Standard Life moves £15bn to sustainable default

Standard Life, part of Phoenix Group, announced it will move £15 billion of assets and 1.5 million pension customers to a “sustainable default strategy.”

Standard Life said it will make a series of changes to its largest default pension fund propositions, Active Plus and Passive Plus, to provide a “mainly passive, lower-cost sustainable solution focused on growth and outcomes.”

The firm said the move reflects its sustainable multi asset strategies “which aim to simultaneously help employers and trustees meet their member and regulatory needs, and pension customers achieve good outcomes, with robust, growth-focused sustainable solutions, at the right price.”

Standard Life said: “With its Sustainable Multi Asset solutions, Standard Life is aiming to enhance returns over the long term by taking appropriate levels of risks earlier and optimising glidepaths to manage that risk.

“The new strategies will provide increased exposure to equities to target good customer outcomes and will be underpinned by ESG components of up to 80% plus within the asset class, depending on the strategy applied.

“This approach will aim for pension fund growth by seeking out responsible investment opportunities combined with better stewardship while simultaneously screening operations that may counter growth prospects.

“The first step to introducing the new solution was the launch of the Sustainable Multi Asset Universal Strategic Lifestyle Profile for ‘new clients’ at the end of 2020.

“Standard Life signalled at that time its intention to extend the strategies to ‘existing clients’ as part of an ongoing commitment to embed responsible investment solutions into default portfolios, and to meet the evolving expectations of customers.”

Gareth Trainor, Head of Investment Solutions, Standard Life said: “The enhancements we are making will look to achieve growth earlier in the investment process, with the balance of a suitable glidepath for pension scheme members to help them aim for the best possible outcome when they come to retire.

“Our investment thinking and philosophy is continually evolving to reflect prevailing market and societal factors.

“We are focused on taking a financial approach to sustainable investing, which means taking the right amount of investment risk at the right times for all our pension scheme members.

“We are delighted that we’re set to embed our enhanced growth, sustainable focused solutions for our pension scheme members in 2022, beginning in February for Master Trust members.”