The report is the first since the expansion of the role of IGCs to cover the value provided to customers using Investment Pathways, and to report on their firm’s policies on environmental, social and governance (ESG) issues, member concerns, and stewardship.
The report highlights how the IGC reviewed Royal London’s approach to the launch of Investment Pathways in February. Good progress is also noted on the way the firm is incorporating ESG into the business.
The report is also the first to cover additional information required by the Financial Conduct Authority on costs and charges. These key themes of investment and charges have received significant attention from the IGC over the year.
Peter Dorward, chairman of the IGC, commented:
“We’ve worked closely with Royal London to review their approach to Investment Pathways, their ESG policies and the delivery of the new charge disclosure requirements. Importantly we have also been able to agree improvements in these areas too. A group of customers will see their charges reduced because of this work and customers in certain older investment defaults will be offered alternative investments.”
He added: “We believe this will improve the value for money for the affected customers and will improve the governance of workplace customer investments. It is important to ensure good governance particularly in such a turbulent year. Royal London’s investment performance was slightly behind benchmark in 2020 but we believe the investment strategy is well considered and can deliver good returns for workplace customers for an appropriate level of risk.”
Responding to the findings of the report, Jamie Jenkins, Policy and External Affairs director at Royal London, said:
“It was an important year for Royal London and the IGC with the launch of Investment Pathways, significant developments in ESG and new charge disclosure requirements. This was on top of the significant challenges the pandemic caused for our customers and our people. As a mutual organisation, it is really important to us that we continue to provide good service and support in these difficult times. We were pleased to see that the IGC believe we did this well. We appreciate the valuable challenge the IGC provides, and the focus it brings on our customers, particularly when there is so much change.”
View a copy of the IGC’s report.