The Nykredit investment policy has at its core support for international agreements as well as sustainability as a performance driver. The policy specifically mentions the Paris-agreement and has the ambition to keep the investments in line with the Paris-agreement.
The Nykredit view is very much in line with the TCFD-report. Nykredit has yet to do TCFD-compliant analysis of all of its portfolios. However Nykredit has gathered insights from various ESG-approaches to our different products.
Firstly as ESG is part of our approach specifically in our fundamental products we have identified how climate related KPI's affect risk and alpha in different ways. Naturally the market danymics still apply if for instanse a specific technology receives support or this ends. At Nykrediit we analyse the technologies advantage without subsidies.
Secondly in in managing our fossil free portfolios it is clear to us that the most seriously effected companies are not necessarily the direct producers, but rather the suppliers to these companies. It is also clear that many different sectors, regions and and even countries might be very seriously effected thorugh more indirect exposure.
Thirdly we recognize that eventhough the transition will happen long term the effects in valuation of stocks and fixed income might change seriously in the short term as consensus for the new reality builds. Thus the effects will not necessarily be integrated in the stock valuation gradually in a linear way, but could rather be step wise.