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New pension rule will favour brownfield investments


INVESTMENT IN brownfield development is set to benefit from new government measures forcing pension funds to demonstrate environmental, social and ethical accountability.

Under the directive launched last week, occupational scheme trustees will be required to state their investment policy alongside financial results. A greater number of 'responsible' investments is expected to be required to create balance in portfolios.

And because pension funds invest heavily in the property and development markets it is likely brownfield schemes will win favour, said Ethical Investment Research Services head of client services Karen Eldridge.

Announcement of the audit by pensions minister Stephen Timms followed the recommitment last week by the Department of the Environment Transport and the Regions' Urban Task Force to build 60% of new houses on brownfield land. It recommended that all of the UK's brownfield sites be rehabilitated within the next 30 years.

The audit, which takes effect in July next year, is an annex to the Government's existing Statement of Investment Principles, introduced two years ago to improve transparency in the investment sector. Companies must detail types of investment and the balance between investments, risk, return and realisation.

(see feature page 16)

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