Screening our investments
Nordea Asset Management (AM) screens all holdings in actively managed funds to identify companies that violate international norms, including those related to environmental protection. We believe that companies that integrate environmental, social and governance (ESG) factors in their business models represent more sustainable investments.
We also offer three enhanced Responsible Investment funds – Emerging Stars, Swedish Stars and Nordic Stars – which invest in the best performing companies from an ESG perspective.
Green bonds: investing for impact
We first entered the green bonds market as an arranger for our customers, and now Nordea AM has also invested in green bonds in a selection of our fixed income funds. These combine the fiduciary element of fixed income products with climate change mitigation.
Green bonds are used to raise finance for initiatives with positive environmental impact. They help us increase our pool of sustainable investments and are a natural choice for us as we seek to embed ESG issues in our investment decisions..
While most issuances to date have targeted climate change mitigation, other areas – such as water conservation and clean transportation – are considered for financing. The market for green bonds is strong and growing quickly, having almost tripled in 2014 compared with the previous year.
Collaborating to tackle climate change
Together with 80 other pension funds and asset managers, Nordea AM is a member of the Institutional Investors Group on Climate Change (IIGCC), a forum for collaboration on climate change for investors. IIGCC encourages public policy, investment practices and corporate behaviour that address long-term risks and opportunities associated with climate change.
We are also a signatory to the CDP whose aim is to collect and spread information concerning greenhouse gas emissions and climate change strategies. We make use of the CDP database in our ESG analysis of our investments.
In 2014 we became a signatory to the Montreal Carbon Pledge, which commits us to disclose the carbon footprints of our equity funds. We support this initiative as we believe that increased transparency of funds’ carbon footprints contributes positively to tackling climate change.