Useful ethical pension tools

• What different options are available to you when it comes to 'green' pensions
   
• How to decide which fund or provider is best for you

• Do an online search, e.g. for ethical pension funds.
   
• Explore Make My Money Matter, a people-powered campaign focused on sustainable pensions.
   
• You can subscribe to EthicalConsumer for full access to their Ethical Pensions Score Card. It rates the major pension providers on their values, transparency, carbon reporting, campaigns, & more.

Keep reading for an exclusive checklist to help you in the process.

We've been busy reviewing some options for you.

📍note: the following examples are case studies to help you understand what is available to you. They are not SmartPurse recommendations, and before making any financial decisions, you should always talk to a qualified financial advisor first. 

It's community-led

PensionBee already had their Future World Fund, which only invests in companies making efforts to push forward a more environmentally-friendly economy. This loose definition led to the likes of the oil company, Shell, being a viable investment option, thanks to their net-zero carbon emission pledges. Naturally, customers complained about this greenwashing investment, creating the Fossil Fuel Free fund.

It's transparent

PensionBee does not hide its investments. You can see their top 10 holdings from the last quarter on the FAQ section of the Fossil Fuel Free fund page. 

It's relatively cost-efficient

Typically, customers would have to seek out a specialist ESG fund and hire a very active asset manager to receive the transparency PensionBee provides. By taking a passive approach, the annual fee for the Fossil Fuel Free fund is 0.75%, which is cheaper than the World Future fund (0.95%), though not their cheapest, which is the Tracker fund at 0.50%.

It's high-risk

It invests in 100% equities, which are a very high-risk form of investment (and would typically only be a percentage of your portfolio through diversification). Equities do not offer guarantees, meaning that your money is subject to the success (or failure) of the businesses it is invested in.

Funds managed by reputable brands - both the World Future and the Fossil Fuel Free funds are part of PensionBee's partnership with Legal & General.

It's incredibly transparent

Within their NEST Ethical Fund brochure, you can gain an in-depth understanding of how the fund operates. NEST details what it considers ethical (and why) and which specific ethical concerns the fund will prioritise. 

Similarly to PensionBee, NEST also provides quarterly investment reports covering their Ethical Fund. These explore the top 10 equity holders, asset allocation, and more.

It's pretty cost-efficient

NEST's Ethical Fund costs the same as NESTs other funds, with a 0.3% annual management charge, and promises the same award-winning approach, led by their in-house investment team.

It's personalised

One of the most exciting features of the Ethical Fund is its three-phase approach to risk, the 'Ethical Foundation', 'Ethical Growth', and 'Ethical Consolidation'. They spread out across a member's lifetime (or years until retirement). Slotting a higher-risk investment strategy ('Growth') between two lower-risk ones should ideally provide the best return on a pension.

All of our opinions on these funds are independent, we have not been paid to review them. They are not the only options available, doing your research or speaking with a financial advisor will ensure you find the right product for you.

Feel free to email us with any green pension funds you'd like reviewed, and we'll do our best to keep updating our list! Our reviews are always impartial, but do not act as SmartPurse recommendations. Talk to a qualified financial advisor before making any major financial decisions.

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