The leaders of two Danish pension funds have voiced their support for taking a firm stance on unfair tax practices, in response to a new survey which shows rapid growth in the number of the country’s pension funds and companies now explicitly shunning tax avoidance behaviour.
A report on responsible corporate taxation in Denmark by Oxfam IBIS, the Danish arm of the charity Oxfam, said 24 out of the 28 companies and pension funds it surveyed – including PFA, PenSam, P+, Novo Nordisk, Ørsted and Vestas – now had a policy on responsible tax behaviour, while in 2014 this could only be said for five of the organisations.
Søren Kolbye Sørensen, chief executive officer of Danish pension fund P+, said: “Responsible tax applies to all of us because it is the foundation for us continuing to finance the Danish welfare society.”
He said P+ wanted to help promote responsible tax practices, and that tax evasion and aggressive tax planning undermined an appropriate distribution of wealth as well as the intentions of the pension fund’s responsible investment policy.
Torsten Fels, CEO of Denmark’s PenSam, said proper tax payment was the basis for providing good public service to citizens: “At PenSam, it is therefore particularly important to us that our members’ pensions grow responsibly, and proper tax payment is therefore a key area in our work with responsible investments.”
The head of Oxfam IBIS said the organisation had been an “uncompromising critic” of tax havens and corporate tax “tricks” for over a decade, and had recently been highlighting the issue of companies based in tax havens applying for pandemic-related financial support.
Kristian Weise, the charity’s secretary general, said: “For many years, we have also been in dialogue with the private sector and the collaboration to create a common starting point for a talk about responsible tax.
“A lot has happened in the last few years and we can see that both the agenda and the companies have moved,” he added.
The organisation said its survey, published last week, showed that more than half of the 28 companies involved were more open about their tax practices than required by law – a change from 2015 when none had voluntarily published additional information about their tax affairs.
Pension funds were becoming more active as shareholders, Oxfam IBIS said, adding that they were pushing firms they invested in to be more open about their tax practices and policies.
According to the report six of 13 pension funds had entered into dialogue with firms on responsible tax, and four of the 13 had actually blacklisted firms due to concerns about tax.
Earlier this month, the European Council announced it was removing the Cayman Islands from the EU list of non-cooperative jurisdictions for tax purposes – known as its tax haven blacklist – after the British overseas territory adopted new reforms to its framework on collective investment funds.
Back in February when the Cayman Islands was originally added to the blacklist, some major Nordic investors including ATP and PFA said they would not invest via the jurisdiction because of that.