23 Feb 2023

  • Financial Services

What if you could see the environmental impact of your pension?

Photo of a pile of coal showing the carbon footprint of a pension at retirement

What you invest your money in has a significant impact on the environment. I’ve created a quick prototype to illustrate how financial service firms could highlight this impact.

What you invest your money in has a significant impact on the environment.

According to Make My Money Matter, making your pension “green” is one of the biggest things you can do to protect the environment: it can cut 21x more carbon than giving up flying, going vegetarian and switching energy providers combined.

Choosing investments that are better for the environment is no simple feat. ESG investing (Environmental, Social and Governance) involves working with complex criteria and concepts, and making tough trade-offs.

But the first, more immediate challenge is awareness: How can you help people understand their impact, so that they want to do something about it?

Thinking about pensions, I think there’s several things financial services can do. And so I’ve made a prototype to demonstrate them:

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1. Pensions need to be interesting

If you want people to care about the environmental impact of pensions, pensions themselves first need to be more engaging – long, dry communications full of jargon won’t cut it.

The prototype steals the idea of a yearly round-up, à la Spotify, to create something more engaging and convenient than your standard annual statement.

A mocked up graphic of an iphone showing 'Your 2023 pension round up', similar to Spotify's tailored yearly round up of music
A Spotify-style yearly round-up for pensions

2. Pensions need to be understandable

People switch off when they don’t understand things. The basics of pensions need to be clear before layering on environmental concerns.

The prototype reduces content down to the essentials. It uses Plain English and images to make things easier to grasp.

A mocked up graphic showing an iphone saying 'Hi Louise, let's start with the basics... Money added to your pension this year: £7,300.11. That means the total value of your pension plan is now £10,964.08
Using Plain English and images to make pensions understandable

3. Environmental impact needs to be relatable

Environmental data can be baffling. For example, on a Black Rock fund sheet, they talk about “MSCI Weighted Average Carbon Intensity (Tons CO2E/$M SALES)”…

Carbon footprints (represented as the weight of Carbon Dioxide) are also abstract. It’s hard to imagine a gas weighing anything!

The prototype translates a pension’s carbon footprint from an abstract number into something more concrete – in this case, a pile of coal – making it easier to process.

A mocked up image of iphone saying 'CO2 emissions: This year: 14.7 tonnes. That's the same as burning a pile of coal 1.6m high and 4.3m wide' With the option to 'view in your space'
Making the carbon footprint of a pension more understandable

I use Augmented Reality, partly as a trick to create something more engaging, but mainly to make the impact even more concrete.

A pile of coal in the user's space, using augmented reality
Using Augmented Reality to show the carbon footprint of a pension

And when you see the pile of coal equivalent to the carbon emissions created by the time someone retires, it’s alarming.

Photo of a pile of coal showing the carbon footprint of a pension at retirement
The carbon footprint of a pension at retirement

There’s more to explore here. Are there other visualisations that are easier to make sense of? Or that makes it easier to compare with other activities e.g. driving, flying, heating your home?

4. Decision points need to be clear

If we inspire someone so that they want to make a change – brilliant. But that change has to be easy and well signposted. Most pension statements don’t make it obvious how to make changes. Instead, we should be designing for decision points.

The prototype has an explicit call to action: “Want to change the environmental impact of your pension?”. The decision point is clear.

Mocked up image of iphone saying 'Want to change the environmental impact of your pension? Change how your money is invested' with a graphic image of a green shoot growing
A clear decision point

As mentioned at the start, the next step is harder – how can you help people to navigate the different approaches to sustainable investing? But that’s for another prototype…

Learn more about What if you could see the environmental impact of your pension?

Stuart Tayler

Reach out to Stuart Tayler

Practice Director

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