Kingston upon Thames Pension Fund has set an ambitious target to achieve net-zero emissions by 2050, with significant interim goals to reduce carbon intensity and invest in climate solutions. These commitments were detailed in a report presented to the Pension Board on Thursday, March 26, 2026, outlining the fund's progress on responsible investment and stewardship. The report included a revised Responsible Investment Policy and the fund's first Annual Stewardship Report, both available for review here.
The fund's revised responsible investment policy introduces a specific exclusion for companies involved in the development of components for controversial weapons. These are defined as incendiary weapons, cluster munitions, anti-personnel mines, biological and chemical weapons, blinding laser weapons, and depleted uranium weapons. This exclusion is implemented through the London CIV's 'Three Pillar' approach. The policy also emphasizes engagement with companies to influence positive real-world change, rather than immediate divestment.
Key interim targets include reducing the weighted average carbon intensity (scope 1 & 2) of listed equities by 50% by 2030, relative to a 2020 baseline. As of March 2025, the fund's carbon to value metric has shown a steady reduction, exceeding the 2030 interim target. Furthermore, the fund aims to increase the percentage of companies with Science Based Targets initiative (SBTi) approved targets. As of the end of March 2025, 52% of the fund's investments in listed equities were with companies that have set science-based targets.
An additional interim goal is to invest 15% of total fund assets into climate solutions by 2030. The fund's commitment to responsible investment is further demonstrated through its impact investing strategy, with a 10% strategic allocation. Investments in affordable housing and renewable infrastructure are highlighted as key examples. For instance, the LCIV UK Housing Fund is expected to deliver 3,500-4,000 homes, while the LCIV Renewable Infrastructure Fund has already generated an estimated 834,270 MWh of renewable energy, enough to power 278,090 homes, and avoided 706,597 tonnes of CO2e emissions.
The fund aims to influence positive real-world change through engagement, focusing on areas such as climate change, human rights, and strong corporate governance. The London CIV tracks engagement progress using a four-stage milestone system: concern raised, company acknowledges concern, company develops credible strategy/targets, and company implements strategy/measures. For impact investing, metrics are aligned with the UN Sustainable Development Goals (SDGs), categorized by Intentionality, Additionality, and Reporting/Metrics.
The Annual Stewardship Report details the practical implementation of the fund's responsible investment policy, including engagement activities conducted through the London Collective Investment Vehicle (LCIV), underlying investment fund managers, and the Local Authority Pension Fund Forum (LAPFF). These engagements have included discussions with companies on biodiversity, human rights, and climate transition plans.
The fund's overall market value of assets at December 31, 2025, stood at £1,428 million, an increase of £28 million over the previous quarter. The fund achieved a positive return of 2.1% over the quarter, outperforming its benchmark. Further details on the fund's financial performance and strategy can be found in the Pension Fund Business Plan and Budget Update and the 2024/25 Pension Fund Accounts Audit Outcomes Report.
