One-year Progress Report - Sustainability Principles Charter for the Bulk Annuity Process

A year since the launch of the Sustainability Principles Charter for the bulk annuity process, tangible progress has been made in implementing the principles behind the Charter and increasing efficiencies in the bulk annuity process.

The cross-industry initiative – of insurers, pensions and advisers – was established by A4S, the Church of England Pensions Board and Railpen to ensure sustainability is consistently considered in the bulk annuity process. The Charter now has over 30 signatories who have signed up to adhere to its four principles on transparency, decision making, reporting and engagement, and collaboration. These signatories represent 97% of the UK bulk annuity market, £100 billion in pension assets under management and over £3.1 trillion in assets over advisory.

Informed by insights from signatories, this one-year progress report demonstrates how sustainability has been further integrated into the process, with the Charter allowing greater scope for productive engagement on sustainability-related topics to take place.  

If you would like to find out more about this initiative, please email info@a4s.org.

This report outlines the progress made, including:

• Reducing annual sustainability surveys from ten to one – All insurer and adviser signatories will adopt the newly created Bulk Annuity Sustainability Survey (BASS), a single sustainability survey for the selection process of bulk annuity providers replacing the multiple versions used across the advisory sector.
• Setting a high bar – the Charter, and the BASS, provide a consistent and ambitious expectation of how sustainability should be considered in the strategic and investment decision-making processes of bulk annuity providers. 
• Growing the prominence of sustainability within the process – bulk annuity transaction announcements are starting to reference the Charter and sustainability considerations as a primary selection criterion.
• Driving conversations about systemic risk – the Charter has enabled consistent discussions between pensions, insurers and advisers on how systemic risks are being considered within the investment decision-making processes.