Standard Life leads adviser marketplace by investing in labelled funds under SDR regime for its Future Advantage multi asset range, creating a dedicated sustainability improving approach across multiple asset classes with explicit Net Zero objectives, designed to optimise investment returns over the long term.
Standard Life, part of Phoenix Group, continues to embed sustainable investing principles to improve financial outcomes across, its multi asset offerings with the successful adoption of Sustainability Improvers™ labelling for customers invested in its Future Advantage fund range.
In December 2024, Standard Life announced that having received the regulatory green light it intended to be the first mainstream provider to adopt Sustainability Improvers™ labelling to promote high standards in sustainable investing, integrity and transparency with a focus on driving better financial returns for customers.
Since then, it has undertaken the adoption of the approved labelling, creating what’s believed to be the industry’s first multi asset fund range that broadly aligns to the Sustainability Improvers™ label.
Standard Life is also investing in these labels across its pension defaults offered to Workplace, and Retirement Income customers using Investment Pathways.
Warren Bright, Head of Retail Intermediary and Private Client Distribution, at Standard Life said: “We have worked hard to be one of the first in the off-platform market to embrace the FCA’s new Sustainability Improvers™ label across a majority of assets in our core multi asset fund range for advisers. Our research tells us that 79% of Intermediaries’ advised clients expect their pension provider to be investing responsibly on their behalf. With our Future Advantage solution targeting a sustainability objective, our approach is intended to improve investment outcomes while providing high levels of transparency through enhanced disclosures. It’s an iterative process where we expect future developments to be part and parcel of our focus.
“In line with the Sustainability Improvers™ label, our underlying funds are being invested mainly in transitioning companies. We’re optimising outcomes: enhancing how we manage climate-related risks and opportunities, while establishing a more explicit alignment towards net zero by 2050. The changes we are making are explicitly designed to deliver good investment outcomes and allow advisers to access responsible investment options on behalf of their clients. These evolved component funds are designed to give broad market returns.
“We will deliver this approach in line with our new customised sustainable index methodologies, which are based on the FTSE Climate Aligned Benchmarks announced by Phoenix Group earlier this year. Our future proofed underlying funds adopting this approach have received FCA approval after a lengthy period of positive engagement with the regulator. Our custom index methodology combines alignment with 2050 climate transition targets alongside forward-looking insights, including those available from the Transition Pathway Initiative. This is a truly modernised approach, which is expected to improve long-term financial outcomes for customers. In this regard, we believe that we are the first UK off-platform provider to embed the SDR labelling regime across our off-platform multi asset fund range – Future Advantage.”
Standard Life’s commitment is underpinned by principles that include Focused Outcomes, Future Proofing, Responsible Investment, Robust Governance and Independent Investment.
In embedding the new labelling regime, the Standard Life investment team has focused ensuring that its core solutions continue to deliver good customer outcomes while complying with an evolving regulatory landscape. Its future-proofing capability allows it to seamlessly make any necessary changes with minimal impact on clients without changes to strategic asset allocation, risk models or costs.
By having solutions with responsible investment built-in, Standard Life is aiming to reduce cardon footprint of equity and corporate bond investments by 7% a year, and by 50% by 2030, reaching net zero by 2050, compared to a 2019 baseline*. As a result of introducing the Sustainability ImproversTM pension savers are expected to benefit from improved long-term financial outcomes and greater transparency with the completion of the transition to the new regulatory disclosures.
*Scope 1 and 2 EVIC Economic Intensity basis measured by Tco2e/$m calculated on a geometric average basis. Data assumptions have been made in some cases.
