UK pension funds 'concerned' over asset manager climate vote record

A group of UK-based pension schemes and other asset owners is concerned about how the asset managers they employ to run their money are voting on climate-related issues at European oil and gas companies.

Faith Ward, chair of the UK Asset Owner Roundtable, said in a LinkedIn post it planned to meet with major fund managers after the current proxy voting season to go over the votes amid concern their long-term interests were not being served.

Among those to raise concerns were the Brunel Pension Partnership Limited, Scottish Widows and The Church of England Pension Board, she said.

"UK asset owners are concerned that despite unequivocal warnings from the United Nations and the IPCC of the risks of delayed action on climate change, that short-term interests are trumping long-term interests of pension funds," she wrote.

"Delayed action on climate increases the chances of a disorderly climate transition and missing the goals of the Paris Agreement. This in turn increases the risks to pension funds' long-term interests and the ability of those funds to serve the interests of their members/beneficiaries."

U.N. Secretary General Antonio Guterres warned in March that the latest Intergovernmental Panel on Climate Change report showed the "climate time bomb was ticking", urging quicker action ahead of the next round of climate talks in November in Dubai.

At British energy company BP's (BP.L) April 27 annual meeting, a shareholder resolution calling for it to set tougher climate targets won the support of 16.75% of votes cast.

Fellow British energy company Shell (SHEL.L) hosts its annual meeting on May 23 and French peer TotalEnergies (TTEF.PA) on May 26.

After the proxy season has finished, the group would commission a leading academic to review the way asset managers interpreted their clients' long-term interest, with a focus on key annual meetings.

"The meeting is intended to be a constructive dialogue to support UK Asset Owners and to ensure that our needs are effectively understood by the managers we select on behalf of our Members and the Beneficiaries we serve," Ward wrote.