Almost half (46 per cent) of pension professionals believe that identifying and collecting the required data is the biggest challenge facing trustees dealing with the new climate regulations, Sackers has found.

The law firm polled webinar attendees representing trustees and employers of both defined contribution (DC) and defined benefit (DB) schemes about the climate-related governance and reporting rules that are currently being phased in.

Alongside the data challenge, more than a quarter (29 per cent) of the attendees stated that they were still unsure of what they needed to do.

Schemes in scope will need to establish and maintain clear governance frameworks and processes for identifying and managing scheme-related climate risks, and select and report on climate-related metrics, setting a non-binding target for at least one of them.

Sackers noted that although the learning curve would be “steep”, schemes in the £1bn to £5bn range could benefit from the work undertaken by the larger (£5bn+) schemes that are already implementing the regulations.

Sackers partner and Pensions Climate Risk Industry Group (PCRIG) chair, Stuart O’Brien, commented: “Trustees aren’t expected to be climate experts or scientists, but they are ultimately responsible and accountable for ensuring that they comply with the new regulations.

“They need to start asking the relevant questions of their advisers and investment managers now to ensure they’re well placed to comply with the regulations when their scheme comes into scope.

“There is also industry guidance to support trustees too, including a practical step-by-step guide from PCRIG that covers all aspects of the new regulations that will help trustees better navigate their way through this.”

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