Making your pension fund more sustainable

How can you influence the investment policy of your pension funds? How seriously do the funds take their responsibility in terms of climate protection? And what about social justice? Answers to the most important questions.

Why do pension funds play a role in climate protection?

Swiss pension funds manage assets of over 1400 billion Swiss francs. They bear responsibility for global warming if they invest parts of it in coal mines or oil companies. These are industries that emit large quantities of greenhouse gases. In order to limit global warming, the pension funds must invest their money in environmentally friendly sectors with a promising future.

Are pension funds obliged to protect the climate?

The Paris Agreement places an obligation on the financial industry and thus on pension funds. Financial flows must be structured in such a way that global warming is limited to well below 2 °C, if possible to a maximum of 1.5 °C. Our country has approved the agreement. Therefore, this requirement also applies to pension funds.

Why must pension funds take climate protection seriously?

Climate change leads to considerable risks. If your pension fund invests pension assets in companies that disregard the climate problem, this can lead to major financial losses. This is shown by figures from Ethos, the foundation for sustainable investments and active shareholders. It estimates that pension fund investments worth CHF 200 billion are at risk.

How can I find out how sustainably my pension fund invests its money?

You can find out directly from your pension fund whether it invests pension assets sustainably. 

How can I influence my pension fund?

Depending on the type of pension solution, the employee representative body has a right of co-decision on the investment strategy of the pension fund. This ensures that funds are invested responsibly. For example, that no investments are held by CO2-intensive companies. With certain pension funds, insured persons can choose the investment strategy.

Does it make sense for me to be elected to the pension fund's board of trustees?

As a member of the Board of Trustees, you can often directly influence the direction of the pension fund. In many cases, the board of trustees can determine the investment strategy. As a member of the foundation board, you can, for example, demand that your pension fund increases transparency or takes better account of sustainability criteria.

Are the pension funds taking responsibility for climate protection?

Only partially. There is still a considerable need for action. This is shown by various studies that examine the investment policy of pension funds. The Confederation regularly publishes the results of a survey of pension funds. The most comprehensive analysis is provided by the Climate Alliance, an alliance of 140 civil society organisations, including Helvetas, Swissaid, VCS and WWF.


The results of the Climate Alliance

What marks does the Climate Alliance give the pension funds?

Just under a quarter of the pension funds act in a climate-friendly manner. They invest in such a way that the greenhouse gas emissions financed with the investment funds continuously decrease. The remaining three quarters continue to finance the fossil fuel economy. This means that the global climate goals are missed.

How does the Climate Alliance come to this conclusion?

The Climate Alliance assesses whether pension funds are on track to achieve a net zero target before 2050. Over 165 pension funds are covered. They manage around three quarters of all pension assets in Switzerland. The remaining quarter of the funds is managed by over 1200 pension funds. These are mainly pension funds of private companies that do not disclose any information about their investment policy. There is also a need for action here.

How can I check how my company's pension fund is performing?

At the Climate Alliance rating, a short report can be downloaded for each of the pension funds examined.

How does the Confederation assess the climate strategy of the PFs?

In 2022, the test was conducted for the second time. It shows improvements, but there are still deficits. For example, pension funds hold investments from oil and gas production companies that continue to expand their capacities. The conclusion of the study is clear: the way the pension funds invest their pension assets, the targets of the Paris Climate Agreement cannot be achieved.

Sustainability goes further than climate protection. How seriously do pension funds generally take environmental and social issues?

According to a survey by the Swiss Pension Fund Association, only 35 per cent of the funds have anchored a sustainability strategy in their investment regulations. Therefore, the pension fund association advises its members to pay more attention to how their investment policy affects the environment and society.


Anne-Valérie Geinoz

Anne-Valérie Geinoz