Pensioenfonds Huisartsen, the occupational pension fund for general practitioners (GPs) in the Netherlands, has published the names of the 65 companies included in its new concentrated equity portfolio. Almost half of the new portfolio consists of firms in the healthcare and information technology sectors. Europe is best represented in the new portfolio.
Last December, the GP fund announced that it would switch to a concentrated equity portfolio with about 70 companies, a controversial decision that was met with criticism from pension fund executives and academics, among others.
In an article on its website, the fund has now announced the companies it has selected. Pharmaceuticals, such as Denmark’s Novo Nordisk, and information technology companies like Microsoft and Nvidia (the only two representatives of the Magnificent Seven, the seven largest American technology companies) are proving particularly popular. Together, these sectors account for almost half of the selected firms.
European firms outnumber American ones
Upon announcing the strategy change last month, the GP fund said it wanted to invest less in the US, which by then accounted for two-thirds of the scheme’s equity investments. The fund does not say how much it has now invested in US-listed companies. Neither does it say how much it has invested in each of the 65 companies. The fund also declined to reveal the name of the asset manager that has selected the stocks and will manage the new portfolio.
It is clear, however, that Europe is better represented in the portfolio than the US, at least in terms of the number of companies. Additionally, three are Japan-based, with two from Australia. The representation of emerging markets is limited, with only five companies. These include three banks and/or insurers, the Hong Kong stock exchange and chip manufacturer TSMC from Taiwan.
ABB and Unilever
When selecting the companies, the asset manager of the GP fund had to take into account the (negative) impact of those companies on the environment and society in addition to financial aspects. The pension fund has written a short note for each of the companies in the portfolio explaining why they have been selected. For the Swiss company ABB, a manufacturer of low-voltage electrical equipment and automation solutions, for instance, the fund writes that ABB’s products help improve energy efficiency and thus contribute to reducing greenhouse gas emissions.
However, this link is not equally clear for all companies. An example of this category is Unilever, which received criticism in the wake of its CEO Hein Schumacher’s decision last April to scale back some of its environmental and social aims. According to the GP fund, however, Unilever has “a neutral profile with regard to social themes”.
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