Top firms ‘lack pension transparency’

GlaxoSmithKline, Tata and Rolls Royce have been warned to improve their corporate social responsibility.

The corporate giants scored just one point between them in a new study of the responsible investment performance of UK pension funds.

Jointly topping the league table, published today by charity ShareAction, was BT and BBC, which both scored 35 out of 40. The rankings are based on what action pension schemes take to address members’ concerns about the behaviour of the businesses they invest in.

Catherine Howarth, Share- Action’s chief, said: “The pension schemes we’ve ranked are among the UK’s most powerful investors, but only a few take that responsibility seriously. If big employers like GlaxoSmithKline and Barclays want to improve their CSR credentials, they need to make sure their pensions schemes invest in a way that is transparent and accountable.”

All but one of the occupational schemes surveyed had a specific responsible investment policy, but 10 of the 24 schemes provide no information to members on how they vote at company AGMs.

However the survey found improvement since 2009, with 11 pension funds publishing detailed reports of their engagement with investee companies, up from five.

Transparency to members and communication with them remains poor among the giant, older pension schemes surveyed, but the Master Trusts that have come into existence since pensions auto-enrolment started show more interest in communicating with their members. Two out of the four surveyed (NEST and the People’s Pension) publish the top ten holdings for each fund they provide.

“There’s absolutely no excuse for schemes keeping members in the dark,” said Ms Howarth.

“It’s encouraging to see some new pension providers using social media to connect with their members, not least to demystify pensions jargon but also so as to conduct regular member surveys.”