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Demonstrating excellence in responsible investment

PPF core RI beliefs

  1. By acting as a responsible and vigilant asset owner, we can protect and enhance the value of our investments.
  2. ESG factors can have an impact on the performance of our investments, and the management of ESG risks and exploitation of ESG opportunities can, particularly for a portfolio-wide issue like climate change, add value to our portfolio.

Our three priorities under our RI strategy are climate change, stewardship and transparency. From a thematic issue perspective, we give particular attention to climate change, D&I and modern slavery within our voting decisions.

We have seen significant progress in our managers’ own ESG practices, as evidenced by the growth over the last few years in the number of our external managers who have become PRI signatories (from 70 per cent in 2020 to 90 per cent at the end of 2022). We also engage with underlying issuers and use our voting powers to advocate for strong ESG and climate-related practices.

We recognise that by far the greatest impact of the PPF lies within our investment portfolio. As a major part of our sustainability strategy, we will continue to incorporate ESG and climate-related risks and opportunities into our investment process and stewardship activities, striving to demonstrate excellence in RI. We will also leverage opportunities to collaborate and lead by example within the pension fund and asset management communities.

2024/25 KPIs

  • We will outline our path to alignment for transition using the guidance from the HM Treasury Transition Plan Taskforce (TPT) for Asset Owners.

Ensuring effective stakeholder engagement with integrity and respect

Employee and stakeholder engagement

We recognise the importance of excellent communication and relationships, with internal and external stakeholders, to ensure the effectiveness of our Sustainability Strategy. The strategy itself is a result of effective stakeholder engagement and its success rests on our ability to bring them along with us on our journey.  

Employee engagement is key to the responsible management of Human Capital and is considered a relevant issue by the Sustainability Accounting Standards Board (SASB). Our well-established ICARE values, which underpin this strategy, are embedded in all that we do at the PPF. They form part of our recruitment and performance management processes and are key to our culture, forming part of the language of the organisation.

We are proud to have high levels of employee engagement. In our most recent employee survey, 95 per cent of people agreed that the PPF makes a positive difference to the world we live in, and 87 per cent said they feel proud to work for the PPF. We make effective use of a number of communication channels including our intranet, Town Halls, office screens, newsletters, network groups and Employee Liaison Committee. We promote a ‘speak up’ culture, where employees are encouraged to share views and ideas, raise concerns and give feedback and we provide 25 channels for doing so. We make sure these are listened to, considered and acted upon where possible, by placing equal value on a ‘listen up’ culture. As well as being essential to our inclusive culture, it’s also essential to accountability and risk management. For example, this strategy addresses some human capital risks: focusing on employee engagement mitigates the risks of failing to attract and retain talented people.

We also consider our external reputation to be critical to our ongoing success. We work hard to build and maintain strong relationships with external stakeholders including our members, levy communication with these groups, we understand the issues that matter to them and our effectiveness in fulfilling our role. 

Community impact

We believe we can use our collective skills and experience to make a genuine impact in the communities and industries in which we operate. We have adopted a new Community Impact approach, replacing our previous CSR activities. We’ll encourage all our employees to use the five days annual volunteering leave available to them and we’ll create volunteering opportunities where people can use their skills and experience in different ways, with a focus on supporting underrepresented groups and the environment. Our people have also chosen a local charity to support, Lives Not Knives, where our employees’ fundraising and volunteering can make a real difference, particularly to our local community. 

We will build partnerships and volunteer with industry and local organisations that:

  • Promote financial literacy and IT skills in the community
  • Give us ways of boosting the pipeline of talent from underrepresented groups in the financial services industry and related professions
  • Support the transition to Net Zero

2024/25 KPI

  • We will maintain our number of volunteering hours – recognising the importance of how we shape the industry and give back to our local community.

Championing collaboration and leading by example

Diversity and Inclusion

Since beginning our D&I journey in 2018 we’ve made meaningful progress and have set ourselves ambitious targets. We voluntarily report our ethnicity and disability pay gaps, in addition to our gender pay gap, and have set ethnicity representation targets as a first step to effecting change. We achieved our original Women in Finance Charter target early and raised the bar for ourselves with our current target for female representation in senior roles. In recognition of our commitment to best practice in recruiting and retaining people with disabilities, we’ve been accredited as a Disability Confident Leader – the highest level of accreditation – which requires us to help other employers to become Disability Confident.

We’ll build on the progress we’ve already made in D&I, by extending beyond our current internal focus to considering our supply chain and stakeholders, through our procurement activities and ongoing supplier relationships, our Community Impact work and engagement with industry.

We work hard to bring our people along with us on our D&I journey, through training and two-way communication, and we’re pleased to report that 85 per cent of our employees say we encourage diversity in all its aspects. 

While we have a long way to go to meet our representation targets, partly because many of our challenges are rooted in the industries we work in, we aim to be part of the solution. Through our apprenticeship schemes we provide career opportunities for local people and build our pipeline of talent from underrepresented groups, who we nurture as future leaders. We collaborate with others in the industry to define best practice, such as The Diversity Project, and we work with Investment20/20 to open up careers in the asset management industry to underrepresented groups. We will do more to help open career doors for minority groups through volunteering, communications and engagement.

Influencing others to do the right thing also extends to our sustainable procurement work with our top suppliers and panel firms, and through our RI work with our asset managers and portfolio companies.

Business ethics

We’re committed to maintaining high standards of corporate governance and review our compliance against the UK Corporate Governance Code and the HM Treasury/Cabinet Office ‘Corporate governance in central government departments: Code of good practice.’

Accountability and integrity are two of our core values, and high on our cultural agenda. Therefore, although the PPF is not currently a regulated financial institution, we emulate best practice as if we were regulated. We have adopted ethe Senior Managers and Certification Regim, implementing all aspects of the FCA’s accountability regime that are relevant to the PPF. We are therefore guided by the FCA conduct rules and the Seven Principles of Public Life.

Managing and understanding our opportunities, challenges and risks is critical to protecting our members and achieving our objectives. Effective risk management helps us not only to mitigate risk, but also to make the most of opportunities and take risk. It is integral to the delivery of our strategic plans, including this strategy. Risk identification and evaluation is a key part of our strategic and operational planning process. Our plans evolve in the light of consideration of the external landscape, our internal risk profile and our risk appetite. Managing risk on a day-to-day basis is embedded in all that we do. Our risk framework extends enterprise-wide to ensure a consistency of approach, language, assessment, reporting and escalation.

We have a Conflicts of Interests Policy to identify where a conflict of interest may arise and how conflicts should be monitored and managed. We’re committed to conducting business and our investment activities in the best interests of our beneficiaries, and have comprehensive controls across the organisation to prevent conflicts of interest from affecting them. We take all reasonable steps to prevent potential or actual conflicts of interest, or situations that might be perceived as giving rise to a conflict of interest.

2024/25 KPIs

  • Year-on-year, we will achieve an increase in our representation across all under-represented groups, showing the industries we recruit from that change in this area is achievable and building a pipeline of talent for the future.
  • Through our staff survey, 85 per cent of our people will agree that we are a diverse employer that supports inclusion.

Being accountable for minimising our own environmental impacts

As an arm’s-length body of HM Government, we support the Government’s Greening Government Commitments and reflect the ambitions, commitments and targets through our business operations where possible. As mentioned, we aim to reach Net Zero for our operations by 2035 or sooner.

Our ambition is to operate in a manner which is consistent with the Paris Agreement  by minimising our own environmental impacts. We will aim to reduce greenhouse gas (GHG) emissions from our building management, supply chain, technology and travel activities.

Greening Government Commitments


  • Improve sustainable procurement
  • Develop & deliver Nature Recovery Plans: Making space for thriving plants and wildlife
  • Develop & deliver Climate Change Adaptation Strategies
  • Reduce environmental impacts from ICT & digital services

Building Management

Includes heating, electricity, waste production, paper, and water usage in both our offices (Croydon and Cannon Street).

Procurement and supply chain

Includes our procurement of works, goods, and services and other supply chain activities.

ICT and digital infrastructure

Includes our information technology and digital services.


Includes employee business travel (air, rail and others) and encouraging employees to commute by more sustainable methods.


We have begun reporting against the Greening Government Commitments, examining our energy use, waste performance, paper use, water use and overall GHG emissions. While we don’t yet have the systems in place to report on every measure, we’re working with our suppliers to capture the correct data and we are putting together a better picture of our operational impact on the environment.
We know that our two office buildings are efficient. Our Croydon office has a BREEAM rating of ‘Excellent’, while Cannon Street is rated ‘Very Good’. Neither building has direct combustion facilities onsite, therefore, our scope 1 GHG emissions from combustion are zero. All of the electricity our offices use is sourced via 100 per cent renewable electricity tariffs, which have been in place in both offices since Oct 2019. Gas is not used. 

As we continue to build the picture of our usage and impact, we have been finalising a 2019/20 baseline of our environmental impact, as we stated in our Business Plan 2022/23. There may be improvements to be made on certain areas including paper usage, business travel and recycling but we have already had successes, such as using 100 per cent renewable electricity tariffs. This strategy provides an opportunity to engage and galvanise our people around our sustainability ambitions and this will include ways we can improve our use of resources in the office. 

We have also begun to make progress on reducing our environmental impact through the technology we use. For example, through our cloud migration we have moved away from energy and emissions-intensive data centres; and by encouraging our people to move to accessing their work accounts securely through their own phones, we’ve reduced the number of PPF phones by 72 per cent. 

The risks posed to the PPF, our members, levy payers and employees by the climate change emergency represent a serious external risk. Our approach to external environment risks is to recognise that our ability to control them or contribute to limiting the impact may be limited but we can monitor them and assess their potential impact on us. We’re committed to playing our part in the areas we can directly control and seeking to use our influence to encourage other organisations across the industry to do the same.

We will develop a Climate Change Adaptation Plan, which will include assessing the potential impact of physical risks of climate change on our operations and our resilience to these risks (long- term as well as acute). We’ll also conduct climate change stress tests in the Long-Term Risk Model, which we use to model future scenarios, including stress testing the impact on PPF’s own balance sheet.

We’ll assess the need for an Environmental and Social Management System to help with management and accountability of our operations and sustainability impacts.

Procurement and supply chain

Although our investment portfolio accounts for our biggest impact by far, we also aim to minimise our environmental footprint and increase the positive impact we have through our own supplier relationships. We aim to embed sustainability through our procurement processes and contract lifecycles, focusing on the same themes of climate change, D&I and modern slavery as our RI approach. 

In 2021/22 we piloted an approach to embed social value in our procurements, achieving positive outcomes, with bidders demonstrating actions they’re taking towards improving employee wellbeing, working with communities, social capital and the environment. We now consider sustainability in all our procurement strategies and assess ESG practices and commitments in many tenders, including the suppliers’ Net Zero commitment, carbon reduction plan, commitment to ESG reporting to meet TCFD requirements, and D&I reporting.

Our Sustainable Procurement Statement and Policy captures our approach and governs our practices. Through our Supplier Code of Conductwe communicate our commitments and in turn, we ask our suppliers to effectively communicate the code to their workers, sub-contractors and to any third parties working on our contracts. 

We will communicate our commitment to working with suppliers who share our commitment to sustainable business practices including:

reducing and reporting on their carbon emissions and environmental impact.
promoting equity, D&I in employment and their service provision.
maintaining high standards of conduct and complying with all applicable human rights and employment laws which includes the Modern Slavery Act 2015. 

2024/25 KPI

  • We will publish the reductions achieved to our organisation’s environmental footprint over the strategic plan period by 31 March 2025.
  • 90 per cent of Group 1 and High Sustainability Impact Suppliers will have returned our Supplier Sustainability Report and responded to our Supplier Code of Conduct by the end of 2024/25.