Corporate responsibility statement
Introduction
NEST is a brand new workplace pension scheme, well on its way to becoming one of Britain’s biggest. It was set up to
facilitate automatic enrolment by ensuring that every employer subject to the new workplace pension duties would
have access to a well-run, low-cost pension scheme which they could use to meet those duties.
NEST Corporation, the trustee of the NEST scheme, was established in 2010 by the Pensions Act 2008. As a public
body acting as the trustee of a pension scheme, NEST Corporation is unique in the world of pensions.
NEST Corporation is made up of a number of members – who we call trustee members – currently appointed by the
Secretary of State for Work and Pensions. These trustee members, acting together as NEST Corporation, run the
NEST scheme.
We exercise powers given to us as a public body and are subject to public law duties and legislation that applies to
public bodies such as the Freedom of Information Act.
We also exercise our duties and powers as the trustee, and are subject to trust law duties too. One of our (unique)
duties as a trustee is our public service obligation to accept all employers who want to use NEST to meet their
employer duties.
Our sponsoring department is the DWP and our relationship with them is governed by a Memorandum of
Understanding and a Framework Agreement. We operate at arm’s length from government but are accountable to
Parliament through the Minister of State for Pensions.
The initial funding for NEST has been provided by the government in the form of a loan. NEST Corporation runs the
scheme on a not-for-profit basis, for the public policy purposes mentioned above. Member charges will be used to pay
back the loan over time so that NEST ultimately becomes self-financing.
Our public sector status, and creation as part of a public policy initiative, taken together with our primary function to
act as the trustee of the NEST pension scheme, the fiduciary and other duties that entails, means we have taken our
corporate responsibilities very seriously. We exercise our corporate responsibilities in creating and operating the NEST
pension scheme in building the organisation that is NEST Corporation, and in the distinct values that drive everything
we do.
This statement sets out our aspirations for how we discharge our corporate responsibility. This applies to NEST Corporation
as an organisation, and our workforce. But, given the likely future size of the NEST pension scheme, NEST Corporation’s
corporate responsibility will be exercised most significantly in relation to the investment of NEST pension scheme funds. In
acting as trustee of NEST, investing and managing members’ contributions, and the contributions of their employers, NEST
Corporation will be a significant institutional investor and owner of shares and other assets. As NEST continues to grow, our
corporate responsibility approach with regard to investment will have to evolve and develop.
NEST Corporation is committed to mapping our impact and reporting on how we are carrying out our responsibilities to
NEST members, our stakeholders, our workforce, and wider society.
Corporate Responsibility statement
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Role and purpose
NEST’s role is to help millions of people to save confidently for their retirement
Investment
As the trustee of NEST, NEST Corporation’s corporate responsibility objectives go hand in hand with our investment beliefs.
NEST’s prime purpose is to deliver a retirement income to our members by investing their savings in ways that both
encourage and capture the benefits of sustainable economic growth. NEST members depend on a healthy economy to
provide them with work and wages during their working lives and a pension income in retirement.
NEST Corporation invests responsibly in ways designed to achieve good returns and consistent outcomes that are in line
with the needs and attitudes of our members. We seek to be among the best in the industry in our approach to
investment practices.
NEST Corporation continues to think through its approach from first principles and by aligning the interests of our
suppliers and stakeholders with our members. We only enter into arrangements based on fair commercial value for
suppliers. We wish to build sustainable and equitable partnerships. We are not afraid of rejecting the conventional
wisdom or the status quo. We may question or reject conventional wisdom or the status quo if an alternative better
aligns with our objectives.
We are a universal and long–term asset owner. It is therefore in our members’ interest for NEST Corporation to support
sustainable corporate growth, efficient markets and long-term thinking.
NEST is committed to investing in a way that aims to enhance long-term value and reduces investment risk. We believe
– and the evidence supports this belief - that responsible, well-run companies and projects offer better long-term value
to investors. Environmental, social and governance (ESG) factors are therefore essential to building and managing our
investment portfolios.
NEST Corporation’s formal Investment Beliefs and Statement of Investment Principles commits us to manage the
scheme’s assets responsibly. It has been prepared in accordance with all relevant legislative and best-practice guidelines.
It outlines the principles and policies governing investment decisions made by or on behalf of NEST Corporation for the
management of NEST’s assets. It will be reviewed by NEST Corporation every year and without delay after any
significant change in the investment approach.
For further explanation, see this year’s statement in full here: nestpensions.org.uk/schemeweb/NestWeb/includes/
public/docs/statement-of-investment-principles,PDF.pdf
Values and behaviours
NEST is run in the interests of our members. We do this by championing our brand values of transparency, ease and
empowerment. As an organisation, the NEST Code of Conduct sets out our organisational standards and the ethical
principles that all our employees are required to uphold.
NEST Corporation’s public service obligation means we accept any employer who wants to use NEST to meet their
employer duties.
We seek to be among the best in the industry in the way we act responsibly with our suppliers throughout the
organisation. Already we have had a positive impact on automatic enrolment pensions on issues such as charges,
governance and investment strategy.
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Governance
NEST Corporation’s trustee members are committed to the highest standards of corporate governance. They set the
strategic direction and objectives for NEST Corporation. They have a number of legal duties, including the fiduciary duty
to run NEST in the interests of its members. Trustee members follow a code of conduct. They are supported by an
executive team and a chief executive to whom they delegate a number of functions. The chief executive is also the
accountable officer of NEST as a public body. The trustee members are advised by NEST’s Members’ Panel and
Employers’ Panel.
Partners and suppliers
The administration of NEST is a largely outsourced business. This makes our suppliers key partners in the successful
delivery of all aspects of the pension scheme. Our largest supplier, Tata Consultancy Services, has played an important
part in the success of NEST to date and we look to build on this with all our suppliers in future. We believe that we have
a responsibility to all our suppliers to support their viability over the term of any contract we have with them, just as we
aim to ensure that the interests of our members drive their business behaviour.
People
Our aim is to have a fully engaged workforce that understand their role and the contribution to NEST Corporation’s
objectives. We want our staff to have opportunities for personal and career development, to be remunerated fairly, and
to be empowered within a set of accessible and understood policies, procedures and behaviours.
We carry out an annual staff survey which we benchmark against some of the UK’s best developed companies and
organisations to test the level of engagement. The results of this survey are shared with all staff, and discussed within
each directorate. We are building NEST Corporation’s corporate culture and behaviours through a number of initiatives
including education and development, a staff code and a new performance management system that assesses both
achievement and behaviour.
NEST Members
To serve NEST members we need to understand their interests as closely as we can. We carry out comprehensive
research to ensure that we know our members and potential members. We have developed an ethical code for
conducting any live research that we carry out among members. We also consult our members’ panel on significant
issues that affect members.
Employers and their advisers
We work to make NEST’s systems as accessible and as easy to use as possible for employers and their advisers and
agents. We consult our Employers’ Panel on significant issues that affect employers.
Environment
NEST Corporation is committed to meeting its environmental responsibilities and to reporting them using the same
principles as the Greening Government Commitments (GGC). In November 2013 we moved into new offices in a
building shared with other government sponsored organisations. As part of the government estate, managed by
government contractors, our new offices already have an action plan for reducing its carbon footprint in line with the
GGC. NEST Corporation, as a tenant, will contribute to this action plan and we will report on our progress. For further
explanation please find details on the government website: sd.defra.gov.uk/gov/green-government/
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Role in the community
NEST Corporation encourages employees to play a full part in our local community and to work with supplier
organisations such as Tata Consultancy Services in social action projects. This allows staff to experience different
working environments and to help other ventures. NEST Corporation gives all employees the option to take part in
community days and charitable events throughout the year. In turn NEST Corporation, as a small corporate
organisation, gets a benefit from the wider experiences gained through volunteer opportunities.
Reporting
It is important for NEST Corporation to be able to measure the goals that we set ourselves as an organisation around
corporate responsibility. NEST Corporation completed the Business in the Community Responsible Business Check Up on
10 April 2015. This is a benchmarking and gap analysis assessment tool, designed for small companies. The purpose of
which is to identify gaps in our corporate responsibility approach and benchmark NEST Corporation against similar
companies both in terms of size and sector.
Future
NEST Corporation has a strong commitment to the corporate responsibility principles that we have set out here, and
we’re in the process of putting them into practice across everything we do. We recognise that we still have much to do
as we make the journey from a start-up to a mature organisation, but we believe we’ve made a sound start and are
making steady progress.
Contact us
National Employment Savings Trust Corporation,
Riverside House,
2a Southwark Bridge Road,
London, SE1 9HA
nestpensions.org.uk
© NEST Corporation 2014. All rights reserved. This information doesn’t constitute financial, investment or professional advice and shouldn’t be relied on. Any form of reproduction
of all or any part of this document is not allowed.
NC181 CRS 04/14