id
At Standard Life, responsible investing is first and foremost about helping members to achieve their retirement goals. Our priority is always to aim to give members a good financial outcome in the long term.
Read on to find out the responsible investment approach for our Sustainable Multi Asset strategic lifestyle profiles and funds.
Building our approach
Our Sustainable Multi Asset strategic lifestyle profiles and funds use a series of underlying building-blocks for different asset classes.
Our building-block funds for equity and corporate bonds are collective investments, owned and operated by Phoenix Unit Trust Managers (PUTM). PUTM has overall ownership and control, but an appointed investment manager handles the day-to-day investment management. It’s a structure that gives us flexibility, particularly because we aren't tied to any single investment manager or strategy.
The responsible investment approach in our Sustainable Multi Asset solutions is embedded in our equity and corporate bond building-block funds.
Sustainability label for underlying equity and corporate bonds
We have incorporated the FCA's Sustainability Disclosure Requirements (SDR) labelling regime into our default investment option - through our building-block funds.
These equity and corporate bond funds aim to meet requirements for the Sustainability Improvers™ label.
Criteria for Sustainability Improvers™: supporting our overall objective to provide good financial outcomes
- Aim to invest in assets that have the potential to improve environmental or social sustainability over time
- At least 70% Sustainability Improvers™ investment content
- Evidence-based approach
- Specific, measured targets for improvement
- Strong and intentional stewardship
- Publish annual customer-facing sustainability disclosure
Responsible investment content for Sustainable Multi Asset Universal SLP:
The approach is focused on growing your members’ wealth, prioritising investment returns while aiming to avoid ESG risk.
Because our responsible investment approach is applied to equity and corporate bonds, the total amount of responsible investment in each fund will vary from 70% - 88% depending on its underlying investments. You can find the total for each fund in the relevant factsheet.
Responsible investment in Sustainable Multi Asset Universal SLP
Aiming to be net zero by 2050
To help manage some of the financial risks that come with climate change, our Sustainable Multi Asset solutions invest in funds that have a specific, measurable target for improvement.
Equity and corporate bond funds aim to reduce carbon footprint*:
On average by 7% each year
By 50% by 2030**
To net zero by 2050
id
*as measured through carbon emission intensity on a tCO2e/$m inflation-adjusted enterprise value including cash (EViC) basis. Includes scope 1 and 2 emissions. Does not include scope 3.
** compared to a 2019 baseline.
As part of Phoenix Group, we’re on a journey to becoming net zero by 2050. Find out how we’ll continue to support a better financial future for our customers, while considering our investment in carbon-emitting sectors, in our Net Zero Transition Plan. Standard Life is part of Phoenix Group and the data shown is for the combined Phoenix Group.
Enabling the journey to net zero
Our responsible investment approach for these equity and corporate bond funds is delivered through investments that track bespoke sustainable indices, owned by Phoenix.
Benefits of our index approach
- In each fund, Phoenix Group owns the index, and we benefit from in-house expertise and experience of index oversight in the Phoenix asset management team.
- We can review and adjust the index annually to stay on track to meet our aims.
- Ownership of the index gives us control over both the carbon footprint and risk profile of funds as we journey towards net zero – helping to protect member outcomes in the long-term.
In our bespoke indices, we do three things to help us achieve our net zero goal:
|
Exclusion
|
Tilts |
Stewardship
|
Measuring our progress
- Our exclusion, tilts and stewardship activities combine to reduce the carbon footprint of the fund.
- We measure our performance every year to check that we’re achieving our aims.
- We publish responsible investment measures in our fund factsheets, so that you can see how we’re doing.
Helping to drive the change
Our aim is to reach net zero by 2050. That means that we will invest in companies that may not be at net zero now, but that plan to improve their carbon footprint over time. This makes our stewardship approach an important part of the journey.
We have a dedicated in-house stewardship team, and our external investment managers also carry out stewardship for us. Our stewardship strategy for these funds is specifically designed to support our net zero aim, and we focus on the companies with the biggest carbon footprint.
Our strategy includes a plan for when engaging with companies isn’t working. As a last resort, we can stop investing in companies that do not respond to engagement.
How we use terms
We know that responsible investment terms can be used differently by different providers. To be clear on what we mean at Standard Life, we provide the following definitions:
- Responsible investing - a strategy and practice to incorporate environmental, social and governance (ESG) factors in investment decisions and stewardship
- Sustainable investing - investing with the stated intention of achieving positive sustainability outcomes alongside financial returns
