One of Denmark’s largest pension funds does not wish to invest in companies that violate human rights or harm the climate. At least not officially.
Nevertheless, Danwatch can now reveal that Sampension invests in 59 companies that the pension fund has officially blacklisted.
A review of the pension fund’s investments shows that Sampension invests members’ money in the companies through external funds. The companies are excluded due to involvement in coal, tar sands, controversial arms or human rights violations.
Third largest in Denmark
- Sampension is Denmark’s third largest pension fund and manages almost DKK 270 billion.
- The company is owned by HK, Dansk Metal and Kommunernes Landsforening, among others.
It is criticised by experts and organisations. One of them is Andreas Rasche, Professor of Sustainable Finance:
“The excluded companies should not be part of the portfolio. Otherwise, the organisation violates its own principles and, in the long term, members will lose confidence in Sampension,” says Andreas Rasche, Professor of Sustainable Finance at Copenhagen Business School.
Unambitious climate targets and concealed investments
The companies that Sampension has officially blacklisted but nevertheless invests in include the oil giants ConocoPhillips and Totalenergies.
There are also a number of companies involved in nuclear weapons, such as Aerojet Rocketdyne Holding, which produces nuclear missile systems for the US and UK militaries. This was revealed by Danwatch’s review of Sampension’s stock lists compared to the pension fund’s own exclusion lists.
THE FACTS
Sampension’s investments in blacklisted companies
Here are the companies that Sampension invests in, even though they are also blacklisted. It has not been possible to obtain the amounts of the individual investments. “Reason for exclusion” is taken from Sampension’s own exclusion list.
Source: Sampension
The revelation comes at a time when Sampension is already struggling with a lack of confidence from its members. This is especially true in Pensionskassen for Arkitekter og Designere (PAD) (the Pension Fund for Architects and Designers), which has over 10,000 members and is now part of Sampension.
For quite some time, PAD’s members have criticised Sampension for unambitious climate goals and concealed investments.
PAD has recently held its election for the board, where the two most critical candidates received the most votes and were elected. According to PAD board member Mads Gudmand Høyer, the new board will take the information about Sampension’s investments in blacklisted companies very seriously.
“PAD has just been through an intense election campaign, and the newly elected board members campaigned for greater transparency, among other things. It’s a shame if Sampension doesn’t have better control of their exclusion lists. But it can be expected to receive full attention of a new board,” says Mads Gudmand Høyer, board member of PAD and construction consultant at Landsbyggefonden.
One of the reasons for the members’ distrust is that Sampension received the lowest ranking in WWF World Wildlife Fund’s latest report on the pension sector’s climate efforts. The reason was that Sampension was the only one of the 16 pension funds that refused to participate in the survey.
Based on Danwatch survey, WWF is concerned about Sampension’s work with climate change.
“As the sole Danish pension fund, Sampension does not wish to participate in the latest of WWF World Wildlife Fund Denmark’s regular reports on the progress of the green transition in the Danish pension industry,” says Bo Øksnebjerg, Secretary General of WWF Denmark, adding:
“I hope it is not because they are trying to hide irresponsible climate and nature unfriendly investments, like the ones Danwatch has now revealed in areas such as coal, tar sands and lack of green transition. I urge Sampension to immediately increase transparency on their investments and green profile. What we see now is not good enough.”
Sampension: It’s the customers’ responsibility
Sampension denies that the investments in the blacklisted companies are problematic and points out that they are the customers’ own responsibility.
The external funds that contain blacklisted companies are part of a product called Linkpension, where customers can choose for themselves to invest parts of their savings through a number of funds, Sampension explains.
“This is fundamentally different from Sampension managing funds for the customers. Here, customers manage their assets themselves and make their own choices,” says Jacob Ehlerth Jørgensen, Head of ESG at Sampension, and continues:
“We see it as a universe that is sought after by some customers, and it’s our job to make sure they have some choices.”
But surely you are the ones who have chosen the funds that the customers can choose to invest in. Isn’t that right?
“Yes, that’s correct.”
Together with the business media Finans, Danwatch has previously revealed similar issues in the pension fund Velliv, which also invests in companies on its own blacklist through external funds.
Like Velliv, Sampension points out that these are so-called index funds, where a pension fund cannot impose the exclusion of individual companies in the portfolio.
But if you are the one choosing the funds, it is surely also a choice on your part to offer some funds that contain companies that you have excluded yourself. Isn’t that a compromise against your own values and politics?
“When you have an index product that invests in the entire index universe, you will always encounter one or more companies that are on the exclusion list. It’s a problem that is difficult to resolve,” says Jacob Ehlerth Jørgensen.
Andreas Rasche disagrees.
“It’s difficult, but it’s not impossible. There are many funds, and also many funds that do not invest in companies involved in coal, tar sands, controversial arms and the like,” says the professor of sustainable finance.
In addition to fuelling the crisis of confidence by investing in blacklisted companies, Sampension should also be more transparent about its investments, according to criticism from several quarters.
