28 November, 2018

ESG Direct Investments

For AP6, responsible investments and sustainability are prerequisites for delivering a long-term high return. Sustainable development is fundamental to the well-being of future generations and for generating an economic return to future pensioners. As a Swedish, state-owned pension fund, AP6 can and should be a forerunner for responsible investments and sustainability. The Deputy MD leads sustainability efforts, which are coordinated by the Sustainability Manager. Investment Directors are responsible for day to day integration of ESG in companies and funds. In 2019, AP6 added more ESG resources by establishing an ESG team comprised of employees from other parts of the organization.
Since 2013, sustainability has been an integral part of AP6’s investing activities, e.g. as a component of the review and follow-up on investments. As an investor in various types of businesses, sectors and geographic locations, it is necessary to have a broad approach to sustainability that is based on international standards on human rights, labor rights, the environment and anti-corruption. AP6’s Code of Conduct provides the foundation for its responsible investment activities. Each year, the Board sets specific sustainability goals for investing activities.
In 2019, performance improved slightly for all of the goals. Nevertheless, it is important to remember that the investment portfolio changes rather significantly from year to year and because of that, caution is advised in making any far-reaching conclusions regarding performance on set targets. For some of the direct investments, there was no formal code of conduct in place at the time when the investment was made. For new investments, changes typically occur after the investments are made, such as reviewing and improving the governing documents associated with sustainability.
For co-investments, the ownership role and corporate governance is similar to a fund commitment. Influence is achieved through dialogue and setting requirements towards the manager responsible for the fund and its holdings.

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Sustainability meetings

Each year, meetings are held to discuss sustainability with companies where AP6 is a co-investor. These meetings are intended as a supplement to the existing reporting. In 2019, AP6 held three such meetings with a particular focus on sustainability. The companies were selected based on input from the investment organization and consideration was given to the company’s industry, geographic location and the identified ESG risks. These meetings provide AP6 with more knowledge of the sustainability risks and opportunities. They also encourage the company and investment partner to continue developing their sustainability approach.

Allegro – one of Poland’s leading internet trading places. Together with the main owner, Permira, AP6 held a meeting in Warsaw during August 2019, with the e-trade company, Allegro. Topics discussed at the meeting included cyber security, diversity, logistics and transports. There was also a visit to the company’s warehouse.

 

 

 

 

FläktGroup – Global manufacturer of ventilation and air purification units. Together with the main owner, Triton, AP6 held a meeting in Wurzen, Germany, during October 2019, with FläktGroup. Topics discussed at the meeting included health and safety, diversity and energy efficiency. There was also a visit to the company’s training center.

 

 

 

 

OneMed – Europe’s leading healthcare partner. Together with the main owner, Nalka, AP6 held a meeting in Stockholm during October 2019, with OneMed. Topics discussed at the meeting included sustainability in the supply chain, phase-out of products containing hazardous chemicals, logistics and anti-corruption.