ABP’s investment policy is being put under increasing scrutiny, in which various advocacy groups are serving as the key “watchdogs”. How do you deal with this as a pension fund and administrator? And what effect does it have on your policy? Diane Griffioen, Head of Investments at ABP, and Claudia Kruse, Head of SRI at APG, discuss this in PensioenPro. “I think we are quite ambitious.”
Every year, the Dutch Association of Investors for Sustainable Development (VBDO) compiles a list of the most sustainable pension funds. ABP is once again at the top of the list. This seems to stand in stark contrast with current criticism on the fund and its administrator’s SRI policy. Advocacy groups accuse ABP of being in agreement with Shell’s climate policy, which they believe is lacking ambition.
These are signals that are taken seriously, and which contributed to ABP’s decision to start recalibrating its policy straight away. In an interview with the pension professional journal, Griffioen says: “In 2020, we reviewed our SRI policy, examining the long-term situation. This included a vision for 2050, objectives for 2030, and short-term goals for 2025. We are achieving these goals, but concurrently we are recognizing that negative effects of climate change are happening faster than we thought. The question is if Net Zero will be enough in 2050. We have to work harder. This doesn’t apply to us alone, but to all parties concerned: the corporate community, investors, politicians. We want to be a frontrunner in this field. That’s why we’re going to formulate new goals.”
20 percent in Sustainable Development Investments
Part of the current – as yet unrevised – policy is ABP’s intention to invest 15 billion euros in the energy transition. The question arises: Is that ambitious enough? “Two years ago, our target was 15 billion euros. That’s what we’re looking at today. I think we are quite ambitious. Those 15 billion euros is not all. We also aim to put 20% of our assets in SDIs by 2025.”
Credibility threshold
The interview with the two ladies at the top continues with their vision on engagement. Diane: “We do not exclude any sectors, with the exception of the tobacco industry and nuclear weapons. We regard the companies we select with a critical eye, and we want them to deliver on their promises. But we do apply a lower limit; a credibility threshold.” The interview also examines the current mishmash of sustainability laws, regulations, and labels. Kruse: “This multiplicity is part of the phase we are in now. As far as we are concerned, it’s achievements that count, not labels.”
Read the entire interview in PensioenPro. Note: the interview is accessible exclusively to subscribers.