AkademikerPension Excludes China


Stockholm (NordSIP) – One of the simplest first steps for investors venturing into sustainable practices is to apply exclusions to their portfolios, whereby specific controversial sectors, companies or practices are blacklisted. Companies investing in oil sands, thermal coal or violating human rights are generally an easy first step on the journey towards sustainable investing. Exclusions have the benefit of being simple to implement and to explain.

Now, AkademikerPension, a Danish pension fund catering to Danish postgraduates employed at universities and upper secondary schools, has taken exclusions to the next level and announced the exclusion of China from its investment universe. The decision was supported unanimously by the board. According to the pension fund, the decision will affect DKK400 million worth of government bonds and shares, which must now be sold off.

- Promotion -

In the past, AkademikerPension (under the name MP Pension) has excluded a large number of countries such as Saudi Arabia, Thailand and Iran. The addition of China, the largest emerging market economy in the world, however, is a decision on another scale. “We have long had China under observation. It is well known that the country systematically violates human rights, and we can no longer turn a blind eye to it,” said Jens Munch Holst, director of AkademikerPension.

It appears that Beijing’s recent crackdown on protestors in Hong Kong and the extension of China’s security law onto the island tipped the scales against China. However, AkademikerPension also noted the treatment of the Uighurs, the general persecution of minorities and political opponents and the use of the death penalty as motivations for this decision.

“Our ambition in AkademikerPension is to sharpen the profile when it comes to accountability. Our motto is that return and accountability must go hand in hand. When we talk about accountability, it is difficult to argue that we should keep China in our portfolio”, Holst added. “Our most important task in AkademikerPension is to ensure that our members get good pensions to live on when they need it. But we also take on social responsibility, and that is in the context that our divestment of China must be seen”, Holst concludes.

Image by Sharon Ang from Pixabay

Partner message

The coronavirus epidemic has further accelerated the rise of ESG into the investment mainstream. As deficits skyrocket, bond investors have an opportunity to engage with governments on climate change, argues Thomas Dillon, Senior Macro ESG Analyst at Aviva Investors.

Learn more

NordSIP Insights

Most read this week

AP Funds Invest In Northvolt

Stockholm (NordSIP) - According to a joint announcement by the Swedish National Pension (AP) Funds, 4 to 1 Investments KB, a company jointly owned by...
Photo by Daniel Moqvist on Unsplash

CO2, a One-Way Bet?