Pensions Bulletin 2025/32

FCA review of climate disclosure compliance 

The Financial Conduct Authority (FCA) has published a multi-firm review assessing how asset managers, life insurers, and FCA-regulated pension providers are complying with climate-related reporting obligations under the TCFD (Task Force on Climate-related Financial Disclosures) framework implemented by the FCA in 2021. The review focuses on both entity-level and product-level disclosures, highlighting successes and identifying areas for improvement — including clarity, consistency, and completeness of reporting. 

The review found an overall increase in regulated firms’ consideration of climate risks that supported their integration into firms’ decision-making. Firms were more transparent with their clients and consumers but encountered some challenges with the availability of data and consistent, well-developed methodologies. 

Specifically: 

• Risk management - the rules have helped firms to consider climate change as a material risk, build their capabilities and integrate climate risks and opportunities into their strategies. The rules have also helped firms to be more transparent with their clients and consumers about how they take into account climate risks when managing or administering assets on their behalf. 
• Audience - while detailed climate disclosure information is helpful for some institutional investors, the disclosures may be too complex for retail investors. As such, firms said they receive limited response from retail investors on their TCFD reports, particularly at product level. 
• Accessibility - while entity reports were broadly accessible from a firm’s main webpage, product reports were often difficult to find. This may have contributed to the lower levels of engagement at product level by retail investors. 
• Data - firms were generally able to report on backward-looking data, such as carbon emissions. But some firms found it more challenging to provide quantitative data to support forward-looking disclosures, such as scenario analysis. For example, only around half of the product reports reviewed disclosed the impact of all three climate scenarios on the fund, as required. This limited comparability between reports. 
• Proportionality - firms, particularly asset managers, noted that they are required to report under multiple sustainability disclosure regimes and considered FCA TCFD rules too granular. They suggested that sustainability disclosures could be simplified and streamlined. 

The FCA’s next steps include: 

• Simplify disclosure requirements and ease unnecessary burdens on firms. 
• Maintain good outcomes for clients and consumers and improve the decision-usefulness of reporting, building on the work of sustainability disclosure reporting (SDR) to improve trust and reduce greenwashing. 
• Promote international alignment and help maintain the UK’s position as a global leader in sustainable finance. 

The FCA will consider sustainability reporting as a whole. This includes SDR, the ongoing endorsement of the International Sustainability Standards Board (ISSB) standards (known as UK Sustainability Reporting Standards), and developments on transition plans. They will continue to work closely with the Government and regulatory counterparts to support consistent outcomes along the investment chain and engage further with industry to guide our next steps. 

Dashboard updates 

The Pensions Dashboards Programme (PDP) has provided an update on its approach to consumer testing of the MoneyHelper Pensions Dashboard (see Pensions Bulletin 2025/28).  

The PDP say that the success of pensions dashboards depends on creating a service that's accessible, trustworthy and genuinely useful for consumers. Through rigorous testing with real people viewing real pensions data, the PDP says they can identify and resolve issues before pensions dashboards become widely available. This process will also generate valuable insights that could benefit the pensions industry as a whole. 

Key elements include: 

• Industry collaboration - with expert testing as a first step. 
• Three-step testing framework - following the first step of testing with industry experts, second step targeted consumer testing with a small number of users and third step increasing volumes up to 20,000 users. 
• Inclusive and representative testing - including an aim for around 20% of participants to have access needs or low digital skills. 
• Recruitment and engagement - two phase programme for recruitment of test subjects. 
• Sharing insights - a commitment to proactively sharing the results of the testing with the pensions industry. 

Additionally, following the announcement in July that 20 million pension records have been connected to the dashboard ecosystem (see Pensions Bulletin 2025/28) the PDP have now announced that over 40 million (over half of the total records) have now been connected.