Sweden’s AP7 announced it has added two large Chinese power companies to its blacklist on environmental grounds, with the pension fund’s latest round of semi-annual exclusions lengthening it total blacklist to 86 companies.
A spokesman for the SEK722.5bn (€71bn) national pension fund told IPE that before it divested them, AP7 did have a total of SEK31m invested across both companies – Huaneng Power International and Power Construction Corporation of China.
The two companies have market capitalisations of CNY56.4bn (€7.3bn) and CNY58.6bn yuan, respectively, according to data from the Financial Times.
AP7, which runs the default option in Sweden’s first-pillar defined-contribution premium pension system, said in a statement: “The aim of the blacklisting is to exert pressure on companies that violate international norms to change their conduct.”
Electric power producer Huaneng Power International has been excluded from the Swedish pension fund’s investment universe for acting against the targets of the Paris agreement by expanding its coal operations, according to the announcement.
Engineering construction company Power Construction Corporation of China, meanwhile, is being banned because of its involvement in the violation of environmental norms at the World Heritage site of the Selous Game Reserve in Tanzania, AP7 said.
AP7 said its blacklist was revised twice a year, in June and December, and that these latest two changes took effect from 16 June.
In December, the pension fund announced it was broadening its climate criteria for exclusion, pledging to blacklist all companies making new major investments in coal production and coal power, and dumped coal stocks worth SEK273m.