We want to help establish social pension funds that enable the general public to make social investments through their pension choices.
Many members of the general public would be interested in investing for a social as well as a financial return, particularly millennials. However, there are currently relatively few options for them to make social investments themselves. With the introduction of auto-enrolment, many more people will have defined contribution pensions and there is a big opportunity to enable the general public to use their pensions to make social investments.
Big Society Capital is committed to helping establish an industry of social pension funds that provide the public with a reliable retirement income and enables them to invest in causes they believe in.
What is a social pension fund?
A social pension fund is a fund in which an individual can choose to invest part of their pension entitlements, which includes some social investment as part of their broader investment portfolio. It is likely to be invested in through an individual’s defined contribution scheme.
The structure of the fund may follow the French solidarity investment funds model which includes around 90% of investments into listed socially-responsible investments and up to 10% in genuine social investments, such as affordable housing funds, community energy projects and innovative social enterprises tackling poverty and long-term unemployment.
It may be accessible to a wide range of potential individual investors, including self-investors, self-enrolled and the auto-enrolled.
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Big Society Capital is keen to help establish the first social pension funds in the UK. We are now working actively with stakeholders to develop these new social pension funds and help individual investors access them, and would be particularly interested in speaking to:
- Providers of pensions, such as large corporate employers, local authorities, large charities and auto-enrolment scheme platforms interested in innovating the pension offer
- Investment fund managers interested in developing new products
- Pension and employee benefit consultants interested in advising on new ways to engage employees
We are now partnering with Pensions for Purpose - a collaborative initiative of impact managers, pension funds, social enterprises and others involved or interested in impact investment.
Our Chief Investment's Officer's recent blog for Legal and General: Could a Social Pension Product Help Engage DC Savers?