When it comes to investing, APG not only considers the expected returns, risks and costs, but also the extent to which an investment is sustainable and responsible. We do this on behalf of our pension fund clients. Because what use is a good pension if the world around you is no longer fit to live in from either an environmental or social perspective? This question, taken from our Report Responsible Investing 2021, really sums it up. A summary of the key points of the report.
Engagement with companies that still need to improve in the field of ESG is an indispensable part of our approach for responsible investing. Last year, we held conversations with a total of 498 companies on behalf of our pension fund clients about their progress on several themes related to ESG. We talked to 66 companies about human rights in 2021. We also entered into a dialog with 70 companies, including Amazon, about safety at work and the right of employees to unite, among other things. APG joined the Platform Living Wage Financials (PLWF) last year at the request of bpfBOUW. The goal of this platform is to encourage companies to pay employees a wage that enables them to make ends meet. We are mainly focusing on food producers, such as Coca-Cola and Mondelēz.
SDI Asset Owner Platform
Another area in which progress has been made, is the further development of the SDI Asset Owner Platform. This platform was co-founded by APG in 2020 and uses artificial intelligence to determine whether and how many companies contribute to the Sustainable Development Goals with their products and services. BlackRock – the world's largest asset manager – decided last year to start using the platform’s data. This has taken us yet another step closer to our goal of making the platform a standard for investments in the Sustainable Development Goals.
CO2 footprint
APG is also making progress in reducing the carbon footprint of the equity investments we manage for our pension fund clients. This footprint has decreased by 48 percent compared to the reference year 2015. In line with ABP's policy, in 2021 APG sold its investments in companies that derive more than 30 percent of their revenues from coal mines or more than 20 percent from oil sands. Last year too, APG invested € 20.8 billion in the Sustainable Development Goal ‘Affordable and Sustainable Energy’ on behalf of our pension fund clients. Our investment in this goal has led to a reduction of the climate risks in our clients’ portfolios and made a contribution to the energy transition. APG invests, specifically for ABP, via the ABP Nederlands Energietransitiefonds (ANET) in innovative solutions for the Dutch energy transition.
Challenges
There are also some challenges left to be tackled. Our pension fund clients, for example, are looking to accelerate their sustainability ambitions. New legislation is also coming our way and we are dealing with the increased urgency of climate change and loss of biodiversity. In order to address these challenges successfully, APG is cooperating where needed with like-minded investors and other stakeholders.
Our pension fund clients will be strengthening their sustainable ambitions further in 2022. This year, on behalf of the funds, we are increasing our focus in a number of areas including climate change, biodiversity and circularity. A stricter voting policy will be applied to shareholder meetings, paying particular attention to climate. We will also take a more critical look at the renumeration for directors and the progress on diversity within the companies we invest in.
Curious about the entire Responsible Investment Report? Read it here.