07 Jul 2025
The Pensions Regulator (TPR) will work with industry stakeholders, advisers and professional bodies to develop and test a voluntary net zero transition plan template fit for occupational pension schemes, drawing on the work of the UK Transition Plan Taskforce (TPT).
Transition plans can help organisations, including occupational pension schemes, prepare for the government’s goal of transitioning the UK to a net zero nature-positive economy by 2050.
Developing them is a proactive step trustees can take to help their schemes manage transition risks, such as investments in fossil fuels or other high-carbon industries losing value or the impact of market volatility. They can also help trustees capitalise on the investment opportunities and promote sustainable investment.
However, there is no one transition plan template designed for and tailored to occupational pension schemes and TPR has announced it is working to create one with industry’s help through a transition plan working group.
Julian Lyne, TPR's Interim Executive Director of Market Oversight and Chair of the planned working group, said: "Sustainability initiatives should improve investment governance practices and help schemes make good long-term strategic decisions.
"That is why we plan to work with industry in advance of any legislation to make sure we deliver a transition plan template made by industry for industry and that provides high standards of stewardship and helps mitigate financially material systemic risks."
Although not currently a mandatory requirement, transition plans have the potential to catalyse change and help shape investment decisions in the interests of savers.
Raising trustee awareness of transition plans and their benefits has been an area of ongoing focus for TPR.
Mandating transition plans aligned to the Paris Agreement goal of limiting global temperature rises to 1.5C was included in the Labour Party's pre-election manifesto.
TPR said the ultimate template will be based on the framework and guidance developed by the TPT and will be presented to the Department for Work and Pensions this year.
TPR Press Office
pressoffice@tpr.gov.uk