SEB IM Aims for 2040 Carbon Neutrality

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    Stockholm (NordSIP) – With the clock ticking on the Paris Agreement’s climate goals, fund managers need to step up their ambitions for sustainable investments. In the hope of doing its part for the transition, SEB Investment Management (SEB IM) announced several sustainability-related changes to its funds, including new exclusions for all funds as well as new models. The changes are part of a broader Sustainability policy update through which SEB IM hopes to make all its funds carbon neutral by 2040. SEB Investment Management’s announcement follows a similar decision by Nordea at the start of March.

    ”We now take another leap forward when it comes to future-proofing our funds based on our view of sustainable development and future return possibilities,” says Javiera Ragnartz (Pictured), Head of SEB Investment Management. “Our ambition is to invest in companies with long-term sustainable business models, while all funds will at the same time exclude fossil fuels.”

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    A New Sustainable Policy

    During the first quarter of 2021, SEB IM will implement an updated sustainability policy decided by its board in December 2020. The investment manager will apply exclusion rules (e.g.: fossil fuels, tobacco and commercial gaming operations) to all funds that were previously used only for sustainable and ethical funds. In parallel, exclusion criteria regarding fossil fuels is broadened and all funds will exclude extraction and production of fossil fuels as well as power generation and distribution connected to fossil fuels, unless there is a proven transition case. The exclusion of fossil fuel for all funds follows the implementation of stricter requirements regarding the exclusion of fossil fuels for index-tracking funds during 2020.

    At the same time, a brand new and own model is introduced to strengthen the analysis of all companies in the investment portfolio, with focus on material sustainability risks and opportunities.  The new model collects data reported by companies, third parties and SEB’s own analysis, captures sustainability risks and opportunities and allows for a proprietary scoring of each holding.

    In addition, a new climate strategy means, among other things, that the fund company’s total capital should be invested carbon neutral by 2040 and that investments in companies that contribute to solutions or enable transition shall increase.

    Following this change, words such as sustainable and sustainability will disappear from SEB IM funds’ names. ”When we now raise our ambitions and they will become the same for all funds, there is no longer a need to distinguish between sustainable funds and other funds,” Ragnartz explains.

    Joining the Net Zero Asset Manager’s Initiative

    In line with this renewed commitment, SEB IM also joined the Net Zero Asset Manager’s Initiative, whose members are committed to achieving net zero emissions by 2050.

    “For SEB Investment Management, addressing climate change and the huge challenge that it means for companies, people and the planet, is a strategic priority. We aim for assets under management to be net zero by 2040, and for this purpose, joining the Net Zero Asset Managers initiative is key. We look forward to collaborating with our peers and with investee companies in working towards the common goal of net zero,” Ragnartz comments.

    Image Courtesy of SEB

    Filipe Albuquerque
    Filipe Albuquerque
    Filipe is an economist with 8 years of experience in macroeconomic and financial analysis for the Economist Intelligence Unit, the UN World Institute for Development Economic Research, the Stockholm School of Economics and the School of Oriental and African Studies. Filipe holds a MSc in European Political Economy from the LSE and a MSc in Economics from the University of London, where he currently is a PhD candidate.
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