U Impact Blog Series
Visualizing Your Future: The Revolution in Pension Dashboards
A co-authored blog post, written by Seawolf Sustainability Consulting and U Impact.
About the author:
Laurence Norman
Laurence has over 30 years of experience in technology-led business transformation, delivery, and strategy across telecommunications, media, sports, and fintech sectors. His expertise provides profound insights into industry dynamics, offering innovative solutions for multifaceted challenges.
Share this blog:
Recent posts:
Between 2021 and 2022, 7.5 million UK residents invested £12 billion annually in private pensions. In 2023, the government mandated pension providers to offer dashboards detailing plan performance and projections. Using a car dashboard analogy, this simplifies complex financial information and aligns investments with personal values, focusing on environmental and social impacts. Seawolf Sustainable Consulting and U Impact lead in facilitating this transition, offering training and software solutions to navigate sustainable investing regulations. Through workshops and strategic planning, they assist companies in understanding ESG regulations and preparing for market leadership, emphasizing the transformative potential of integrating sustainability into pension management.
Introduction
Between 2021 to 2022, 7.5 million people in the UK were members of private pension schemes, investing more than £12bn every year. Pensions are one of the most significant financial investments individuals make in their lifetime. However, how many people have a good understanding and are able to visualise their pension arrangements in a holistic way? How many comprehend the financial and non-financial implications of their investing activities?
In 2023 the UK government introduced new legislation requiring pension providers to give their members information in the form of a dashboard detailing their plan, performance and future illustrations. The rules covered in PS22/12 are designed to engage more people with their pensions, increase transparency, inform investment decisions and assist with retirement planning.
The concept naturally focuses on simplifying financial information and investment choices (the Return and Risk part). However, we feel there is an opportunity to extend this to the 3rd R: “Responsibility”. With more than £2.5 Trillion under management, there is a unique opportunity to direct significant capital towards truly impactful, positive long-term change for good.
A car dashboard analogy
Using an analogy, one can think of a car dashboard. While driving, a suite of indicators enables a driver to arrive at their destination and make informed (and better) decisions: The speedometer will signal how fast the car is going, helping to remain within the legal limit; the fuel indicator light will signal petrol/energy depletion, and the GPS will show where the next service station is.
Applying such a concept to pensions, a dashboard will help individuals understand their current and future financial status as well as the environmental and social impacts of their pension contributions. Can we view our pensions more holistically and drive decisions according to our personal values as well as our financial goals?
Just like a car dashboard, we can use a suite of indicators to manage our pensions. For example, assessing certain sectors known to have significant externalities, for example, defense, tobacco or the oil and gas sector. Some economists will even assess that some of these companies’ assets will be stranded in the mid/long term, hence potentially holding far less financial value than estimated due to environmental or social challenges.
A well-designed pension dashboard simplifies complex information without losing the criticality of the underlying data. The presentation has to be intuitive enough that a lengthy training is not required, pleasant enough that individuals choose to use it, and trusted enough that one can make important decisions from it; “I can just about squeeze in a few more miles to get to the next service station!”
A good pension dashboard reduces the choice burden for contributors while enabling them to fully engage with, and direct funds to the outcomes that matter to them, and represents a significant differentiator and a huge business potential for pension providers.
Pensions represent the most significant asset anyone owns in their life (yes – it should be worth more than your house!). It is also the epitome of long-term, future planning. From the first contribution to the final collection may represent 60 or 70 years – so isn’t it time we consider what kind of world we want to retire into and how your money can work towards that?
Identifying the path forward
CP22/3 and other sustainable investing regulations are often used from a risk perspective. However, they are not only about meeting the minimum ‘do no harm’ requirements. There is also a possibility to move ahead and create a much broader engagement tool.
The customer pull and regulatory push towards digital empowerment and sustainable investing are evolving and are challenging topics to navigate successfully in order to meet compliance needs and gain market opportunities.
Through facilitated workshops and strategic road mapping, we help companies understand the critical sustainable investing regulations, including risks and opportunities. We work with you to define focused, challenging and achievable roadmaps to deliver those outcomes and anticipate scenarios and plans to prepare for the unpredictable.
Ready to try yourself?
Get in touch for an online 2 – 3 hour facilitated training session offered by experienced finance professionals from Seawolf Sustainability Consulting and U impact to see how we can help you in your journey to market leadership.
Who's behind this post?
Seawolf Sustainable Consulting
Seawolf Sustainable Consulting is focused on managing the world of Environmental, Social and Governance (ESG) investment frameworks and sustainable regulations, methods and outcomes for enterprises and investors. Our team and roster of consultants have deep expertise in financial services, and provides executive training and sustainability consulting.
U Impact
U Impact provides a SaaS Sustainable Investment Solution to financial institutions. It enhances end investor engagement through gamification, behavioural science, and Gen AI, encouraging a shift towards sustainable funds. U Impact has the mission to mobilise capital into sustainability, making investment a catalyst for change.