By Imogen Shelley

Last month, the Taskforce for Social Factors (TSF) hosted a launch event for the release of the final guide for considering social factors in Pension Scheme investments and Imogen Shelley of the Burges Salmon Pensions Team was very pleased to attend. 

TSF is an industry group dedicated to, and passionate about, advancing the 'S' in ESG (Environmental, Social, and Governance) within the Pensions industry. In addition to the opportunity to network with other like-minded professionals within the ESG Pensions space over a bacon sandwich, pastries and tea and coffee, there was an interesting and informative panel discussion followed by some Q&A.  



The distinguished panelists, who are key members of the TSF committee, passionately addressed the multifaceted nature of the industry's social responsibilities. The panelists delved into critical aspects relating to trustees’ fiduciary duties and social issues such as egregious health & safety and pay practices and modern slavery. They also highlighted the materiality assessment framework contained in the guide designed to practically support trustees in considering social issues within pension scheme investments and decision making. 

Based on the insights from the panelists, here are some key action points for trustees to implement:

  1. Upskill Yourselves: Take responsibility to upskill on social issues within pension schemes using the guide provided by the Taskforce. 
  2. Question Effectively: Use the guide's framework and questions provided (on page 14) when engaging with investment consultants and asset managers.
  3. Define a Good Answer: Consider what constitutes a robust response to your questions using the information in the guide.
  4. Lead by Example: Reflect on how social factors impact your own business operations and set a good example, for example by paying fair wages, promoting diversity and inclusion, and vetting supply chains for issues like modern slavery.
  5. Assess Investment Risks: Utilise the guide's comprehensive materiality assessment (on page 12) to evaluate your investment portfolio’s exposure to social risks.

The Minister of Pensions, Paul Maynard MP, was also in attendance emphasising the importance of these initiatives. Minister Maynard shed light on the next steps, highlighting the need to evaluate the guide's impact and gather feedback on its effectiveness. In recognition of the ever-evolving landscape, he underscored the continuous development of guidance to align with emerging challenges and opportunities. Further publications of useful resources by the TSF will also be forthcoming, including a Quick Start Guide, Recommendations and Case studies of examples in practice.

For professionals engaged in pensions and ESG, this event and the comprehensive guide published felt like a pivotal moment in the industry's trajectory with an invigorated focus on social factors. Beyond compliance, the TSF guidance showcases a dedication to weaving social consciousness into the fabric of trustee decision-making. 

If you would like to know more about ESG in Pensions and your responsibilities as a Trustee or Participating Employer of a Pension Scheme, please contact Kate Granville Smith in our pensions team.