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UK gilt stewardship: trustees urged to press LDI managers to engage on government climate policy, consistent with fiduciary duties and TPR guidance after the 2022 crisis

Published on: 29 August 2024

Published by a Law360 reporter
Legal News
Article summary

There has traditionally been a misconception that gilt stewardship is not possible

On 27 August 2024, the consultancy noted that LDI managers, as significant investors in UK government debt (often via bonds known as gilts), ought to actively engage with policymakers to address environmental breakdown. These managers deploy hedging techniques designed to protect pension schemes from swings in interest rates and rising or falling inflation. LCP also said that gilts now play an expanding role in defined benefit pension portfolios, and that trustees should press their LDI managers to set out and develop a stronger, more robust approach to engaging with government climate policy...

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