The proportion of defined benefit (DB) trustees planning to take training on responsible investment (RI) issues fell to 20 per cent in 2023, down from a high of 31 per cent in 2021, research from Hymans Robertson has revealed.

Hymans Robertson warned that the falling focus on RI training could affect trustees' ability to make informed decisions about investment strategies, potentially leaving schemes significantly exposed to systemic risks like climate change, and other risks like greenwashing.

In addition to this, the research found that, when it comes to climate change and actively seeking to understand how climate risks impact their long-term objectives, just under a third (30 per cent) of respondents said that they plan to commission analysis on the matter.

The survey also looked at how DB trustees are planning for RI oversight as part of their governance programme, revealing that less than half of respondents (45 per cent) have planned to commission a RI investment review in 2022.

Hymans Robertson pointed out that while this is an increase from just over a fifth (21 per cent) in 2021, it is still a "significant reduction" from the all-time high of nearly two thirds (57 per cent) recorded in 2020.

Indeed, Hymans Robertson senior responsible investment consultant and net-zero lead, Mhairi Gooch, argued that the number of trustees who intend to review their investments from an RI perspective, particularly looking at climate change risks, is "worryingly low".

She continued: "When coupled with the fall in trustees planning to receive training on the matter or, including RI considerations in their upcoming governance plans the conclusion is, at best, that trustees feel their current RI approach and investments are sustainable and aligning with the transition to a low carbon economy.

“At worst, it points to overconfidence or, a misunderstanding of the constantly changing nature of climate change.

“Whichever is the case low uptake of RI training could result in unknown exposure to major systemic risks: climate change and biodiversity loss being two of the most relevant today and other emerging risks like greenwashing.

“As the risks and opportunities around climate change evolve, trustees will need to rely on their own understanding to make decisions, meaning a regular review of the RI status of their strategies is a must, as is regularly assessing how their policies and mandates are being met by their investment managers.

“This is one way for trustees to stay abreast of how their funds are likely to perform in a rapidly shifting investment landscape.”

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