Parliamentarians have urged local government pension funds to play an active role in achieving a ‘just transition’ to a green economy.
The All Party Parliamentary Group for Local Authority Pension Funds made 23 recommendations after its inquiry into responsible investment for a just transition.
Although some recommendations call on the Government to act, a whole series emphasise the need for funds to engage with firms and other stakeholders.
The report said that, where firms fail to respond adequately, funds should be ready to escalate their concerns by filing shareholder resolutions, voting at annual meetings and pushing for employee directors.
It read: ‘The inquiry concluded that not fully considering a just transition poses a material risk to investors.’
Cllr Doug McMurdo, chair of the Local Authority Pension Fund Forum, said: 'We risk not having a transition to net zero if it is not just. As responsible long-term investors we have to ensure our work to achieve net zero actively support a just transition, in every way. However, we cannot do it alone. The scale of challenge and potential opportunities will require sustained commitment across society and from government.'