Swedish pension fund AMF – a notable investor in unlisted climate-tech firms – has backed a call by industry organisations for the incoming right-wing government to foster more growth in the country’s fossil-free technology sector by making the continued reforms needed for this to happen.
The Nordic country is undergoing a major change in political direction following the 11 September general election which saw the far-right Sweden Democrats making big gains to become the second-largest parliamentary party behind the Social Democrats which held power until now.
Last Monday, Ulf Kristersson of the centre-right Moderate Party was confirmed as the new prime minister, leading a minority three-party government depending on support from the anti-immigration Sweden Democrats.
Tomas Flodén, AMF’s chief investment officer, referred to an opinion article from a group of trade organisations in Swedish newspaper DN, focusing on Swedish industry’s fossil-free technology success and the need for further reforms to maintain the prominent position he said the Nordic country and its industry had internationally.
“It is important for the climate, and for the long-term competitiveness of Swedish companies, Swedish jobs and Sweden’s economy and security,” he said, adding that climate policy was to a large extent economic policy.
“AMF is already today – like other Swedish pension companies such as Alecta and Folksam – a major investor in prominent Swedish companies that develop innovations and new technologies at that are at the forefront globally,” he said in a commentary published last week.
AMF alone managed more than SEK700bn (€63.2bn) and had great opportunities to continue investing in both new industries and companies, as well as the conversion of existing industries and development of necessary infrastructure, the CIO said.
“In total, the Swedish insurance and occupational pension companies manage almost SEK6trn – long-term capital that is ready to take risks at an early stage,” Flodén said.
He mentioned AMF’s investments in unlisted “rapidly-growing” Swedish climate-related companies such as Northvolt, Polarium, H2 Green Steel and Cake.
“We are also large and long-term shareholders in more well-established Swedish industrial companies with aggressive restructuring ambitions such as Sandvik, Essity and Volvo,” Flodén said.
He said Sweden had had the ability to cultivate talented entrepreneurs, the Swedish model with strong parties had enabled old industries to be phased out and new ones to be built, and that the country had managed to created “long-term rules of the game” – all of which had made it attractive to invest in Sweden and Swedish companies.
“The change that the Swedish industry is now facing is massive, even from a historical perspective,” he said.
“For this to take effect, as the industry organisations write, long-term rules of the game and broad political support are required,” the CIO said.
In the opinion piece in DN on 18 October, the leaders of 21 organisations such as the government-convened group Fossil-Free Sweden, the Swedish Gas Association and the Swedish Forest Industries Federation, said: “The incoming government has a great responsibility to ensure that the new green industrial revolution does not slow down”.
The associations laid out six priority areas for the new government, including the removal of barriers to all types of fossil-free energy; a reduction in the time that permit processes take; a dramatic increase in educational capacity, for example in battery engineering, and the adoption of a strategy for capturing, storing and using CO2 from the flue gases of industry and heating plants.
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