Aegon default invests £3bn in BlackRock ESG fund range

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Wondering what Aegon's investment to BlackRock's ESG initiatives means? Read Hope William-Smith's piece from Professional Pensions to learn more.

Aegon UK is set to transition £3bn of assets from its workplace default fund into BlackRock’s new ESG index fund range.

The investment - announced today (26 April) - will double the ESG exposure in the default and see workplace pension holders monies placed into a range of six equity index mutual funds co-developed between Aegon and BlackRock.

Aegon today said the new fund range aims to meet the needs of pension scheme members for"core replacements of standard building blocks that maximise a fund's ESG credentials". It also confirmed fund charges, risk appetites and performance expectations will not change.

The new range will be used alongside an existing BlackRock ESG fixed income index fund as the new underlying offerings for the Aegon Workplace Default.

Total ESG exposure in the default will now sit at 60% for growth stage investors. A range of other Aegon default options will join the flagship in the transition.

Managing director Tim Orton said increasing the ESG exposure in the default was"a significant step forward" for the firm.

It comes as Aegon builds on its target to achieve carbon net-zero across its default pension funds by 2050. The firm also confirmed it was well on its way to halving carbon emissions in line with Paris Agreement goals by 2030, with this latest transition bringing its total to around £15bn in the last three years.

"The progress we have made in this area also demonstrates our commitment to manage the risks associated with climate change," Orton added.

"Around 90% of scheme assets are often invested in passive default funds and therefore we have a responsibility to ensure our investment actions are meeting the evolving needs of our customers."

 

This article was written by Hope William-Smith from Professional Pensions and was legally licensed through the Industry Dive publisher network. Please direct all licensing questions to legal@industrydive.com.