Half of the large Dutch pension funds have not defined specific action points on climate change, a survey by the Dutch association for investors in sustainable development (VBDO) has suggested.Of the 50 pension funds examined by the VBDO, 12% lacked an explicit policy against climate change, while 38% had only addressed the issue in general terms, the organisation found.It said that the other half had formulated action goals, often a reduction of their investment portfolio’s carbon footprint.Another step taken by pension funds was to reduce the financial risks of climate change in their portfolio – in particular the risk of loss of value of fossil fuel-related investments – by aligning them with the climate targets of the Paris Agreement. The organisation had focused on climate change for its latest annual survey because the subject posed the greatest ESG risk of the moment, said Angelique Laskewitz, VBDO’s director, during the presentation of the report earlier this month.The association emphasised that missing the target of keeping global warming to no more than two degrees above pre-industrial levels could have catastrophic consequences. VBDO found that one scheme had a policy in place to prepare investments for physical risks of climate change, such as damage to property and disruption of supply chains.It said that more than 20% of pension funds tried to actively contribute to climate solutions, for example through investment in renewable energy or green infrastructure protecting against extreme weather.PFZW drops to third in rankingThe €459bn civil service scheme ABP received the highest score in this year’s ranking, as last year. PFZW, the €238bn healthcare pension fund – which came second in the 2018 survey, and for 11 years before that top of the list – dropped to third place.BpfBouw, the €67bn pension fund for the construction sector, was ranked second in this year’s survey.Lucienne de Bakker, who contributed to the survey, said that the pension funds’ targets still fell short in terms of measurability and deadlines.No more than 32% had formulated a final date for targets, such as carbon reduction, she said.The organisation recommended pension funds to consult more with NGOs, academics, and other experts in order to keep their policy up to date. Middle and low achievers could look to the frontrunners to learn from them.It also advised schemes to improve their reporting to members on targets and results achieved.