UK: Govt. to consider legal reforms encouraging pension funds to invest in business with positive social impact, incl. green energy & social housing

Author: Lee Mannion, Thomson Reuters Foundation, Published on: 2 January 2018

"Pension funds set to transform British businesses doing good", 21 Dec 2017

Britain is mulling legal reform to encourage pension funds to invest more of their billions in businesses with a positive social impact, such as green energy and social housing...

"Pension schemes represent one of the biggest pools of opportunity to grow social impact investment," the ministers for pensions and civil society said...

In 2016, the government asked the Law Commission, which reviews and suggests legal reforms, to consider how far pension funds should consider social impacts when investing. The Law Commission proposed in June that laws be amended so that pension funds have to include information on the social impact of investments...

The government welcomed the recommendations... "The expertise that lies outside government - in charities, social enterprises, SMEs, pension schemes and big business - is integral to delivering solutions for social challenges in the UK," its report said.

The commission also recommended that the Financial Conduct Authority, the UK's financial watchdog, issue guidance on how pension providers can consider non-financial factors, such as social impact, when investing.

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