and Retail Savings 
approach to climate risk will continue to evolve.
In the first year of reporting Workplace did not 
provide separate TCFD product-level reports for 
funds managed by external fund managers. As data 
methodologies mature and become consistent and 
as Sustainability Disclosure Requirements mandate 
further disclosure, it is expected that this area will 
develop and enable greater transparency. TCFD 
metrics are now used as a quantitative measure of 
climate risk to support some governance decisions, 
for example, when assessing funds in light of new 
anti-greenwashing rules, and as an element within 
the recent Workplace house default triennial review.
For LGA, metrics are aligned to those used by Group 
and LGA provides relevant information to group to 
enable measurement and management of its overall 
performance with respect to these metrics.
Entity-level disclosures
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The metrics, particularly targets, projections, forecasts 
and other forward-looking metrics used in this report 
should be treated with caution, in particular given the 
uncertainty around the evolution and impact of climate 
change and around broader factors, such as impacts 
and dependencies on nature.
These metrics include but are not limited to 
estimates of historical emissions and of historical 
climate change and forward-looking climate and 
nature-related metrics and estimated climate and 
nature-related projections and forecasts.
1.	 The topics addressed in this report such as 
climate change, impacts and dependencies on 
nature and associated risks cannot be evaluated 
in the same way as more conventional financial 
risks. Primary reasons for this include:
–	 their unprecedented nature and complexity; 
the fact that projections of climate change and 
temperature and impacts on nature are long 
term as scenarios that play out over at least 
several decades and are therefore inherently 
more uncertain
–	 understanding about how different climate 
and nature-related risks could interact 
continues to evolve
–	 climate-related and nature-related risks may 
also interact with non climate-related risks and 
vulnerabilities and compound impacts in ways 
not currently anticipated 
–	 climate change, and impacts on nature and 
biodiversity-loss, and their related risks may 
be irreversible if certain limits are exceeded
–	 because the physical and transition risks are 
novel, they differ from the perspective of 
conventional risk identification, measurement 
and management (which generally focus on 
extreme events with a basis in prior experience) 
and the outcomes are thus more uncertain.
This leads to significant uncertainties, assumptions 
and judgements underlying the metrics included in 
this report that limit the extent to which they can be 
relied on.
2.	 The lack of reliable, accurate, verifiable, 
consistent and comparable data relating to 
climate and nature makes it challenging to 
accurately disclose or estimate metrics used 
to assess associated risk and opportunities. 
In particular:
–	 finding the sources for relevant required data 
remains a challenge as does validating and 
standardising that data 
–	 metrics and data, the models and supporting 
scenarios included in this report and the 
measurement technologies, analytical 
methodologies and services that support them, 
continue to develop.
3.	 There is a lack of standardisation, transparency 
and comparability of disclosure with many 
diverging disclosure frameworks and 
methodologies for calculating climate and 
nature-related metrics, in particular, leading to 
metric estimates that are not directly comparable. 
These differences are compounded by a lack of 
international coordination on data and 
methodology standards. Even where 
methodologies are publicly described, differences 
across data providers can still make resulting 
disclosures difficult to compare for investors and 
others evaluating climate exposure across their 
holdings. In addition, the methodologies for 
estimating and calculating GHG emissions or 
emission intensities and other climate-related 
metrics vary widely in their approaches. This 
could lead to under or over estimation of implied 
temperature rises and the attendant climate risks.
4.	 Metrics included in this report may require many 
methodological choices, estimates, judgements 
and assumptions about climate change, impact 
on nature, policies, technologies and other 
matters that are uncertain or not yet known.
5.	 Any material change in these variables may cause 
the assumptions and therefore, the metrics and 
data based on those assumptions, to be incorrect.
6.	 Climate scenarios are not forecasts; rather they 
are projections of alternative plausible futures 
that are designed to build an understanding of the 
nature and size of changes that may occur in the 
future. They do not reflect all possible future 
pathways and, given their long-term nature, are 
inherently uncertain. These points will also remain 
relevant, as we start to expand our analysis to 
cover nature-related variables. In particular: 
–	 these scenarios and the models that analyse 
them have limitations that are sensitive to key 
assumptions and parameters 
–	 these scenarios cannot capture all of the 
effects of climate and nature-related policy 
and technology-driven outcomes
–	 scientific understanding of climate change 
and impacts and dependencies on nature 
continues to develop 
–	 models cannot fully capture the range of 
societal changes that could result from climate 
change and from nature-related issues
–	 over-reliance on a limited number of the same 
prescribed models or scenarios may amplify 
systemic climate-related and nature-
related risks.
7.	 This report and the information contained 
within it is unaudited¹. Further development of 
accounting and/ or reporting standards could 
materially impact the metrics, data points and 
targets contained in this report. As standards 
and practices continue to evolve, it may mean 
subsequent reports do not allow a reader to 
compare metrics, data points or targets from one 
reporting period to another on a direct like-for-like 
basis. In addition, the Group’s climate risk 
capabilities and net zero transition strategy 
and plan and approach towards nature-related 
issues remain under development and the data 
underlying these and market practice in relation to 
the disclosures made in this report will evolve over 
time. As a result, certain of such disclosures are 
likely to be amended, updated, recalculated and 
restated in future reports.
1.	 This is with the exception of scope 1, scope 2, and scope 3 (categories 6, 7 and 8) metrics, which have been subject to independent 
limited assurance by Deloitte (see pages 51 to 52).
Cautionary statement
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8.	 Any opinions or views of third-parties expressed 
in this report are those of the third-parties 
identified and not of the Group, its affiliates, 
directors, officers, employees or agents. By 
incorporating or referring to opinions and views 
of third-parties, the Group is not, in any way, 
endorsing or supporting such opinions or views.
9.	 While all reasonable care has been taken 
in preparing this report, neither the Group nor 
any of its affiliates, directors, officers, employees 
or agents make any representation or warranty 
as to its quality, accuracy or completeness and 
they accept no responsibility or liability for the 
contents of this material, including any errors 
of fact, omission or opinion expressed. Some of 
the information that appears in this report may 
have been obtained from public and other sources 
and, while the Group believes such information is 
reliable, it has not been independently verified by 
the Group and no representation or warranty is 
made by the Group as to its quality, completeness, 
accuracy, fitness for a particular purpose or 
non-infringement of such information.
10.	This report contains forward-looking statements 
and metrics, such as targets, climate scenarios 
and emissions intensity pathways, estimated 
climate and nature-related projections and 
forecasts. Words or phrases such as ‘anticipate’, 
‘effort’, ‘estimate’, ‘believe’, ‘budget’, ‘continue’, 
‘could’, ‘expect’, ‘forecast’, ‘goal’, ‘guidance’, 
‘intend’, ‘may’, ‘objective’, ‘outlook’, ‘plan’, 
‘potential’, ‘predict’, ‘projection’, ‘seek’, ‘should’, 
‘target’, ‘will’, ‘would’ or similar expressions that 
convey the prospective nature of events or 
outcomes generally indicate forward-looking 
statements.
The many significant uncertainties, assumptions, 
judgements, opinions, estimates, forecasts and 
certain non-historical data underlying forward-
looking metrics (such as carbon and other 
emissions metrics) and metrics to assess 
climate-related or nature-related risk and 
opportunity outside of carbon exposure may 
limit the extent to which these climate-related 
or nature-related metrics are used to better 
understand risk and evaluate progress towards 
established strategies, targets, objectives and 
commitments and could cause actual results, 
performance or events to differ materially from 
those expressed or implied in such statements. 
Any opinions and estimates should be regarded 
as indicative, preliminary and for illustrative 
purposes only. The expected and actual 
outcomes may differ from those set out in this 
report. It is possible that the assumptions drawn 
and the judgements exercised may subsequently 
turn out to be inaccurate. The judgements and 
data presented in this report are not a substitute 
for judgements and analysis made independently 
by the reader.
The statements in this report are based on 
current plans, expectations, estimates, targets 
and projections and are subject to significant 
uncertainties and risks and can be affected by 
other factors which may result in the Group being 
unable to achieve the current plans, expectations, 
estimates, targets or projections. Accordingly, 
undue reliance should not be placed on 
these statements.
Factors which may cause actual results, 
performance or events to differ materially from 
those expressed or implied in the forward-looking 
statements include (but are not limited to):
•	
changes in environmental, social or physical risks
•	
legislative, regulatory and policy developments, 
including those addressing climate change or 
impacts on nature and the way in which and 
speed at which those developments take place
•	
the development of standards and interpretations, 
including evolving practices in ESG and 
climate reporting
•	
the ability of the Group, with government and 
other stakeholders, to mitigate the effects of 
climate change and impacts on nature effectively
•	
the delivery of policy actions and achievement 
of climate reduction targets and any nature-
related targets by companies in which the Group 
invests and in the wider economy.
Please see the Group’s latest Annual report and 
accounts for further details of risks, uncertainties 
and other factors relevant to the business.
Any forward-looking statements made by or on 
behalf of the Group speak only as of the date they 
are made and, unless legally required, the Group 
assumes no obligation to publicly update or revise 
any forward-looking statement, whether as a 
result of new information or for any other reason.
11.	The information, statements and opinions 
contained in this report do not constitute an offer 
to sell or buy or the solicitation of an offer to sell 
or buy any securities or financial instruments nor 
do they constitute any advice or recommendation 
with respect to such securities or other financial 
instruments or any other matter.
Cautionary statement
continued
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Strategy
Scenarios
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