Updated 11/11 with answers from the City of Aarhus.
Updated 10/12. An earlier version stated that Ingosstrakh keeps the shadow fleet sailing. This has been clarified to Ingosstrakh helping to keep parts of the shadow fleet sailing according to several experts.
Millions of Danish tax kroner and pension funds can be linked to Putin’s dark fleet, which is suspected of being the crown jewel in Russia’s circumvention of Western sanctions.
The country’s municipalities and pension funds have invested DKK 13 and 413 million respectively in the Italian insurance company Generali, which owns 38.5 percent of the Russian insurance company Ingosstrakh, which Danwatch has previously revealed keeping part of the dark fleet sailing, according to several experts. The company is so controversial that it has been sanctioned by the UK.
As Danwatch has previously documented, the dark fleet consists of old oil tankers that are considered a serious environmental risk by experts – especially in Danish waters – and they operate on the edge of sanctions.
The money thus plays a role in the economic cycle that keeps Russia’s income from black gold afloat. And it is by far the most important export area for the Russian economy, says Flemming Splidsboel, Senior Researcher on Russia at the Danish Institute for International Studies.
“The crucial factor for the Russian economy is oil exports. That’s what keeps them going at the level they are at now. That’s where you have to take action if you want to fix it,” he tells Danwatch.
A circuit in which the dark fleet is a vital part of getting Russian oil distributed – and Ingosstrakh is a vital part of ensuring that part of the dark fleet’s vessels can travel at sea at all. After Russia’s full-scale invasion of Ukraine, Western insurance companies largely withdrew from the Russian maritime market, which is why Ingosstrakh is now a vital player in the field of essential insurance.
“Ingosstrakh keeps the dark fleet afloat. And thus Generali also contributes to it, even though they are not the decisive party in the problem. But it is problematic in many ways. If you really wanted to put pressure on the Russian economy, it would have to be hit on oil – and this is also a reason for various institutions and companies to look at whether they play a role in it,” says Flemming Splidsboel.
Frozen investment
Ingosstrakh told Newsweek that Generali has the undisputed largest shareholding in the company with 38.5 percent, while the rest is owned by Russian companies and citizens.
However, since March 2022, they have chosen to freeze the investment and have resigned from Ingosstrakh’s board. Thus, they claim that they have no influence in the company, even though they retain the investment.
“In accordance with all applicable sanctions, in March 2022 Generali resigned from the Board of Ingosstrakh. Since then, the 38.5 percent investment in Ingosstrakh has been frozen, which is why Generali does not carry out any activities related to it,” Generali writes in a written response.
In addition, they did not want to answer why they maintain their ownership stake in Ingosstrakh.
Pension funds are holding on
The three pension funds with the largest investments in Generali are Sampension, PenSam and PKA.
Sampension has shares worth DKK 300 million in Generali, while PenSam and PKA own shares worth DKK 89 and 24 million respectively in the company.
Following Danwatch’s inquiry, PenSam stated that they would now investigate the matter further as they “obviously do not support the dark fleet and the circumvention of sanctions”.
However, the investigation has not given reason to sell out of the shares.
“We have investigated the matter through our partner Sustainalytics, and we have found no evidence that Generali has violated any sanctions. Nor are there any ongoing investigations of the company by the authorities regarding Generali’s investments in or relations with Ingosstrakh. Should the situation change, we will of course reassess our investments in the company, which currently amount to DKK 89 million, in accordance with our responsible investment policy,” writes Head of Communications Camilla Woergaard.
Sampension and PKA are also holding on to the companies’ investments, but state that they are actively following the case.
Danish taxpayers’ money in the dark fleet
In addition to the pension funds, the country’s municipalities have invested a total of DKK 13 million in Generali, according to Danwatch and Gravercentret’s database of municipal investments in securities.
Among those who have invested the most money in the company are the municipalities of Aarhus, Odense and Ringkøbing-Skjern. But neither Odense nor Ringkøbing-Skjern intend to weed out the investments.
“Following Russia’s invasion of Ukraine in February 2022, Generali has chosen to close their office in Moscow and has also chosen to resign from their position on the board of the Russian insurance company, thereby freezing their investment,” says Hans Østergaard (V), Mayor of Ringkøbing-Skjern.
Based on Danwatch’s inquiry, Odense Municipality asked their asset manager to investigate whether the investment is in conflict with the municipality’s investment policy.
“It is the assessment of the asset managers that Generali does not violate the investment policy. As a result of the Russian invasion, Generali has taken several actions to manage its involvement in Ingosstrakh. Generali has closed its Russian representative office and stepped down from the board of Ingosstrakh, thereby losing any influence in the company as a result of Russia’s invasion of Ukraine on 24 February 2022,” says Poul Aggerholm, Head of Office in the Mayor Administration.
In a written response, Aarhus Municipality states that they have asked their four asset managers to divest their shares in Generali based on the inquiry.
