On the go: Almost half of respondents to a poll carried out by Eversheds Sutherland expressed a fear that trustees will not have time to comply with new climate change reporting requirements before they are introduced.
Pensions Expert has reported previously on the trouble pension schemes are likely to have gathering data on climate risk exposure, which will have to be reported as early as 2022 for schemes with more than £5bn in assets. It is thought that governance and reporting arrangements for these schemes will have to be in place from October 2021.
Of the 400 respondents to the Eversheds poll, 45 per cent welcomed the new reporting requirements without qualification, but 43 per cent, though broadly in favour of the move, feared the legislation left them too little time to comply.
Francois Barker, head of pensions at Eversheds Sutherland, noted that “there was clearly overwhelming support for this initiative among delegates, but significant concern at the compliance timescales”.
“For larger schemes and master trusts, these timescales could mean getting their [Task Force on Climate-related Financial Disclosures] reporting lines and governance structures in place within a matter of weeks — this will be very challenging,” he said.
The survey also polled respondents on issues ranging from jail sentences for crimes against defined benefit schemes, automatic enrolment contribution levels, and the Pensions Regulator’s new DB funding code.
Respondents were split almost evenly on the suggestion of seven-year jail terms for crimes against DB schemes. Fifty per cent thought the measure was too punitive, while 46 per cent deemed it acceptable.
On auto-enrolment contribution levels, a clear majority favoured an increase, either to 10 per cent or 12 per cent of earnings, supported by 47 and 39 per cent of respondents respectively.
Finally, the survey found 84 per cent in favour of the regulator’s new DB funding code, under which schemes may choose between a fast-track and a bespoke approach to funding.
Though the precise balance between the two routes has long been the subject of concern, a majority of respondents (71 per cent) said their schemes would opt for the bespoke approach.
Sarah Swift, pensions partner at Eversheds Sutherland, noted that respondents “were clearly comfortable with the notion of jail time for causing damage to DB schemes”.
“But when causing death by careless driving can land you only five years behind bars, there are clearly doubts about whether seven years is too tough a penalty,” she said.
On the response to the new funding code, Ms Swift noted that the response to the Eversheds Sutherland poll contradicted previous findings by TPR.
“The proportion of schemes represented at our conference who are likely to opt for a bespoke approach under the new proposed funding regime is in marked contrast to the regulator’s own research, which suggests a majority of schemes will be going down the fast-track route,” she added.
