The UK roadmap was developed through extensive industry consultation and sets out recommendations in five categories: the investment regulations, stewardship and engagement, investment consultants, corporate reporting and scheme governance.

The Investment Regulations

  • The Department for Work and Pensions should revisit the Investment Regulations to clarify that the consideration of ESG factors is a core part of prudent investment decision-making.

Stewardship and engagement

  • Regulation and guidance should provide for a Stewardship Duty to clarify that shareholder rights are assets to be used in the best interests of beneficiaries
  • The Financial Reporting Council should extend the Stewardship Code to explicitly incorporate ESG factors and continue to monitor and publicly disclose the quality of reporting by signatories against the Code.

 Investment consultants

  • The FCA should expand its oversight of investment advice to include that provided by investment consultants in relation to ESG factors.
  • The Pensions Regulator (TPR) should provide guidance on the interaction of trustees with investment consultants to help trustees review advice and performance.

Corporate reporting

  • Through the implementation of the Non-Financial Reporting Directive, the development of standardised and comparable approaches for reporting on material ESG factors relevant to investors.

Scheme Governance

  • The governance arrangements for defined-contribution (DC) schemes should be strengthened and provide for enhanced consideration of ESG factors.
  • Schemes should be required to reflect on the impact of their scale on governance quality and, where necessary, consider consolidation.

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    Fiduciary duty in the 21st century: UK roadmap

    October 2016

Produced in collaboration with UNEP FI and Generation Foundation

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