If you would like to download this report you can obtain a copy here (this will open in another window).  If you would like the report in a different format or would like a hard copy please contact us on
01202 738650.

TLWPT - The Lewis Workplace Pension Trust
TCFD Report

October 2022

   A message from the Trustee Chair

I am pleased to share our first TCFD report which aims to provide an insight for our Stakeholders on how the Trustees are incorporating the recommendations of the Climate-related Financial Disclosures task force in the day-to-day activities of the Trust.

We appreciate that as we do not make, mine or build anything our contribution to the global effort to combat climate change will be centred around working with our suppliers, our infrastructure and investment practices ensuring they align with the recommendations.

Only by working together can we play our part in tackling climate change while improving equality and diversity across all aspects of our business.

We believe setting high standards in conduct, accountability and transparency are the cornerstones of good governance.  As pension providers looking to the future is an essential part of the service we provide to our members.

If we can make a difference, no matter how small, in contributing to the future of our planet and the people reliant upon it, we believe it is our duty

Andy Cheseldine TLWPT Trustee Chair

Andy Cheseldine
TLWPT Trustee Chair

A person crossing a rope bridge above a forest floor

"I think we're lucky to be living
when we are, 
because things
are going to get worse."

- David Attenborough

   About us

The Lewis Workplace Pension Trust (TLWPT) was established under a Trust arrangement to provide auto enrolment services to facilitate participation, while reducing the compliance burden on employers.  TLWPT is an authorised Master Trust scheme and is regulated by The Pension Regulator; it is not regulated by the Financial Conduct Authority.

The Trust or Scheme is governed by a Trustee Board responsible for ensuring the Scheme is run in accordance with the Scheme rules and current legislation.

The Scheme Sponsor and Strategist is Lewis & Co (Investments and Pensions) Limited trading as Lewis Investment, incorporated under the laws of England and Wales with company registration number 02895270.  Its registered office is 41 Commercial Road, Poole, Dorset, BH14 0HU.  Lewis Investment are authorised and regulated by the Financial Conduct Authority. FCA No: 143646.

 

Alongside our commitment to deliver safe, high quality and cost-effective auto enrolment services, our Scheme endeavours to improve member outcomes and responsible investment.  During 2022 the scheme Trustees took the decision for all future contributions into the Default Portfolio to be invested in funds incorporating ESG (Environmental, Social and Governance) issues.

While the default strategy is appropriate for most members, the Trustees have long held the belief that members wishing to take a more proactive role in the investment of their pension benefits should be encouraged to do so.

To ensure members receive appropriately regulated financial advice the Trustees appointed Lewis Investment as Scheme adviser.  All members have access to this service and alternative investment options through a range of risk based portfolios (it should be noted a risk profiling process is necessary to use these options).

   Governance

In this report we cover the initial steps being taken to review how TLWPT have identified climate related risks and opportunities and the approach adopted to oversee the identified issues.

The Trustee Board

The Lewis Workplace Pension Trust is governed through a Trustee Board. The Board is ultimately responsible for the oversight of all strategic matters related to the scheme. This includes approval of the governance and management framework relating to environmental, social and governance (ESG) considerations and climate-related risks and opportunities.

The Trustee Board comprises three Trustees, Lee van Hoyland, Richard Sheppard and Andrew Cheseldine who serves as Trustee Chair on behalf of Capital Cranfield Limited, professional trustees.  The Scheme was founded and is sponsored by Lewis & Co (Investments & Pensions) Limited trading as Lewis Investment.

An organisational chart for TLWPT

The Scheme

TLWPT is a Master Trust authorised by The Pensions Regulator to provide auto-enrolment services to its participating employers and members.  As a master trust all members are automatically enrolled in the default portfolio which invests though pooled Unit Trusts and Open-Ended Investment company investment funds via the Legal & General Investment Management platform (LGIM).

The default option is split into separate sections to facilitate lifestyling* as members approach retirement.

(* Lifestyling is the automatic switch of pension savings in the default funds into lower risk funds which is carried out gradually over a number of years before retirement.)

Pie chart with percentage splits for Default 1 fund

 

Fund Name Weighting Fund AMC Weighted AMC
L&G UK 100 Index Trust 30% 0.10% 0.03%
L&G International Index Trust 15% 0.13% 0.0195%
L&G US Index Trust 10% 0.10% 0.01%
L&G European Index Trust 7.50% 0.12% 0.009%
L&G Japan Index Trust 7.50% 0.15% 0.01125%
L&G Future World ESG Developed Index 30% 0.20% 0.06%
Total 100%   0.14%

Correct as at 27th September 2022

The allocation for regular contributions into Default 1 from July 2022 are:

L&G FW UK Index 30.00%
L&G FW North American Index 7.50%
L&G FW Europe ex UK 7.50%
L&G FW Asia Pacific 10.00%
L&G FW ESG Developed 29.00%
L&G FW Climate Change Equity Factors Index 10.00%
L&G FW ESG Emerging Markets Index 6.00%
  100%

PLEASE NOTE: FW stands for future world.

Pie chart with percentage splits for Default 2 fund

 

Fund Name Weighting Fund AMC Weighted AMC
L&G UK 100 Index Trust 25% 0.10% 0.025%
L&G International Index Trust 10% 0.13% 0.013%
L&G US Index Trust 10% 0.10% 0.01%
L&G Future World ESG Developed Index 25% 0.20% 0.05%
L&G Cash Trust 30% 0.15% 0.045%
Total 100%   0.143%

Correct as at 27th September 2022

The allocation for regular contributions into Default 2 from July 2022 are:

L&G Future World UK Index 25.00%
L&G FW North American Index 5.00%
L&G FW Asia Pacific 5.00%
L&G Future World ESG Developed 25.00%
L&G FW Climate Change Equity Factors Index 10.00%
L&G Cash 30%
  100%

 

 

 

Pie chart with percentage splits for Default 3 fund

 

Fund Name Weighting Fund AMC Weighted AMC
L&G UK 100 Index Trust 15% 0.10% 0.015%
L&G International Index Trust 10% 0.13% 0.013%
L&G Future World ESG Developed Index 15% 0.20% 0.035%
L&G Cash Trust 60% 0.15% 0.09%
Total 100%   0.133%

Correct as at 27th September 2022

The allocation for regular contributions into Default 3 from July 2022 are:

L&G Future World UK Index 20.00%
L&G Future World ESG Developed 20.00%
L&G Cash 60.00%
  100%

 

 

Pie chart with percentage splits for Default 3 fund

Correct as at 27th September 2022

The allocation for regular contributions into Default 4 from July 2022 are:

L&G Future World UK Index 5.00%
L&G Cash 95.00%
  100%

The scheme also offers a range of risk-based portfolios for those members who wish to have a more active role in the investment of their pension funds and have taken financial advice via the Scheme’s appointed financial adviser, Lewis Investment.  Lewis Investment are authorised and regulated by the Financial Conduct Authority.

These risk-based portfolios are actively managed by Lewis Investment and include a wider range of funds grouped as Cautious, Moderate, Speculative, Responsible Investing and a Shariah portfolio.

The Scheme does not invest on its own behalf; all investments are held for the benefit of its members.

Training and knowledge

The Trustees level of knowledge and understanding on ESG and the TCFD framework continues to develop having initially attended ESG training presentations and conducted individual personal development study.  It is intended that each Trustee will undertake the relevant training available on the TCDF Knowledge Hub and in particular;

  • Introduction to climate-related disclosures – starting your climate journey;
  • Understanding the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD)
  • Climate-related financial disclosures – continuing the journey
  • Introduction to scenario analysis
  • Governance of climate-related risks and opportunities
  • An introduction to managing the financial risks from climate change

Developing an understand of the extent and reach of scale of the project will inevitably lead to additional training which will be arranged as and when identified.

New Trustees will undertake an induction programme incorporating training on both ESG and TCFD to ensure the appropriate degree of knowledge and understanding to support good decision-making.

Oversight

The Trustee Board take their responsibilities for the governance of climate-related risks and opportunities seriously and continue to evolve the implementation of their strategy.  While establishing an internal governance framework, various specialist firms have been appointed to assist in their duties.  The board plays an active role in overseeing risk management through regular interactions with internal and external auditors, legal opinion and compliance.

The Board meets quarterly, with their advisers, reviewing and discussing both regulatory and climate-related issues. The Trustees expect their advisers to bring important and relevant climate-related issues and developments to their attention in a timely manner and have the opportunity at these meetings to raise questions or request clarification.

The Trustees have carried out research and consulted with advisers and sponsors to develop an understanding of climate change and its implications for the Scheme. They have articulated climate-related beliefs and agreed an overarching approach to managing climate change risk. Details are set out in the Statement of Investment Principles (SIP) which is reviewed and (re)approved at least every three years (or sooner in the event of a significant change in investment policy).

The Trustee Board take their responsibilities as guardians of the Scheme Member’s assets seriously.  ESG criteria will guide their decision-making on investment decisions, especially when there is climate-related risk and they are committed to:

  1.   Incorporating ESG issues into investment analysis and decision making processes.
  2.   Incorporating ESG issues into ownership policies and practices.
  3.   Engaging with the fund managers in which the Scheme invests on climate-related risks and opportunities, encouraging them to support the TCFD recommendations and requesting the appropriate disclosures.

The Trustees have delegated certain aspects of the oversight and management of climate change issues in relation to fund selection to the Investment sub-Committee.  The committee comprises a representative from Lewis Capital Management Limited, Lewis Investment and Lee van Hoyland representing the Trustees.

The investment committee meets monthly to review fund performance, asset allocation and stewardship practices and proxy voting policies including those concerning material climate risks.

As previously mentioned, the Scheme’s advisers and sub-committees play an integral part in the delivery of their commitment to deliver sustainable development.

TLWPT Investment Committee is responsible for reviewing the stewardship activities of the funds comprising the default and model portfolio managed by external advisors and whether they constitute a climate risk or opportunity.

Lewis & Co (Investments & Pensions) Limited trading as Lewis Investment is responsible for providing financial advice to the Scheme members incorporating ESG options and providing feedback to the Trustees on the opinions expressed by the membership.

The scheme’s sponsor, also Lewis & Co (Investments & Pensions) Limited trading as Lewis Investment, is responsible for providing the office infrastructure and in-house administration team.  Their Sustainability Plan is available on their website and aims to lower their carbon footprint by 2025.

Lewis Capital Management Limited is appointed to provide investment advice on the asset allocation and underlying assets selected for use within the Scheme and is responsible for monitoring performance.

The Trustees are establishing targets for operational sustainability to help responsibly manage and reduce the Scheme’s own environmental footprint.

Aimed initially at the default portfolio which is operated via LGIM and containing LGIM ESG indexed funds.

Stakeholder Engagement

In order to respond to our climate change responsibilities it is essential that we engage with four key stakeholder groups which are likely to be impacted by our business.

  • Participating Employers – Feedback from our participating employers and members helps us to improve our services and support.
  • Members – Feedback from our members helps us to improve the information we provide to assist members in making informed choices about their retirement.
  • Society – We aim to collaborate not only with those business directly involved with us but also in other ways to identify alternative solutions to enforce positive change.
  • Employees – The views, ideas and worries of our employees are taken seriously as we want all associated with the Scheme to be engaged and dedicated.

We believe a joined up approach between the Trust and our key stakeholders via a TCFD sub-committee will significantly increase our ability to deliver the sustainable change.  As such the board has approved the establishment of a sub-committee Chaired by Lee van Hoyland, representing TLWPT, Lewis Investment and Lewis Capital Management.  The purpose is to work together ensuring our global goals and responsibilities are met providing updates to the Board on the progress made and any red flags.

What’s material

Understanding the views and expectations of our stakeholders plays a crucial role in the success of the Scheme and the acceptability of our operations. In order to identify what topics we should particularly focus on in our sustainability efforts, we are in the process of conducting a materiality assessment by engaging our key stakeholders.  We look forward to sharing the materiality assessment results on our website when the assessment is complete.

The most material topics for TLWPT identified are based on their relevance to our business, stakeholders, and the estimated impact on those using our services.  The current themes for consideration are:

Social (S), Environmental (E), Customer (Cu) and Community (Co).

Each breaking down into various sub-categories such as: 

Theme Material Topic Developments for 2022
E Climate change Implementing sustainable and effective measures to mitigate climate change.
S/Co Community engagement Develop ways to support the local community and engage with scheme members on how they would like us to do so.
Cu Customer engagement Listen and learn. Provide accessible information to aid better understanding of the pension lifecycle enabling informed decisions.
Cu Cyber risks Managing threats from cyberattacks or malware and wrongful exploitation scheme data.
Cu Data Privacy and Security Protecting customer and confidential information and ensuring information is accurate and secure.
S Demographic change Monitor the implications of demographic change, such as an ageing society and an increasing population.
S/Co Diversity, inclusion and equality Develop an environment where people are treated equally with respect regardless of gender, age, ability, religion, sexual orientation or cultural background.
S/Co Employee Health, Safety & Wellbeing Provide an inclusive, safe workplace and support employees with both physical and emotional wellbeing.
E Environmental and due diligence Applying the TLWPT framework to ensure that fund managers reduce their negative social and environmental impact.
S Ethics and compliance Acting with the highest level of integrity and compliance with all applicable laws, regulations and standards, with a zero-tolerance to bribery and corruption.
Cu Financial performance Continuing to be a financially healthy and stable Scheme.
Co Human rights Examining the standards of our supply chain and those impacted by it and identifying any human rights issues within our fund selection.
E Nature and Natural disasters Expecting the unexpected.  Prepare for events that may take months or even years to recovery from; implementing a disaster recovery and business continuity plan
Co Stakeholder engagement Identify stakeholders, their influence and potential and actual areas of conflict.
Co Supply Chain Management Collaborate with suppliers and identify any climate change risk or opportunities that may impact on the scheme.  Communication and encourage mitigating actions.

The assessment process is built around four steps: identification, evaluation, prioritisation and eventually integration of the most material sustainability topics.

Key points in response to the TCFD recommendations

Refer To Appendix 1 for a summary of the key points in response to the TCFD recommendations.

   Strategy

Our strategy supports the transition to net zero and The Lewis Workplace Pension Trust supports the aims of the 2015 Paris Agreement and the recommendations of the TCFD. We believe that in order to provide sustainable outcomes for all of our members throughout their retirement, we must invest in the transition to a low-carbon economy.

Climate change is an issue that spans decades and we recognise that different time horizons need to be addressed as to how and when it may pose a material risk to our business. As such, we consider three time horizons:

  • Short term (2022 - 2027)
  • Medium term (2027 - 2035)
  • Long term (2035 – 2050)

Furthermore, Climate risk can present itself through two channels; physical and transition risks:

Physical Risks      -    Risks that arise from changes in climate or weather patterns from events such as storms, heatwaves or fires, to longer term shifts such as affected water supplies, rising sea levels or an increase in precipitation.

Transition Risks   -    Risks arising from the shift towards a greener economy including economic, technology or market risk, policy and regulation changes, leading to legal risks from failure to adhere to changes.

We believe the transition risks will have a greater impact over the short to medium term as we adapt and change to meet net zero and physical risks to impact over the longer term. We are, within the next 12 months, undergoing a qualitative assessment of the climate-related transition and physical risks and opportunities within our business and the necessary actions required going forward.

Our plan strategy and metrics will evolve over time as we familiarise ourselves with greatest risks and opportunities.

For now, we endeavour to improve member outcomes and responsible investment, however in order to give us a better chance of achieving a temperature rise target of 1.5°C – 2°C, and to keep the climate change risk low for our members, we are aiming for a target date of 2050.

In September 2019 we began to reshape our approach to the types of investments within our default portfolio when we switched 10% into a fund with ESG (Economic, Social, Governance) issues.

The trustees have since agreed that from July 2022, all member contributions into the Scheme’s default portfolio will be invested 100% into funds with ESG considerations, thus increasing our exposure to investments that are aligned with a net zero pathway, with the intention of making our entire default portfolio holdings net zero by 2050.  The trustees are also intending to introduce ESG investment into the model portfolios.

This change set in July 2022, includes our goal to invest at least 10% into climate solutions. This may increase over time as the investment committee and trustees monitor the funds and allocations and as we continue to seek out alternative net zero investment opportunities.

As detailed within the Metrics section of this report our other focus is on reducing the operation carbon footprint of our business. Again, with a target of reaching NetZero by 2050.

   Risk Management

TLWPT define risk as an event that may have an impact on the achievement of the scheme’s objectives. The existing Risk Management Framework confirms that risk may arise from external factors (e.g. suppliers or global economic crisis) or internal sources (e.g. new projects, infrastructure, etc.) thus incorporating climate related risks and the impacts of the transition to net zero.

The Trustee’s risk appetite will vary from year to year depending on the scheme circumstances (e.g. capacity to take on risk, scheme objectives, evolving industry and market conditions, etc.) and, as such, climate related risks will be identified, assessed and managed in line with the existing risk management methodology.

Objectives of TCFD Risk Management

The objective of this document is to provide a formal process to assist in the integration of climate related risks into TLWPT’s existing Risk Management Framework. This includes considering:

  • Interconnections between climate-related risks and other risks
  • Temporal Orientation: analysing both physical and transitional risks across short, medium and long term for strategic planning
  • The proportionality and materiality of its exposure to climate related risks when compared with TLWPT’s other risks.
  • Consistency to support clarity

Risk Identification

In line with the overarching Framework, operational risks are identified and assessed by TLWPT Administration Team Leader, who will monitor regulatory updates, manage ongoing operational risk reviews and provide updates to TLWPT Risk Register.

As we do not view climate related risk as a stand-alone risk due to its complex and broad nature, it is to be integrated into the six existing categories of risk:

  1.   Administration
  2.   Financial
  3.   Investment
  4.   Governance
  5.   Legal & Regulatory Compliance
  6.   Communication

However, a seventh risk category, “Infrastructure”, will be added to the existing framework and the Scheme Resource Planner, which acts as a calendar of actions, will be updated to include the following for review:

  • Annual TCFD report, incorporating:

        o       Assessment of the climate risks facing the Scheme;

        o       A review of the Trustee's governance framework; and

        o       A qualitative assessment of the metrics and benchmarks used for the default funds to ascertain if they are still appropriate.

  • Investment strategy review (quarterly) including a review of the metrics and performance analysis
  • Annual Climate Related Risks and Opportunities ("CRROs") Training for all Trustees.

Furthermore, climate risk can present itself through two channels; physical and transition risks, which can affect all of the above categories.

Risk Assessment

Operational climate risk will be assessed by TLWPT Team Leader and the Head of Auto Enrolment, in line with TLWPT’s risk methodology to determine the likelihood, severity and financial impact if not managed effectively.

Both internal and external sources will be used to assess the impact of our services and business relationships, including questionnaires to key suppliers to ascertain their approach to sustainability, member feedback on social impacts and due diligence processes.

In order to address the different time horizons, climate risk will be stress tested over the short, medium and long term.

Once identified and assessed, the Head of Auto enrolment will report to the Trustee board both ad hoc and on a quarterly basis.  The Trustee Board will then consider the risks and opportunities with any enterprise wide climate risks.

Risk Management

Initially, climate risks will be identified through a Materiality Assessment, as noted in the Governance Section. This will determine the areas for further focus and risk management over the coming year.

Once these have been assessed in line with the above guidelines and existing Risk Management Framework, an inherent risk rating will be given, highlighting those risks which take greater priority. This will enable the Trustees to evaluate the strength of control in relation to the prescribed control criteria and establish the appropriate treatment.  The decision can then be taken as to whether the risk is avoided, mitigated, transferred or accepted and controlled.

Over the coming years as our approach and understanding of climate related risks develop so too will our approach to its management.  It is anticipated that as the Scheme grows additional risk may arise as we transition closer to net zero, in turn these risks will be evaluated as set out in the latest the risk framework.

   Metrics

As The Lewis Workplace Pension Trust does not make, mine or build anything, our focus must be on engaging with our investment managers, Legal and General (LGIM) and our key suppliers.

We aim to disclose the following on an annual basis within the TCFD report:

  • One absolute emissions based measure: tCO2e
  • One intensity emission based measure: Carbon Footprint

 

As we are very reliant on our key suppliers, in particular Lewis & Co (Investments and Pensions) Ltd, with regards to Scope 1 and 2 Greenhouse Gas (GHG) emissions, our intensity emission based measure (Carbon Footprint) will be heavily reflected in their success.

This is due to Lewis & Co (Investments & Pensions) Ltd providing the infrastructure for our business to operate. This includes an in-house administration team and therefore the daily commute, as well as electricity purchased, water disposal and paper used. Furthermore, as they the Scheme advisers, fuel and business travel also falls under their responsibility.

Detailed below are two key metrics that will be the focus for TLWPT over the next 12 months and the results will be disclosed in the annual TCFD Report. It is intended that our strategy and metrics will evolve in response to these results.

 

 

Metric Reduce our financed carbon emissions, (those associated with our investments)
Who is involved This will involve collaboration with Lewis Capital Management Ltd and Legal and General Investment Management (LGIM)
Target Achieve NetZero financed carbon emissions by 2050
How will this be achieved Measuring financed emissions is key to understanding our contribution to climate change, as well as understanding our exposure to climate-related risks.

TLWPT have engaged with Lewis Capital Management Ltd and LGIM to further information. This has resulted in the following action:

In September 2022, LCM instructed LGIM to provide a report/analysis based on the actual assets held under management and the absolute emissions of each fund within our portfolio.

LGIM regularly provide full disclosure of their ESG credentials, along with voting practices etc. These are available on request or can be found on the LGIM website.

LCM have also undertaken an analysis of the assets held within the Default portfolio and total assets held within the Model portfolios, using the PACTA assessment tool (The Paris Agreement Capital Transitions Assessment). As PACTA progresses, they will release further working tools, such as Stress Testing.

PACTA reports for TLWPT will be updated annually.

 

Metric Reduce our Operational carbon footprint
Who is involved This will involve collaboration with our key suppliers;

          Assure (UK) Limited

          Capital Cranfield Trustees Limited

          Lewis & Co (Investments & Pensions) Limited trading as Lewis Investment

          Lewis Capital Management Limited

          Options Corporate Pensions UK Limited

          Pinsent Masons LLP

          RSM UK Tax and Accounting Limited

          RSM UK UK Audit LLP

Target(s) NetZero by 2050

Key supplier for infrastructure (Lewis & Co (investments & Pensions) Ltd) to have reduced their office operating emissions by 50% by 2035

How will this be achieved Lewis & Co (Investments & Pensions) Ltd are key to reducing our operational carbon footprint and are key driving force in our reduction of scope 1 and 2 GHG emissions.

As such, TLWPT will be issuing all of our key suppliers with a sustainability/ESG focused questionnaire. This will request suppliers to provide TLWPT with base line metrics, enabling us to set clear and measurable targets going forward. This includes the following:

·        Electricity Usage

·        Water Efficiency

·        Waste & Recycling

·        Transportation

From this data we can ensure our key suppliers are observing and demonstrating the goals of the 2015 Paris Agreement and UK governments pathway to NetZero.

It is intended that, following review, the trustees of TLWPT will be in a position to encourage mid-term, reduced targets on our suppliers as we head towards 2050.

 

The next steps in our TCFD journey

Over the next 12 months we will:

  • We will continue to disclose our risk management process and key roles and responsibilities for oversight relating to climate-related risks and opportunities;
  • We will continue to consider climate-related issues when reviewing our supply chain, partners and issue ESG Due Diligence questionnaires to our existing suppliers and partners;
  • We will continue to learn from and implement best practices from other organisations and third parties with expertise in climate change;
  • We will continue to consider how the Board includes climate-related issues in decision making on strategy and performance objectives.
  • We will disclose our most material social and environmental risks in our annual report.

Appendix 1

Key Points in Response to TCFD Recommendations 

Pillar / Recommendation Key Points
Governance: Disclose the organization’s governance around climate-related risks and opportunities
 

 

a)          Describe the board’s oversight of climate-related risks and opportunities

Oversight of near-and long-term business strategy (including sustainability) by TLWPT Board of Trustees (the “Board”)
Board approving Investment and TCFD Sub-Committees while overseeing investment stewardship, public policy, corporate sustainability, and social impact.
The Board overseeing, identifying and reviewing fiduciary and other risks, including those related to climate and other sustainability risks, that could have a material impact on the firm’s performance
 

b)       Describe management’s role in assessing and managing climate related risks and opportunities

The Board sets the strategic vision and priorities of the Scheme and drives accountability, including related to the Scheme’s sustainability strategy
The Investment Sub-Committee oversees the firm’s investment processes, including ESG integration
Strategy: Disclose the actual and potential impacts of climate-related risks and opportunities on the organization’s businesses, strategy, and financial planning where such information is material
 

a)       Describe the climate-related risks and opportunities the organization has identified over the short, medium, and long term

Opportunities: increased demand for sustainable investment products.
Risks: market, regulatory, and reputational risks, as well as physical risks
 

b)       Describe the impact of climate-related risks and opportunities on the organization’s businesses, strategy, and financial planning

 

Management of climate-related risks and opportunities is embedded across investment processes, business strategy, and operations.

c)       Describe the resilience of the organization’s strategy, taking into consideration different climate-related scenarios, including a 2°C or lower scenario The requirements on governance, strategy (excluding scenario analysis) and risk management are ongoing.
 

Supplemental) Describe how risks and opportunities are factored into relevant investment strategies *

TLWPT incorporates climate-related risks and opportunities into investment processes through ESG integration and investment stewardship. The Investment Sub-Committee is responsible for identifying material climate- and other sustainability-related risks and opportunities in the funds with the default portfolio.

 

 

 

Pillar / Recommendation Key Points
Risk Management: Disclose how the organization identifies, assesses, and manages climate-related risks
a)       Describe the organization’s processes for identifying and assessing climate-related risk

 

Due to the complex and broad nature of climate related risk, TWLPT will not treat as stand-alone risk, but will integrate into the six existing categories as per Risk Management Framework. Then, will be assessed in line with existing risk methodology to determine the likelihood, severity and financial impact.

 

Inherent risk ratings used to prioritise each risk and establish necessary treatment: avoid, mitigate, transfer accept and control.

 

TLWPT’s existing framework already incorporates climate related risks. Now to be reported to the Board both ad hoc and on a quarterly basis.  Board will consider risks and opportunities along with any enterprise wide climate risks.

b)       Describe the organization’s processes for managing climate-related risks
c)       Describe how processes for identifying, assessing, and managing climate-related risks are integrated into the organization’s overall risk management
Describe how the positioning of the total portfolio with respect to the transition as a low-carbon energy supply, production and use is considered.* All new contributions to the Default portfolio have been invested into 100% equities with ESG considerations since July 2022. Existing funds under management will be monitored and assessed regularly and transferred into these equities with ESG considerations gradually as we transition to NetZero (2050).
Metrics & Targets: Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where such information is material
a)       Disclose the metrics used by the organization to assess climate related risks and opportunities in line with its strategy and risk management process Risks: One absolute emissions based measure: tCO2e

One intensity emission based measure: carbon footprint

Describe metrics used to assess climate-related risks and opportunities in each product or investment strategy* The Investment Sub-Committee have requested data from investment manager on underlying equities within default portfolio. Absolute emissions and carbon footprint will be used to measure success once a baseline has been calculated and provided.
b)       Disclose Scope 1, Scope 2, and, if appropriate, Scope 3 greenhouse gas (GHG) emissions, and the related risks Heavily reliant on key suppliers with regard to Scope 1 and 2 emissions as TLWPT do not make, mine or build anything.
Describe metrics used to assess climate-related risks and opportunities in each fund or investment strategy. Where relevant, asset owners should also describe how these metrics have changed over time* Data from Investment Managers (LGIM) will be used as a baseline to set metrics that will be used for first 12 months and reported in TLWPT’s annual TCFD report. Intended metrics will be based on actual assets held under management and the absolute emissions of each fund within our portfolio.   As this is first TCFD report there are no changes at present.

 

 

Disclose GHG emissions for assets they own and the weighted average carbon intensity (WACI) for each fund or investment strategy, where data and methodologies allow*

TLWPT do not own any assets. All scope 1 and 2 emissions will be under the control of key suppliers. TLWPT aim to manage these external factors by influencing our key suppliers, setting standards we expect our key suppliers to meet and aiding them in their own transition to NetZero.
c)       Describe the targets used by the organization to manage climate-related risks and opportunities and performance against targets Overall target is to achieve NetZero by 2050 with assistance from the investment sub-committee, Legal & General Investment Management (LGIM), Lewis & Co (Investments & Pensions) Ltd and other key suppliers.

*Reflects recommendations that are included in the Supplemental Guidance for Asset Owners, which incorporates updates to the guidance for the financial sector released by the TCFD in 2021

(https://assets.bbhub.io/company/sites/60/2021/07/2021-TCFD-Implementing_Guidance.pdf)

Scroll to top
Skip to content