The UK’s Pension Schemes Act 2021 recently received Royal Assent on February 11, 2021. The Act addresses a range of initiatives intended to strengthen protections for pension scheme members, including a framework for new climate risk-related governance and reporting requirements for trustees of larger pension schemes.

The government is currently consulting on the details of these new climate risk requirements. Among other things, the proposals refer to the TCFD and would require trustees to integrate climate factors into investment processes, conduct scenario analysis and make related disclosures. Trustees would also be required to have adequate climate-related knowledge.

Continue reading on for more summary and analysis of the proposals in the consultation.