Scottish Widows has invested an initial £2 billion of pension fund assets to become the inaugural investor for BlackRock’s Climate Transition World Equity Fund — which it helped design.

“Offering customers more sustainable investment choices, and challenging companies in which we invest to behave more sustainably and responsibly, is a central part of our strategy,” said Scottish Widows head of pension investments Maria Nazarova-Doyle.

“Our work with BlackRock to design this new fund, together with our significant investment, will help to engender positive change in the industry; incorporating ESG risks into a portfolio can have a meaningful impact on financial performance.”

BlackRock head of UK Sarah Melvin said: “The global shift to zero- and low-carbon energy sources is underway and is accelerating.

“The BlackRock Climate Transition World Equity Fund expands our range of sustainable investment solutions, adopting an innovative data-driven research approach to sustainability and climate change, and aims to deliver long-term value to clients based on companies’ readiness to transition to a low-carbon economy.

“This marks another milestone in BlackRock’s commitment to helping clients build sustainability into their portfolios.”