On November 5th 2025, a large coalition of Danish Youth organizations are sending an open letter, urging the Danish Pension companies to raise their ambition on climate action.
The letter is sent by AnsvarligFremtid (ResponsibleFuture) together with a large number of Danish youth organizations (Ungeklimarådet, Den Grønne Ungdomsbevægelse, GAIA, FLOR, Saga, Lærlinge for Bæredygtighed) as well as the majority of the Danish youth political parties (Radikal Ungdom, Socialistisk Folkepartis Ungdom, Venstres Ungdom, Konservativ Ungdom, Danmarks Socialdemokratiske Ungdom, Unge Moderater, Rød-Grøn Ungdom, Socialistisk Ungdomsfront, Kristendemokratisk Ungdom and Alternativets Unge)
In the letter, they put forward the following three demands:
1) Publish a strategy outlining how [The pension company] will use its political influence, through green lobbying, to help minimize systemic risks related to climate change
2) Increase transparency about how the climate crisis threatens long-term returns and the future of pension schemes
3) Strengthen the inclusion of younger members’ perspectives in the pension companys long-term strategy
Background
Parallel to the launch of the letter, six of the coauthors of the open letter have explained the reasons for sending the open letter in a chronicle in the Danish newspaper Børsen.
In the chronicle, the authors argue, that as the world is currently on track for more than 3 degrees of warming by 2100, this will result in much more dramatic and potentially catastrophic consequences that will make some places uninhabitable and leave no one’s life or livelihood untouched. Although the impact of the increasing global warming is not easily predictable, many scientists are concerned about the “tipping points” of the climate, which, if exceeded, can lead to potentially irreversible systemic changes. Furthermore, there is a risk of domino effects where e.g. climate-induced drought can lead to fires and/or food shortages, which again can cause conflict or forced migration and political instability. The risks are significant and, if they happen, they will have dramatic consequences for the world economy, including for the value of pension companies’ assets.
Current models are flawed, assuming benign effects on pension companies’ values
Despite the widespread concern of climate scientists, the models used to map climate risks for Danish pension companies do not reflect this frightening reality. Many models predict that global warming of up to 4 degrees will have only a minimal impact on investment, even with warming as high as 7 degrees. As an example, the latest annual report for Denmark’s largest pension company, PFA, shows that they predict that the value of their stock portfolio will increase more towards the year 2100 at 3 degrees global warming than at 1.5 degrees. We fear that such model results can justify a business-as-usual approach that does not encourage investment in the green transition. We should have a clear expectation that the risk models used are in line with the latest climate science.
Systemic climate risks require an increased duty of action from pension companies
Climate change is global and constitutes a “systemic risk” that threatens all types of investments in all parts of the world. That is precisely why pension companies cannot spread their risk around the enormously harmful effects of global warming of 3 degrees. We believe that pension companies, as a long-term investor with a self-declared social responsibility, have a clear self-interest in increased climate policy action to reduce climate damage. Also, they are obliged to follow the prudent person principle, an obligation to act in the best interests of their customers and protect their business against financial risks. With a management of more than DKK 4,500 billion, the Danish pension companies have great power, also politically. We therefore believe that pension companies should use their political power and influence to work for more ambitious climate policies. Because when the political framework conditions support the green transition, our pension savings become easier to invest responsibly and safely, in order to provide security when we all retire in an old age.
Altogether, these concerns call for at response from the pension funds, and this is why we have sent an open letter to all Danish pension funds. The coalition has made it clear, that it expects each of the pension companies to provide a fully comprehensive reply before end of 2025.
