Danish mutual pensions provider AP Pension is launching a new product designed to allow savers to contribute to the green energy transition and the UN’s Sustainable Development Goals (SDGs).
The DKK115bn (€15.4bn) provider said all bonds in the new AP Sustainable product would be green bonds, while its equities portfolio – managed by BankInvest – would comprise only companies generating at least 60% of turnover from activities associated with one or more of the SDGs. This figure compared to 10% in a general global investment fund, AP Pension said.
Ralf Magnusson, CIO of AP Pension, said: “With AP Sustainable, we invest… in sustainable companies and foundations. We make choices, sort out and select investments that have particular concern for the world we live in.
“And we are focusing even more on reducing CO2 emissions and making investments in, among other things, wind turbines, solar cells and sustainable construction.”
The fund said it had entered into a collaboration with fintech company Matter, which would enable customers to see the environmental impact of the new fund via Matter’s digital platform.
AP Pension said Matter had also helped develop the sustainability criteria for various asset classes in AP Sustainable, including its allocations to forestry, real estate and renewable energy as well as the bond and equity portfolios.
The provider said the carbon footprint from the equities portion of the sustainable pension product would be 50% less than that of a normal equities portfolio. The product would also focus on investment in alternatives that support the goals of the Paris agreement, including certified sustainable forestry.
Magnusson said that, while AP Sustainable had a blacklist of companies in which it would not invest, the difference between AP Sustainable and other AP Pension products lay in its positive investment decisions.
New AP Pension staff would automatically have 25% of their pension invested in AP Sustainable, the company said.