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Pensions

Work and Pensions written question – answered on 17th October 2011.

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Photo of Zac Goldsmith Zac Goldsmith Conservative, Richmond Park

To ask the Secretary of State for Work and Pensions whether he has made an assessment of the implications for UK pension schemes of the 2nd Circuit Court of Appeals for the Southern District of New York's ruling of 19 September 2011 on Aguinda v. Chevron; and what plans he has to review pension providers' management of environmental, social and governance risks.

Photo of Steve Webb Steve Webb The Minister of State, Department for Work and Pensions

The Aguinda v. Chevron case concerns a long dispute over the environmental damage caused by an oil company in Ecuador. On the 19 September 2011 a US court overturned a block on Ecuadoreans collecting damages totalling $18.2 billion (£11.5 billion) from Chevron over Amazon oil pollution.

The law already requires that an occupational pension scheme's ‘Statement of Investment Principles’ must include a declaration of the extent to which social, environmental and ethical considerations are taken into account in the scheme's investments. The statement must also include the scheme's policy (if any) in relation to the exercise of the rights (including voting rights) attaching to the investments.

The Government fully support the highest standards of corporate governance and ethical behaviour and consider such high standards can contribute to better company performance, by helping a board discharge its duties in the best interests of shareholders. The Government continue to keep under review the role of pension scheme trustees in the governance process and, in particular, the adequacy of the rules that apply to the investment of scheme funds.

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