AP6’s carbon footprint (Scope 1 and 2) for 2019 corresponds to 29 percent of the carbon footprint from an equally large investment as per a global index for listed companies. It corresponds to 63 percent of the carbon footprint from a corresponding investment in a low carbon index. Typically, companies in AP6’s portfolio have low direct GHG emissions. However, indirect emissions from the value chain in some sectors can be significant, which is why AP6 in 2019 also estimated indirect emissions (Scope 3), which are not disclosed for 2019. In 2019, AP6 and AP1-4 agreed to start reporting the change in carbon footprint as an addition to a prior agreement on annual carbon footprint reporting. The new reporting reveals that the change in AP6’s carbon footprint stems from changes in the portfolio’s content as well as changes in emissions from portfolio companies.
Given its mandate and focus, AP6 seldom invests in resource extraction. AP6 has very few investments in the energy sector (as of 2019-12-31, 1.5 % of total managed assets). Most such companies in the portfolio provide services/support to extraction industries. In this segment, there are also examples of companies that are increasingly deriving revenues from renewable energy sources, such as offshore wind power. In general, AP6 avoids investments in fossil fuels and has, on various occasions, declined such opportunities. The reason for this is the negative climate impact associated with fossil fuels and the risk of stranded assets (i.e. assets that are no longer possible to extract due to the limitation of a global carbon budget). There are other financial risks to consider as well.
(Enlarge by clicking on chart)