AP Pension in Denmark is to divest DKK310m (€41.6m) of stocks as a result of tightening its fossil fuels divestment criteria, with European energy giants TotalEnergies and Shell among the 73 companies being newly blacklisted.
Anna Maria Fibla Møller, head of responsible investments at AP Pension, said: “As a result of our new and tighter criteria, we are divesting oil and gas companies that invest in new oil and gas fields and that have not drawn up ambitious business plans to realign themselves in accordance with the objectives of the Paris Agreement.”
The Copenhagen-based pension provider said the stricter rules it put in place this month for the exclusion of fossil fuel investments from its portfolio related to coal, utilities, tar sands and oil and gas business.
“The tightening takes place as part of AP Pension’s climate strategy, where the company has a stated goal that all investments in 2050 must be climate neutral,” it said.
AP Pension said that after the 73 new exclusions, there were now 187 fossil fuel companies on its investment blacklist.
One of the new blacklistings was Shell, it said, in which AP Pension had DKK91m invested, and TotalEnergies was also being banned.
“In total, with the new stricter exclusion criteria, AP Pension will sell investments in eight fossil fuel companies for approximately DKK310m,” it said, adding that these divestments would take place during the first quarter of this year and included both shares and corporate bonds.
Under the new criteria, AP Pension says it will divest stocks which have more than 20% of their turnover linked to extraction of oil and gas.
Fibla Møller said that how to best handle oil and gas companies that invested in new oil and gas fields was a dilemma for AP Pension.
“On the one hand, these companies have a large negative impact on the climate, but on the other hand, we are willing to invest in those companies that have a credible plan to transform their business so that it is compatible with the Paris Agreement,” she said.
She cited Italy’s Eni as an example, which AP Pension had put on its watch list, and was monitoring closely – but around which it was also increasing its active ownership efforts.
“We have a responsibility as an active owner to push the companies we have in the portfolio in the right direction,” Fibla Møller said.
“We cannot have an ambition for our investments to be climate neutral if we are not prepared to make demands on the companies we invest in,” she said.
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