The fund has nine general investment principles . One of these principles is dedicated to ESG.
The pension fund invests in order to meet future pension payment liabilities. The investment portfolio is invested in a diversified way to mitigate risk and maximise returns. It is believed that ESG does not reduce investment returns and may reduce financial risks resulting from physical damage of transtioning to a fossil-free world.
The ESG policy of the fund has been extensively discussed with stakeholders before deciding on the final set-up of the policy; the policy has a 3 year term in which ambitions should be realized.
ESG considerations are integrally taken into account in the investment policy, both in determining the asset mix and on an individual level. ESG is implemented through a combination of exclusions (100% coverage), best-in-class (equities, credits and emerging market debt), voting (equities) and engagement activities (equities). Active (impact-like) strategies are considered in the private markets portfolio (most notably infrastructure).
The implementation of the ESG policy and its results are disclosed in the annual ESG report of the fund. A dedicated ESG report is also required from our property advisor and manager of private market investments.