Denmark’s Industriens Pension has committed DKK1.5bn (€200m) to a sustainable equity fund run by Liechtenstein-based asset manager LGT.
The LGT Sustainable Equity Global fund focuses on companies that are financially strong and particularly sustainable, according to Industriens.
The DKK172bn labour-market pension fund said there was a large volume of data showing that companies focused on sustainability often had a long-term competitive advantage.
Peter Lindegaard, Industriens Pension’s head of listed investments, said: “It is our clear assessment that good returns and investments in sustainable companies often go hand in hand if they are managed by skilled managers.
“Therefore, we also expect attractive returns from our new investment at LGT.”
The pension fund said LGT used a variety of data sources to compare companies’ environmental impact, social responsibility and governance culture, and only invested in companies that scored highly in all three areas.
Industriens said that the burden its equity portfolio placed on the environment and climate was 20% lower than that of the global stock market in general.
Its investments in renewable energy and companies with green energy as their main business totalled DKK10bn.