MENU > Pensions > Investment options > Investing responsibly Investing responsibly Your pension is powerful. Let's invest it responsibly. The world has you thinking your pension sits there, waiting for a rainy day. But that couldn’t be further from the truth. Pensions are active. Pensions are invested on your behalf. And when invested properly they can help to make the world a better place. We’re committed to acting and investing responsibly for you, and by you we mean the Invested Generation. We’re a modern mutual with purpose, dedicated to making sure your pension and your principles are in safe hands. We aim to grow your money, while also making a positive impact on our society and environment – to help you retire into a future worth living in. Download our 'Investing responsibly with us' brochure (PDF 597KB) to get the details. How your pension can make a difference Video Transcript Welcome to the start of a new generation, the Invested Generation Your pension is invested in the companies shaping the world’s future. It might be the most money any of us will ever have invested in our lifetimes so it’s only right it gets used to help make positive change. We don’t have shareholders, but as a leading investor we are a shareholder in other companies. So, we can share our customers’ opinions and influence important policies all because of your pension. The bigger your shareholding, the more influence you can have, it’s as simple as that. This puts large pension companies, like us, in a strong position to make a difference on your behalf – from helping to drive the move to a low carbon economy to advocating for more diverse workforces. When we say your pension is powerful, we mean it. We aren’t just talking about your future financial security, but as a way of championing for the world you want to live in. It’s all extremely exciting when you think about it. It’s what being part of the Invested Generation is all about. Wanting your investments to do well and to do good. How we collaborate with others Find out how collaboration and engagement works when you’re investing in a company. And how we do it on your behalf. Get the detail The journey of your pension money Ever wondered what your pension gets up to after it leaves your pay packet? View our handy infographic Responsible investment case studies Read our case studies to discover how the Responsible Investment team at Royal London Asset Management (RLAM) engages with companies to influence and create change. Read the case studies The difference is down to the decision-making We know you care about making more responsible choices, which is why environmental, social and governance (ESG) factors are included in the investment decisions we make. This is not the time to be passive, it’s the time to come together as the Invested Generation. As the UK’s largest mutual insurance and pension provider, we’re committed to acting and investing responsibly. We choose the asset managers that look after your investments in a responsible way and ask them to consider environmental, social and governance issues in their decision-making. We also aim to act on your behalf to influence and challenge the companies you own shares in, on issues such as CO2 emissions, modern slavery policies, and executive pay. “Our ultimate goal is to use our position as shareholders or bondholders to have a positive influence on behaviour, because we think that is in the best long-term interests of our clients.” Ashley Hamilton Claxton, Head of Responsible Investment, Royal London Your money is making good things happen Video transcript If you’re invested in our Governed Range (where most of our pension customers are invested) you can feel assured that your investments are helping to tackle climate change. Find out more Climate change as a key issue We work actively with the companies that we invest in. So we can influence their plans to reduce their carbon emissions and transition to a sustainable world in a way that considers the impact on society. We’ve made climate change commitments to tackle and minimise the impacts of climate change, both through how we work as well as the investments we make. Action we’ve already taken to help build a better future We’ve made climate commitments Learn more about We’ve made climate commitments We’ve evolved our default investment Learn more about We’ve evolved our default investment We've collaborated with many companies to improve ESG factors Learn more about We've collaborated with many companies to improve ESG factors We use our vote to create change Learn more about We use our vote to create change We’re building social enterprises Learn more about We’re building social enterprises We apply active governance to look after your money Learn more about We apply active governance to look after your money Together for good We're signatories to these climate initiatives: Frequently asked questions What does ESG stand for? What's your position on climate change? What are the Principles for Responsible Investment (PRI)? What is the UK Stewardship Code? Is Royal London a signatory of the UK Stewardship Code? Are there any places you won't invest? How can I see how asset managers are voting? ESG stands for Environmental, Social and Governance, which are three key factors that help investors measure the ethical and sustainability impact of a business or sector. When looking at the first factor for example, an investor would examine what damage a company is doing to the environment. Is it causing pollution? If it’s a chemical company, does it have a history of leaks or spills? And does it clean up after itself? If it’s an oil or gas company, is it extracting as cleanly as possible? And what are its carbon capture plans or energy transition plans? How is it planning to change in future years? The social element involves finding out if a company is looking after people and not exploiting anyone. Does the company care for its employees, its suppliers, customers and the communities that it is involved with? For companies with employees and suppliers in developing countries, where employment law can be less formal, this is particularly important. Governance is about how well companies are run. Do they follow all the legal and accounting requirements? Are they carrying out thorough audits, and do they have all the necessary checks and balances in place? What’s their attitude to company pay and executive bonuses? Do they always put their shareholders’ interests first? Are they as open with shareholders as possible? An investor who is ESG aware will want to know that these credentials are strong before investing. Shareholder Rights Directive II - (SRD II) We invest £108bn* on behalf of our customers, of which around a third is invested in the shares of listed companies (equity investments). The proportion of equity held in each investment strategy depends on the product. Our with profits products provides additional guarantees and smoothing, more detail on these products and their investment strategy can be found in the Principles and Practices of Financial Management. We’re committed to being a responsible investor. This means that good stewardship is hugely important to us, as is choosing the right asset managers to make investment decisions on our behalf. You can find out more in our Responsible Investment policy and our Stewardship and Engagement policy.We work with our primary asset manager Royal London Asset Management (RLAM) to exercise our stewardship responsibilities. Read more about RLAM’s approach to Responsible Investment. *as at 31 Dec 2020 Glossary We recognise that not everyone uses the same language or terminology when talking about stewardship and responsible investment, so we’ve provided a glossary below to explain how we use these terms. We’ve adopted the most widely recognised industry standard definitions, based on the UK Investment Association’s responsible investment Framework, the Principles for Responsible Investment and the Global Sustainable Investment Alliance (GSIA). Engagement Carbon Neutrality COP 26 ESG integration Exclusions/ Ethical investing Impact investing Greenwashing Net zero Proxy voting Responsible investment Stewardship Sustainability Sustainable investment Purposeful dialogue between investors and companies on environmental, social and governance (ESG) issues with the intention to influence (or identify the need to influence) company behaviour or improve disclosure. Need advice? If you don't already have a financial adviser, there are a number of directories that you can use to search for one in your area and according to their specialisms. Advisers may charge for their services - though they should agree any fees with you upfront. Find a financial adviser about Need advice? Back to top Products and services Over 50 Life Insurance Life Insurance Mortgage Life Insurance Level Term Life Insurance Critical Illness Cover Equity Release Pensions Retirement Options About us About Royal London Corporate information Our businesses Partnerships Careers Media centre Press contacts Useful links Contact us Make a claim Find a financial adviser Coronavirus support Protect yourself from fraud The Royal London Mutual Insurance Society Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. The firm is on the Financial Services Register, registration number 117672. Registered in England and Wales number 99064. Registered office: 55 Gracechurch Street, London, EC3V 0RL. © Royal London 2021 Legal and privacy Cookie policy Modern Slavery Statement Accessibility Sitemap By clicking “Accept All Cookies”, you agree to the storing of cookies on your device to enhance site navigation, analyse site usage, and assist in our marketing efforts. Using cookie settings will give you the choice of what optional cookies we set and allow you to manage them. We won’t set them without your consent.cookie policy Accept All Cookies Cookies Settings