PensionBee calls for £100m customer commitment to launch fossil fuel free pension

By Oliver Smith on Friday 13 November 2020

Savings and Investment

So far the pensions provider has £24m pledged.

PensionBee calls for £100m customer commitment to launch fossil fuel free pension
Image source: PensionBee.

Online pensions provider PensionBee is gearing up to launch its fossil fuel free investment plan, for savers who want to exclude coal, oil, gas, tobacco, arms companies and more from their investments.

The plan, which is believed to be provided by Legal & General Investment Management, is unique from PensionBee’s other sustainable and ESG plans, as it entirely strips out companies like Shell that are committed to improving their environmental impact.

“The Fossil Fuel Free plan is one of the UK’s first mainstream private pensions to completely exclude companies with proven or probable reserves in oil, gas or coal, tobacco companies, manufacturers of controversial weapons, nuclear weapons and persistent violators of the UN Global Compact,” writes PensionBee.

However, in order to launch the plan PensionBee is asking existing and new customers to commit a collective £100m from their pension pots in order to offer the plan at a low annual fee of 0.75 per cent.

So far, according to a PensionBee spokesperson, the fund has over £24m worth of commitments.

“To meet the fund requirements for launch we need a collective commitment of £100m from existing PensionBee customers. £100m is the fund ‘seed’ amount; the minimum amount needed to launch a new product like this.”

Once the goal is reached, PensionBee says the plan will become available.

Fossil Fuel Free won’t be for everyone however, the provider points out that the plan has a 100 per cent allocation to equities, which puts it among the highest risk portfolios that PensionBee offers.

However, pensions are long-term investments and, as PensionBee points out, if you believe we’re transitioning to a green economy, then having a pension invested in coal, oil or gas might be an even greater risk.

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