Danish pension funds back government plan for equity transparency
ATP and Danica Pension have backed for a call from the Danish government and opposition parties to boost transparency in pension fund investments.
In November, the Danish government together with the Danish Peoples’ Party (Dansk Folkeparti) and the Social Liberal Party (Radikale Venstre) agreed a package of measures based on a proposal from the Entrepreneur Panel (Iværksætterpanelet).
Under the plan, which includes funding of DKK14.7bn (€2bn) over the next seven years and the launch of a new type of equity savings account for individuals, the politicians say they will attempt to form an agreement with pension providers and ATP.
This agreement will involve increased transparency for their investments, including an annual declaration of their equity holdings, divided up into Danish and foreign shares, as well as by size and sector.
“This will increase transparency in pension companies’ equity investments and make it possible to a greater degree for individual pension customers to choose companies, whose investment profile suits their preferences,” the government plan said.
At the same time, according to the agreement, this would increase incentives for pension companies to invest assets in Danish growth companies, if requested.
ATP, PensionDanmark and Danica already make details of their equity portfolios available to view on their websites.
ATP believed it was important to take on responsibility as a large investor, said Ole Buhl, head of environmental, social and governance at the provider.
“Along those lines, we are working on a voting record database where everyone will be able to look up ATP votings on different occasions,” Buhl said, adding that the pension fund expected the database to be up and running by next spring.
PFA Pension, Denmark’s second-largest commercial pension fund, also agreed with the initiative.
“We are fully in support of transparency in our equity investments, and we already disclose our equity holdings twice a year,” said Henrik Nøhr Poulsen, CIO for equities and alternatives.
Noting that the policymakers’ aim was in part to give pension clients more options when selecting a provider, Jesper Langmack, CIO for equities and alternatives at Danica Pension, said his company already offered customers the opportunity to invest their savings themselves, through its product Danica Select.
“This enables our clients to customise their portfolio any way they choose, subject only to some conditions concerning diversification of risk and liquidity,” he said. “All in all we are supportive of the initiative, as we already offer this to our clients.”
Through its investment in Dansk Vækstkapital, PensionDanmark had invested in many Danish startups and small companies, a spokesman for the DKK224bn labour market pension fund said.