Previndai, the €15bn Italian industry-wide pension fund for company managers, has no plans to adjust its investment strategy in response to Europe’s growing focus on defence spending.
A spokesperson for the fund told IPE that “no changes to the strategic asset allocation are expected in relation to the announced European ‘rearmament’ plan”.
Previndai manages its sub-funds through a multi-year strategic asset allocation, which is reviewed on an annual basis.
With regard to defence-related investments, the fund applies exclusion criteria to controversial weapons. These are, therefore, not included in the portfolios, the spokesperson said.
A new law that came into force in Italy in February requires pension funds and asset managers to exclude companies – whether based in Italy or abroad – that directly or indirectly manufacture or sell anti-personnel mines, cluster munitions or submunitions.
To comply, Italian pension funds have introduced internal screening processes using public lists to identify restricted companies. These are then shared with asset managers to determine whether to hold or divest such assets.
Previndai’s stance contrasts with moves by several European peers that are increasingly viewing defence as a viable investment opportunity amid record levels of public expenditure.
Dutch civil service scheme ABP has allocated €2bn to defence-related companies, although it has not committed to further increases.
Meanwhile, Danish provider Danica Pension is revising its investment framework, reducing the number of exclusions to facilitate increased exposure to companies contributing to European defence and security supply chains.
The latest digital edition of IPE’s magazine is now available
No comments yet