How Länsförsäkringar Measures Carbon Footprint

    Stockholm (NordSIP) – Swedish mutual insurance giant Länsförsäkringar (LF) has recently published a comprehensive evaluation of its carbon footprint, as well as the results of their climate scenario analysis.

    The company had already published a similar report last year, but LF now goes beyond estimating the carbon footprint related to its equity portfolio. Government bonds, as well as SSAs and the firm’s direct ownership of timberland, are now also part of the estimate.

    The results are presented relative to the value of the overall position, and compared to a benchmark. According to the report, listed equities (scope 1-2) represent 22-25 tons CO2e/SEKm (30% better than the global index), while SSA bonds weigh in at 17-32 tons CO2e/SEKm (up to 60% better than the EU 28 benchmark).

    The insurance company’s timberland assets, Bergvik Skog, represent emissions of 0.2 tons CO2e/SEKm of sales, however, the report estimates that the carbon capture of timberland comes to a negative 631 tons CO2e/SEKm. According to the report, this effect offsets about 80% of the emissions generated by listed equity holdings.

    In addition to the positive effect from forest land, LF also considers the positive carbon-avoidance and offsetting effect of its green bond portfolio which has increased dramatically over the past year and amounts to about SEK5.7 billion (about €530m).

    Image by Valentin Sabau from Pixabay

    Aline Reichenberg Gustafsson, CFA
    Aline Reichenberg Gustafsson, CFA
    Aline Reichenberg Gustafsson, CFA is Editor-in-Chief for NordSIP and Managing Director for Big Green Tree Media. She has 18 years of experience in the asset management industry in Stockholm, London and Geneva, including as a long/short equity hedge fund portfolio manager, and buy-side analyst, but also as CFO and COO in several asset management firms. Aline holds an MBA from Harvard Business School and a License in Economic Sciences from the University of Geneva.

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