We're making changes to your workplace pension

Diversification, or having a mix of different investments, is crucial for spreading risk. This is because different types of investments can perform better or worse than others at different times depending on many factors, such as the state of the economy, interest rates, and world events.  So, if one type of investment falls in value, others could rise in value, cushioning the impact. 

This is where we focus our attention, aiming to ensure our pension funds have the right mix of investments – also known as assets – in the right amounts to achieve the best possible returns over the longer term. This is called asset allocation. 

We believe asset allocation accounts for most of the long-term performance of pension funds, so making the right choices is vital.  

Our specialists regularly review and adapt the investments in your pension.  This might be because of changes in markets, changes in their view of the long-term potential of different investments, or if they see new investment opportunities. 

PIA funds have historically invested more in UK company shares.  

We’re adopting a more globally-diversified approach, with the aim of enhancing risk-adjusted returns by capturing more growth opportunities in high-performing international markets. 

We're moving customers' PIA pension savings to the new asset mix gradually over 2025.  

The way we invest isn’t only important to help you reach your retirement goals. It can also have an important role to play in shaping a better world to retire into. This is because the money you’re saving into your pension is likely to be predominantly invested in companies. These companies have an impact on the world around us. By investing in them, we can have an impact too.   

It’s important we take into account how companies behave in relation to the planet and people, and the way they’re managed. These are known as environmental, social and governance factors – or ESG for short.  

We’re enhancing our responsible investment approach to better manage ESG opportunities and risks in our PIAs. 

We’ll invest more in companies with stronger ESG credentials. These include companies that are fair and inclusive, those working hard on things like reducing their negative impact on the planet and society, reducing their carbon emissions and those developing environmental solutions like clean energy. They’re typically better positioned to adapt to long-term challenges, such as climate change.  

We’ll invest less in companies we believe aren’t dealing well with ESG factors – like carbon emissions, waste and water management, workers’ rights, gender equality and board diversity. They’re more likely to suffer falls in their value from scandals or fines, or because they’ve fallen out of favour with their customers or investors.  

We won’t invest in companies we believe present too much investment risk due to the nature of their businesses and the negative impact they have on the planet and society.  

Find out more about our responsible investment approach

For customers invested in a PIA, when you're years away from your selected retirement age, we invest with the aim of giving you what we believe is the best chance of growth. As you get closer to your selected retirement age, we gradually move your pension savings into lower-risk investments with less growth potential. This is known as a ‘glidepath’ and aims to help protect your pension’s value.

Currently, we start to move you into lower-risk investments from 15 years before your selected retirement age. We’re shortening this to 12 years, meaning your pension will be in higher-risk investments with greater growth potential for longer.  

Your PIA currently moves a significant amount of your pension to cash-type investments starting when you’re five years from your selected retirement age. While cash investments can protect your pension pot's value in the short term compared to other types of investments, they typically produce lower long-term returns and might not keep up with price inflation.  

• If you’re in a PIA that’s targeting flexible access or annuity, we’ll be removing this build-up of cash.  
• If you’re less than 3 years to your selected retirement age you’ll retain an allocation to cash.
• If you’re targeting encashment (taking all your pension as a cash lump sum) you won’t be affected by this change.