Finland’s occupational pensions lobby group TELA has published a new analysis on the extent to which occupational pension assets in Finland are invested responsibly, concluding that at least 96% have been invested in line with the UN’s Principles for Responsible Investment (PRI).
The Finnish pensions alliance also said that of the sector’s €255bn of investments, at least 87% fall within the scope of the Climate Action 100+ initiative, and 62% were covered by the Institutional Investors Group on Climate Change, while 49% were subject to the carbon-neutral goal for all investment assets set for 2035.
Kimmo Koivurinne, analyst at TELA, commented that by law, pension assets had to be invested profitably and securely, and “investments whose climate and environmental impacts are sustainable can therefore be seen as one aspect of that security.”
In addition, he said, the systematic consideration of responsibility factors in investment activities helped with the risk management of investments. “In other words, responsibility also brings short-term security,” the analyst said.
TELA said its analysis examined investment responsibility through international commitments, primarily the UN PRI, to which €245bn of the €255bn in assets managed by the Finnish occupational pension sector were committed, judging by figures from the end of 2021.
The lobby group said the other two methods of implementing responsible investment examined in its analysis were influencing investment targets and investor cooperation, and measuring and reporting on environmental impacts – which enabled investors to join forces to influence companies.
“By participating in joint initiatives of large institutional investors, such as the Climate Action 100+ project that originated in the Paris Agreement of 2015, authorised pension providers can influence the operations of large companies that have major environmental impacts,” Koivurinne said.
TELA said measuring and reporting environmental impacts were “the first steps required” to gain a picture of the state of corporate responsibility, adding that this encouraged companies to reduce their carbon footprint and other impacts, while also influencing the wider corporate world.
It said the two reporting commitments included in its review – CDP and the Task force on Climate Related Financial Disclosures (TCFD) – covered 60% and 96% of Finnish occupational pension assets, respectively.
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