Dutch civil service pension fund ABP is considering axing companies from its portfolio, to focus its investments on those that are making a tangible effort to become climate neutral.

ABP, the largest Dutch pension fund with around €500bn (438bn) of assets, could see the number of companies in its portfolio cut by half, according to investment director Dominique Dijkhuis in an interview with Dutch financial daily FD, published today.

He told FD: “We need to take a hard look at which companies fit our new vision. Companies that can’t or don’t want to contribute to the transition are too risky for us. 

“We will invest in fewer companies and we will take bigger stakes in them.”

Dijkhuis did not specify which companies would no longer be eligible for ABP, nor how long the overhaul would take.

The fund said last year it would divest €15bn of fossil fuel investments, in a major turnaround. Only months before, it had said exiting fossil fuel investments would “not be the solution” to global warming.

Dijkhuis said ABP would demand that companies commit to be climate neutral by 2050, and would also set goals along the way that would become stricter with the years.

The financial sector will not be excluded from this policy, as it will have to target loans to sustainable investments, Dijkhuis added.

ABP’s own investments will also be geared towards sustainable projects, as the fund looks to directly invest in the building of offshore wind farms.

To read the digital edition of IPE’s latest magazine click here