SWEDEN – Four of Sweden’s six buffer funds have for the first time jointly agreed to tender for ethical and environmental analysis and advice.

The SEK187.3bn (€20.2bn) buffer fund Första AP-Fonden (AP1), the SEK190.6bn Second Swedish National Pension Fund (AP2), the SEK175.8bn Tredje AP-Fonden (AP3), and the SEK180.2bn Fourth Swedish National Pension Fund (AP4) have collectively issued a request for proposal.

“This is the first time we do this big tender together with the other AP funds. This is an area where we can find that this is something we can do in common,” an AP2 spokesperson told IPE.

“This is a typical question where we all sit in different offices and do the same thing. So this is a way of making it short and simple for all of us.”

Until now, some of the funds have used individual consultants on short-term contracts, such as AP2, which used International Investment Services (ISS).

According to the request for proposal, where such relationships exist, funds reserve the right to use these consultants even after the tender has been awarded.

The AP2 spokesperson told IPE: “We need to do this greater tender. It’s not possible to make it … short-term for all four of us.

“This is a typical question where we all sit in different offices and do the same thing. So this is a way of making it short and simple for all of us.”

The brief demands systematic monitoring of violations of international conventions, corporate analysis regarding ethical and environmental issues, and advice and support via dialogue with companies related to ethical and environmental issues.

The AP funds, which invest in Swedish and global portfolios containing over 5,000 securities, are committed to ethical and environmental considerations without compromising the overall goal of high investment returns.

Further to this, funds will require information on whether the candidates have signed up to the United Nations Environment Programme’s Principles for Responsible Investment.

Candidates will also have to provide details on which companies they provide analytical services for, and whether the same assessment method is used for companies in different parts of the world.

The schemes are due to sign a three-year contract for ethical and environmental analysis, including advice for Swedish and global asset management. Every fund will also be able to extend the agreement for one year.

The RFP stated: “The funds cannot guarantee any minimum volume of services needed and each fund will have different needs. To ensure the access to competence in every individual case, the funds intend to sign with one to five suppliers, according to what each fund considers appropriate in view of its needs”

The funds’ final selections will be based on, amongst others, the quality of the analysis, price for services, geographical proximity to the funds, and simplicity and flexibility.

According to the AP2 spokesperson, there is no set amount for the contract.

The closing date is September 8.