Year-end reviews can feel overwhelming—piles of performance reports, dense presentations, and more jargon than anyone needs. But this annual checkpoint isn’t just about looking back. It’s a timely opportunity for trustees, staff, and beneficiaries alike to help steer the fund toward stronger returns and a more climate-resilient future.

Climate risk and the economic opportunity in climate solutions are central to the conversation. Here’s how to cut through the noise, ask smart questions, and ensure your fund is prepared for tomorrow while delivering today.

Key Areas to Watch & Where Climate Fits

Performance and Policy

Performance and policy reviews are staples of any pension fund’s year-end meeting. These discussions delve into how the fund’s investments have performed against benchmarks and examine whether current policies effectively manage risks—including those posed by climate change. Paying close attention to these areas ensures that your fund’s strategy not only delivers solid returns but also adapts to the evolving challenges and opportunities of a climate-conscious world.

You’ll hear:

Reports on returns (often by sector) and “benchmarks”—did the fund hit expected returns and stay within risk margins?

What to watch for:

Strategic Asset Allocation (SAA): Does your plan’s SAA (its long-term mix of stocks, bonds, etc.) address climate risk head-on? Look for strategies like increasing sustainable investments, engaging companies for better climate disclosures, or using climate-related indices.
Climate Opportunities: Are there investments in adaptation, mitigation, green energy, or projects supporting a Just Transition (ensuring workers and communities are cared for in the shift to a low-carbon future)?
Investment Policy Statement (IPS): Does the IPS name climate risk as a fiduciary duty? Clear, flexible policies can help funds act on new climate opportunities and hedge systemic risks.

Actions you can take:

Call for periodic reviews of the SAA, emphasizing climate risk and opportunity.
Ask how climate solution investments are incorporated into long-term goals.
When risk assessments are discussed, inquire how (and if) findings are translated into real investment decisions.
Check if the IPS defines climate risks; if not, raise what’s at stake for the fund and its beneficiaries.

Stewardship & Engagement

Beyond managing investments, pension funds play a powerful role in shaping corporate behavior through stewardship and engagement. By actively voting on shareholder resolutions and engaging with companies on climate strategy, funds can influence progress on emissions reductions, transparency, and long-term sustainability. Understanding and supporting these activities ensures that your fund’s voice is aligned with the values and best interests of its members.

You’ll hear:

Reports on shareholder voting, proxy records, and company engagement strategies.

What to watch for:

Has your fund joined alliances or supported climate-related resolutions?
Are there examples of successful engagements, new climate disclosure, or changed behaviour at key companies?

Actions you can take:

Request a summary of engagement outcomes, not just activities.
Ask if proxy voting and stewardship align with the fund’s stated climate/investment goals.

Quick Questions for Your Year-End Review

Knowing what to ask is key to making year-end reviews more meaningful and future-focused. Whether you’re a trustee, staff member, or beneficiary, bringing pointed questions to the table can spark productive conversations and help ensure climate risk and opportunity get the attention they deserve. Here are a few powerful questions to guide your engagement:

How does the fund measure and report annual climate risk exposure?
What progress has been made on net-zero or science-based targets?
Can you share examples where scenario analysis led to new investment or policy?
Are there checks in place for climate impact and transition readiness at the sector or asset class level?
How does stewardship (voting, engagement) support climate risk mitigation?

Even a single question can open the door to accountability and encourage your fund to take concrete steps toward managing climate risk and harnessing new opportunities.

Why This Matters

Year-end reviews aren’t just about compliance; they’re our chance to ask tough questions, push for accountability, and ensure the fund manages today’s risks—while investing in tomorrow’s opportunities. Climate-resilient strategy isn't just good governance; it’s a vital part of securing members’ futures.

Want a deeper dive? Download the full A Guide to Pension Funds’ Year-End Review for more strategies

Jargon Buster (Glossary)

Tracking Error: How much a fund’s return differs from its benchmark.
Strategic Asset Allocation (SAA): The long-term plan for dividing investment across asset classes to meet goals and manage risk.
Just Transition: Ensuring social fairness as the economy shifts to low-carbon, sustainable solutions.
Investment Policy Statement (IPS): A guiding document that outlines how the fund invests and manages risk.

Making the Most of Your Pension Fund’s Year-End Review