ABP as a force for good

Transcription

1 ABP as a force for good Responsible investment policy RESPONSIBLE INVESTMENT POLICY Rotterdam, October 6th 2017 Corien Wortmann Chair of the board of ABP 1

2 Agenda: ABP s ambition as a force for good Objectives for responsible investment Best in class for listed companies Sustainable Development Investments 2

3 ABP S AMBITION AS A FORCE FOR GOOD 3

4 ABP facts & figures (August 31, 2017) Pension fund for government, education and public sector 2.9 million beneficiaries employers Assets under Management 394 bn World wide investments in all asset classes APG is our Asset Manager and service provider with 3500 employees As many as 1 out of 6 citizen of the Netherlands now receives or will receive a pension in the future from ABP

5 Why a new Responsible Investment Policy? ABP participants and the (global) public increasingly demand more sustainable and responsible investments Vision 2020: ABP wishes to realize returns in a responsible and sustainable manner ABP wants to use its influence as a large and long term investor Acting as a force for good without compromising return and risk The starting point for an ambitious new approach towards 2020

6 Costs Complete integration of ESG factors in all our investments Until Now Return Risk Return Return ESG criteria Sustainable & Responsible Conditions Focus on exclusion Complete integration Inclusion (best in class & engagement) - Complete integration of objectives for sustainability and corporate social responsibility - Targeted selection of companies in which we do wish to invest (inclusion) and apply our influence for improvements (engagement) - Objectives for investments and engagement (dialogue with companies/involvement) - Transparant and accountable for our policy, active dialogue with participants and stakeholders

7 OBJECTIVES FOR RESPONSIBLE INVESTMENT 7

8 Investment objectives 2020 Reduction of our carbon footprint of 25% in 2020 An extra effort is also made for specific ABP themes: Investments that contribute to a better and cleaner future: from 29 billion to 58 billion in 2020 Including investments in renewable energy: from 1 billion to 5 billion in 2020 Ban Child labor Cocoa Respect Human rights Textiles, ICT and Energy 1 billion in communication infrastructure and education Safe working conditions Textiles, Shipping and Infrastructure

9 How do we contribute to climate change challenges Reduction in CO 2 footprint of our equity portfolio by 25% in 2020 Investments that contribute to a better and cleaner future: from 29 billion to 58 billion in 2020 Including investments in renewable energy: from 1 billion to 5 billion in % + 29 bn + 4 bn

10 How to achieve our goals? Carbon budget for listed equity maximum quantity of CO 2 per invested euro Active search for investments with a positive influence on people and the environment Leading role in industry-wide initiatives to raise the ESG standards and assessment of investments, for example: Principles of Responsible investments (PRI) Institutional Investors group on Climate Change (IIGCC) revision of EU Emissions Trading System GRESB Real Estate / GRESB Infra initiator for benchmarking real estate and infrastructure on sustainability: focus on investing in Green Stars Corporate Human Rights Benchmark (CHRB) IMVO-convenant in pension sector Continued dialogue with participants, governments and NGO s

11 BEST IN CLASS FOR LISTED COMPANIES 11

12 Specific selection of listed companies Leaders and potentials Sector A Sector B Sector C Leaders (return, risk costs and corporate social responsibility). Rank in the best half (best in class) of the sector. Potentials: attractive investment (return, risk and costs) and prospects of improved sustainability through engagement Not excluded, not included (not financially attractive and/or no prospects of improvement through engagement) Excluded investments

13 ABP s choice for inclusion

14 Inclusion: a different mind-set Targeted selection The bar will be raised for inclusion in the ABP portfolio Targeted selection of investments and more stringent requirements Engagement will have an even more important and more focused role The approach and time path will differ for each investment category Consequences: The portfolio will hold less titles and become more manageable (e.g. estimated 1/3 reduction in names in the current equity portfolio)

15 Continued company engagement As part of inclusion policy: Targeted engagement: from laggards to leaders, focus on potentials Based on UN Global Compact s 10 Principles: Safe Working Conditions Respect for Human Rights Eliminate Child Labor Bribery and Corruption Corporate Governance Environment (CO2) Thematic focus: Ban child labor in supply chain (cocoa) Respect human rights (textiles, IT, energy) Safe working conditions (shipping, textiles, infrastructure)

16 SUSTAINABLE DEVELOPMENT INVESTMENTS 16

17 The investability of the SDGs

18 ABP sustainable development investments ABP defines SDI s as investments in companies with a positive influence on people and the environment through their products and services We are contributing to several of the UN Sustainable Development Goals Moving from High Sustainability Investments to Sustainable Development Investments By 2020 ABP will have 58 bn of SDI s that contribute to addressing social and environmental issues SDI s today consist of sustainable real estate, green bonds and renewable energy assets

19 Investments in the Netherlands Proactively looking for opportunities to invest in the Netherlands ABP takes a positive view towards investments that strengthen the Dutch economy On a best efforts basis APG will search for investments and develop initiatives that strengthen the Dutch economic structure and stimulate growth Without making any compromise on: risk, return, costs and sustainable/responsible criteria Examples: Avantium, a Dutch bioplastics and catalysis research company Vesteda, real estate company with focus on improvement of energy performance ForFarmers, provides feed solutions for (organic) livestock farming Scholen voor morgen, initiative for sustainable and healthy indoor climate of schools

20 Thank you