A Dutch pension fund has asked 50 of its members to help shape its approach to sustainable finance, as part of a new model it calls ‘deelnemersdialoog’, or ‘member dialogue’.
Pensioenfonds Detailhandel, the approximately €30bn pension fund for retail workers in the Netherlands, conducted a three-day workshop to develop recommendations for the next iteration of its responsible investment policy.
The results of the process, conducted in February and March, have now been published.
“By bringing together a representative group of members, the ‘deelnemersdialoog’ provides Pensioenfonds Detailhandel with an unparalleled in-depth picture of their members’ perspectives on the future, their values, and on their collective recommendations of responsible investing,” the fund said in an English translation of the findings, published last week.
The project responds to a growing challenge for pension funds, which are struggling to establish a clear mandate for pursuing sustainable and ethical investing.
Pushback against incorporating ESG considerations into investment decisions has increased in recent years, especially in the US, with some asset owners and managers being accused of shoehorning ‘woke’ ideological agendas into financial decision-making.
As a consequence, many feel a need to demonstrate that their responsible investment and sustainability policies reflect the values and needs of their clients and beneficiaries.
Pensioenfonds Detailhandel identified 50 of its beneficiaries, which it refers to as “dialogue-makers”, from across regions, ages, genders and political beliefs – including members who had stopped paying into the fund.
They were convened and taught about pensions and sustainability by experts from Pensioenfonds Detailhandel, as well as academics from the Netherlands and elsewhere, and Mart Keuning, a responsible investment specialist from ABP pension fund.
The fund described having “provided dialogue-makers with an introduction to [its] responsible investing policy, and the types of trade-offs involved”.
The 50 members were then asked to discuss their “hopes and aspirations for the world in 2034”, explained Pensioenfonds Detailhandel. The research showed that 15 issues were highlighted by members most frequently.
“These focal themes were: peace, war and weapons; immigration and emigration; climate; quality of life and environment; technology; families and caring; intergenerational issues; justice, equality and poverty; consumption patterns; housing; togetherness and loneliness; action, influence and power; and sustainability.”
The most highly-prioritised issue for the members was sustainability, followed by impact and long-term investing, working conditions globally, and the housing market. Financial returns came in fifth, ahead of topics such as human rights and the circular economy.
Off the back of the discussion, the members developed 49 recommendations, ranging from the environmental and social themes that the fund should prioritise in its investment decision-making, through to how long shareholder engagement programmes should last and whether portfolio companies should be required to provide annual updates on their progress on sustainability challenges.
Finally, each member of the group was asked to vote on each recommendation, based on how strongly they agreed or disagreed that it should be brought into the fund’s future responsible investment policy.
“These recommendations will be considered, and addressed by the Pensioenfonds Detailhandel board, to inform future policy on responsible investing,”the fund said in its summary.
“The board will respond to the ‘deelnemersdialoog’ recommendations by September 2024, and will address them in their decision-making on responsible investing policy.”
Pensioenfonds Detailhandel runs its money externally, through asset managers including BlackRock. It has a contract with Columbia Threadneedle for “services that we think they can do better than BlackRock”, such as shareholder engagement and voting.
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