Local Government Pension Scheme (LGPS) pool Border to Coast Pensions Partnership has confirmed it has reduced financed emissions for in-scope assets by 66 per cent since 2019, exceeding its 2025 target by 13 per cent and staying on track for its 2030 goal.

The reduction reflects improved carbon profiles in existing assets, portfolio restructuring, the launch of lower-carbon sub-funds, and reduced exposure to higher-emitting companies.

In 2024, Border to Coast engaged with firms responsible for over 78 per cent of its financed emissions, carrying out 1,919 engagements in 2024 on a range of long-term issues.

Around 41 per cent of these focused on business strategy and governance, 31 per cent on environmental concerns, and 20 per cent on social issues. The pool confirmed it remains on course to achieve net zero emissions by 2050.

The pool has also strengthened its responsible investment policies, voting against management at companies involved in high deforestation-risk commodities such as palm oil, beef, and paper, where policies to reduce environmental impact are lacking.

It noted opportunities in listed equity and fixed income investments to support companies that contribute to a lower-carbon economy, with approximately £6.8bn invested in these climate-focused solutions as of 31 March 2025, down from £8bn in 2024.

In April 2024, the pool secured an additional £1.2bn in commitments from partner funds to invest in its climate opportunities strategy - a private markets, multi-asset strategy that focuses on a variety of projects outside public stock markets.

This strategy aims to help the world move to a lower-carbon economy, for example, by funding waste-to-energy projects or EV charging points across the UK.

The pool also confirmed that it had disinvested from HarbourVest Global Private Equity in June over concerns about social and governance risks around its largest investment, Shein, a China-based fashion retailer.

Persistent allegations of labour exploitation and opaque supply chain management, particularly regarding cotton sourcing from Xinjiang, China, raised concerns.

The pool explained that Shein’s rapid growth and scale created challenges for oversight, leaving insufficient transparency on worker welfare, and efforts to clarify labour practices were unsatisfactory, raising concerns about investment and reputational risks.

Combined with the fund’s high fees, these issues led to the decision to disinvest in HarbourVest Global Private Equity, as it no longer aligned with Border to Coast’s investment objectives and risk tolerance.

Border to Coast has been part of the Net Zero Asset Managers initiative since 2021, committing to decarbonise investments by 2050 or sooner.

However, it stated that it will not disclose the quantitative results from its climate scenario analysis due to the limitations of the models.

These limitations include insufficient accounting for policy changes, technological advancements, and the extent to which companies adhere to their transition plans.

The pool said it sees scenario analysis as a guide, not a prediction, to help understand climate risks and opportunities, rather than a precise forecast.

Border to Coast stewardship manager, Colin Baines, said environmental, social and governance factors are not a “nice to have” for investors, but are “fundamental drivers of financial value”.

“We stand by our belief that active engagement with companies is the most effective way to influence real change,” Baines said.

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