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Denmark to draft scheme inspired by UK’s Stewardship Code

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The Danish government is set to draft a code, based on the UK Stewardship Code, to steer the country’s pension providers towards more proactive engagement with company management.

Troels Lund Poulsen, minister for business and growth, said the proposed code would ensure a focus on healthy, long-term corporate activity.

“It benefits Danish competitiveness if institutional investors use their influence and skills to help Danish companies operate in the best possible way,” he said.

Lund Poulsen said he had asked the Committee on Corporate Governance (Komitéen for god Selskabsledelse) to draft a set of recommendations that could strengthen active ownership.

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“It will be both to the advantage of investors and businesses, if, for example, pension funds show a more visible engagement with those businesses they invest in,” he noted.

At the same time, the ministry said it had decided to boost the number of people on the committee by up to two new members who had relevant investment experience, so that the panel had a sufficient level of investment skills to carry out the new work. 

At the moment, the committee has seven members including Dorrit Vanglo, the chief executive of pension fund LD.

It had not yet been decided who would fill these new posts, the ministry said.

It praised the UK’s Stewardship Code, which was launched in 2010, saying it had contributed to raising the level of engagement among institutional investors in connection with their investments in British companies.

Last December, the Financial Reporting Council (FRC) said it would soon begin assessing and rating pension funds and asset managers on their level of engagement with the Stewardship Code.

The International Corporate Governance Network (ICGN) said late last year that it was drafting a global stewardship code building on similar initiatives in Japan and the UK.

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