Governance Financial Statements
Strategic Report
23
BIGGER, BETTER, BRIGHTER. We are committed to meeting the needs of our customers and supporting growth in the UK economy, by actively evolving our approach to investing. Our key priorities are: Skills and capabilities Continue expanding skills and capabilities to effectively source, manage and monitor investment opportunities. Scale with technology Leverage technology to automate processes and enhance efficiency of tools used in the investment decision making process. Asset origination Continue to enhance our ability to originate assets and explore new asset classes both internally and via external managers. This includes assets and asset classes which may qualify under the highly predictable cash flow amendment introduced in Solvency UK. Responsible investment Build on the foundations laid in previous years to take a more sophisticated approach to responsible investment integration within the investment processes.
We continue to leverage external managers, with specialist areas of expertise, to source new asset classes and investment
opportunities to meet our investment needs. Further integrating responsible investment
In 2024, we continued enhancing our approach to integration of responsible investment. Key milestones achieved in the last year include: • Successfully gained signatory status, upon first application to the Financial Reporting Council’s UK Stewardship Code. • Enhanced our Sustainability Bond Framework to align with market standard and successfully issued a £400m Sustainability Tier 2 bond. • Further integrated climate change into investment decision making through improvements in tools, processes and documentation. • Enhanced our internal scoring system, PAYG, expanded exclusionary criteria and incorporated newly established sector views. We are committed to meeting the needs of our customers and supporting growth in the UK economy, by actively evolving our approach to investing. Read more about PAYG scoring system on p49 Sustainable Investments In 2024 we invested a total of £315m in assets aligned with our Sustainability Bond Framework. Below we summarise our current allocation towards sustainable assets, which includes investments aligned with our Sustainability Bond Framework, classified as ‘green’ under our internal PAYG scoring system as well as other public market labelled bonds:
31 December 2024 £m
31 December 2023 £m
Sustainable assets (IFRS valuation basis) 1 Renewable energy – wind Renewable energy – solar Affordable and social housing
335 363
371 387
1,528
1,142
56 95
41
Green buildings
–
Clean transportation
Access to essential services / local authority
271 226 731
196 383 497
Other social assets
Green, social, sustainability bonds Total dedicated sustainable assets Bond portfolio and Other assets Dedicated sustainable assets %
3,605
3,017
19,581 17,141 19% 18%
1 S ustainable assets includes the £919m invested over 2022 – 2024, exceeding our three-year target of £750m. The amount invested in 2024 was £315m.
More information on our responsible investment progress, processes and frameworks can be found on our website.
Powered by FlippingBook