Nest's climate-conscious equity assets more than double to a staggering £22.8 billion
Nest Pension Scheme Doubles Investments in Climate-Aware Equities
The UK's largest pension scheme, Nest, has significantly increased its investments in climate-aware equities over the past three years. According to the fund's Annual Reports and Accounts, Nest's investments in this area have grown from £12.6bn to £22.8bn, representing a doubling of its commitment.
This strategic pivot towards sustainable investing is part of a broader increase in the overall assets of the fund. Nest's overall assets have grown to £49.7bn as of March 2025, compared to £29.6bn in 2022.
The surge in investments in climate-aware equities is detailed in the Fund's Annual Reports and Accounts released last week. The increase is mainly attributed to strong growth from member contributions.
Nest's current strategy heavily emphasizes climate-aware equities, with a large and growing commitment managed under UBS. The UBS mandate currently accounts for 40% of Nest's overall assets.
Under UBS's management, Nest aims to balance strong, consistent long-term returns with climate impact. The 2045 Nest Retirement Date Fund, representing members in their growth investment phase, recorded a five-year annualized return of 9.9%, exceeding the fund’s long-term objective of achieving returns at least 3 percentage points above inflation.
This integrated approach positions Nest as a leader in combining fiduciary duty with climate-aware investing, leveraging UBS’s capabilities to meet both financial and sustainability goals.
The focus on climate-aware equities is part of Nest’s commitment to influence the investment industry by integrating sustainability into fiduciary management, aiming for positive environmental impact alongside financial returns. Nest's approach also aligns with its purpose to build financial peace of mind and maintain trust with members.
With close to 14 million members, Nest's commitment to addressing climate change and promoting sustainable development is demonstrated by this significant allocation. This integrated approach positions Nest as a leader in the pension industry, using its large asset base and default strategy adherence (~99% members) to drive sustainable investment practices and outcomes.
The Nest Pension Scheme, initially established in 2011, appointed UBS to manage its developed equity strategy. The increase in investments in climate-aware equities is a response to growing interest in sustainable and environmentally-friendly investments.
Of Nest's members, 3.9 million are contributing members. The fund returned a profit for the first time in 2024/25, helped by investment returns and membership growth, supporting repayment of its government loan by 2038. This integrated approach positions Nest as a leader in combining fiduciary duty with climate-aware investing, leveraging UBS’s capabilities to meet both financial and sustainability goals.
- The Nest Pension Scheme's substantial growth in investments, particularly in climate-aware equities, is a testament to its commitment to environmental science and climate-change initiatives, as it capitalizes on opportunities in the financial market for sustainable and environmentally-friendly investments.
- As part of its integrated approach, Nest Pension Scheme has allocated a significant portion of its assets to environmental science, with 40% of its overall assets managed under UBS, aiming not only for strong, consistent long-term returns but also for a positive environmental impact.
