IGG announces partnership with Pensions for Purpose

IGG is pleased to announce its new role as a Community Partner with Pensions for Purpose.

The partnership furthers IGG’s ongoing commitment to address the challenges the pensions industry faces through systemic risks such as climate change, biodiversity loss and income inequality. This association and the wider Pensions for Purpose Community has been set up to accelerate the sharing of knowledge and investment in assets that benefit people and the planet. This is the first linking of Pensions for Purpose with a professional trustee firm.

Charlotte O’Leary, CEO of Pensions for Purpose, said: “We are delighted IGG is joining us as a Community Partner. With their tremendous reach as professional trustee to a large number of UK pension schemes, IGG is influential in helping schemes navigate the challenges of climate change, biodiversity loss and the inadequacy of defined contribution (DC) pension provision.”

Tegs Harding, Head of Sustainability and Trustee Director said: “Ensuring pension funds are managed with a sharp focus on sustainability is a key value and focus area for us. This closely aligns with Pensions for Purpose’s core mission of empowering industry stakeholders to value people and planet alongside profit. Through our partnership, we will be able to support and promote the purpose-driven work undertaken by this organisation, providing trustees and stakeholders with the tools and knowledge they need to make informed, decisions that positively impact both beneficiaries and the broader community. We look forward to taking on the role of an active partner, helping to transform the pensions and investment landscape for the better.”

This partnership builds on work carried out earlier this year between Pensions for Purpose and IGG where both parties joined forces to collaborate on the inadequacy of pension savings for people who retire without owning a home.

The initiative focused on the impending crisis facing the first generations to retire with only their DC pension pots. According to Pensions Policy Institute research, 20% of these retirees will find themselves in private rented housing, potentially requiring between £179,000 and £315,000 more in their pension pots just to cover the cost of rent. For many, particularly those who are not among the highest earners, this financial target is unattainable under the current system.

Pensions for Purpose and IGG have a number of broader concerns, including the increasing number of people with mortgage terms extending beyond retirement age, necessitating continued payments from their pensions. Furthermore, the inadequacies of the benefits system means those needing to claim housing benefit or disability support at retirement will not fully recoup the savings made through their pensions.

These issues influence how pension schemes should communicate with their members and also affect the targets set within retirement models and the design of default investment strategies. While reforms like higher contributions through auto-enrolment will benefit future pension savers, the challenges faced by those over 45 today require urgent and comprehensive policy changes.

As a Community Partner of Pensions for Purpose, IGG is committed to advocating for a long-term pensions commission to examine the intersection of pensions, benefits and housing. This commission would be important in ensuring the industry does not continue to overlook these pressing matters.

In the meantime, IGG believes it is essential to start engaging with people about their future housing plans in retirement, helping them to make informed decisions that will impact their financial security.

Richard Giles, Senior Director & Community Lead at Pensions for Purpose, said: “There are no easy fixes, but a long-term pensions commission looking at the interaction between pensions, benefits and housing is desperately needed.”

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