Stockholm (NordSIP) – Sweden Finance Minister Per Bolund has hit out at controversial investments worth billions of kronor in U.S. pipeline companies by state pension funds AP 1, 2, 3 and 4, which are at odds with a new law tightening sustainability requirements.
“I think it’s offensive. We who save for pensions should expect the AP funds to shoulder a large responsibility for sustainable development,” Bolund told Swedish business daily Dagens Industri. “Climate research being conducted makes it quite clear that this type of investment does not comply with the international climate agreements we have undertaken in Sweden.”
The pipeline companies are accused of massive emissions and circumventing environmental regulations as well as employing brutal methods to suppress protesting locals, suggesting at least one of them is the Dakota Access pipeline between North and South Dakota that threatens the Sioux Tribe Reserve. The pipelines are also linked to the extraction of oil sands, which are listed amongst the fossil industry’s greatest threats to the climate and local ecosystems.
The investments by the AP funds, which were revealed last week, amount to SEK 1.8 billion. “Unbelievable,” commented Nordea’s chief of sustainable investment Sasja Beslik. Nordea dumped its investments in the pipelines in early 2017.
The Swedish government issued a bill in June that would tighten management rules for the AP funds, first and foremost on sustainability, to take effect at the beginning of next year.
According to Bolund, the new rules mean that “it will not be possible to invest in the dirtiest forms of energy production, such as oil sands, which are completely unreasonable from a climate point of view.”
Asked whether the holdings actually allow the AP funds to influence companies from within, Bolund said: “Dialogue is an important tool for impact. But one must also be able to make the most of the threat and leave. When it comes to building new pipelines for often the most dirt fossil fuels like oil sand, simply do not use sustainability as a front!”
“We will not determine exactly what investments the AP funds will make [through the new regulation]. However, we have set the framework and it is now extremely clear. Only exemplary and responsible management applies. If funds won’t understand this, we can appoint and review who will be responsible for management decisions.”
Ossian Ekhdal, chief of ESG at AP1, told DI last week that it has sold its holdings in one of the companies and is pursuing dialogue with the others.
Image: (c) Elti Meshau-Pexels