Danish pension funds manage investments worth approx. DKK 4500 billion (USD 630 Billion). They have set ambitious climate goals, and they participate in climate-focused international investor networks, including the Climate Action 100+ initiative.

But do they also use their shareholder influence to vote for climate proposals at the general meetings of the companies that still need to set the course in a greener direction? That is the question that AnsvarligFremtid asks in this year’s voting report.

Each pension fund is assessed based on how they voted at the general meetings of a number of selected companies in 2024:

  • 20 companies in the banking sector
  • 16 companies in the oil and gas sector
  • 7 companies in the electricity generation sector
  • 12 companies in other sectors, where climate proposals have been marked by the global investor initiative Climate Action 100+ (CA100+) as being “particularly important” from a climate perspective

The report shows that even though Danish pension funds generally support climate proposals more than the average global investor, there is great variation in the practices of Danish pension funds, and in several areas there is still a large need to increase efforts and tighten the requirements for increased climate action towards the companies in which Danish pension funds are invested.

Main conclusions of the report

1) Large variation in pension funds’ climate voting
The report shows that there is a very large variation in the extent to which pension funds choose to use voting as a tool to promote the green transition. While AkademikerPension (74%), Lægernes Pension (73%), Sampension (70%), and P+ (60%) generally vote FOR increased climate action, a number of pension funds are still very reluctant to use the voting tool to increase climate action. It looks worst for Lærernes Pension, which does not use voting at all, but also Nordea Pension (0%), AP Pension (17%) and several others are lagging significantly behind when it comes to using voting as a tool to promote increased climate action.

Table: Overview of Danish pension funds’ voting for increased climate action at general meetings in 2024
Ratios indicate the number of proposals that were supported relative to the number of proposals where the pension fund had voting rights.
Green indicates ambitious climate voting, orange indicates medium climate voting and red indicates poor climate voting.
NVP: Non Voting Policy
NA(S): Indicates non-voting due to lack of shareholding.

2) The growing focus on active ownership must be escalated if it should lead to real change
It is positive to note that several Danish pension funds now seem willing to escalate their active ownership through voting, but it is worrying that the efforts have not yet been lifted to their full potential.

 

Among the positive trends to be mentioned are, that in 2024, pension fund Sampension for the first time helped to co-file an important climate proposal at the state-controlled Norwegian oil/gas company Equinor’s annual general meeting, and that the proposal was “marked as particularly important” on the CA100+ network’s platform. Unfortunately, the proposal, which was supported by 6/7 (86%) of the Danish pension funds holding shares in Equinor, was not adopted, as the company’s main shareholder, the Norwegian state, among others, did not support the proposal.

 

It is also positive that pension fund PFA, on behalf of the CA100+ network, has taken the role of so-called “lead engager” towards the oil/gas giant TotalEnergies, and that PFA also chose to vote AGAINST TotalEnergies’ own climate action plan. However, unfortunately the plan received support from 80% of its shareholders. It is also positive that PFA has publicly expressed its dissatisfaction with TotalEnergies’ current strategy, because of its non-alignment with the Paris Agreement and the COP28 climate summit’s decision that the world must phase out the use of fossil energy.

 

Yet, it is unfortunate that PFA did not find it relevant before the general meeting to mark the proposal related to Total’s climate action plan as “particularly important” on the CA100+ network’s platform. We also find it regrettable that PFA has chosen NOT to pre-announce its voting intentions on the global initiative Principles for Responsible Investments (PRI) resolutions dashboard (bulletin board to inform about particularly important AGM proposals). This would have encouraged far more investors to also vote against TotalEnergies’ irresponsible business model.A concrete next step should be for PFA to submit a shareholder proposal with a requirement for a fully Paris-compliant business plan.

 

However, as PFA holds a shareholding of far less than 1% of TotalEnergies’ share capital, this requires that PFA both wants to and is able to mobilize more large shareholders to support such a proposal if it is to have a real effect. If, on the other hand, PFA does not have the will to escalate its active ownership efforts to its full potential, then the exercise of mediocre active ownership can be perceived as just a useful alibi for not withdrawing PFAs investments from the company.

 

3) Active ownership related to banks and asset managers lacks focus
The report shows that it is still a major problem that many Danish pension funds fail to hold banks and asset managers accountable for living up to their climate commitments. The banks, and the financial sector in general, are essential agents in ensuring financial flows’ support for the Paris Agreement.

 

The report finds that many Danish pension funds continue to hesitate to vote FOR important climate shareholder proposals at the banks’ general meetings, and they also hesitate to vote against the re-election of board members who do not take climate responsibility.

 

It is particularly worrying that several pension funds often fail to support climate shareholder proposals, e.g. Danica Pension (45%) and Industriens Pension (50%). But unfortunately, we also see examples of insufficiently progressive climate voting among pension funds that generally have a fairly active and progressive voting record. For example, AkademikerPension and P+ both voted against an important climate proposal at the asset manager company Blackrock, a proposal which required Blackrock to improve its voting policy to align with the Paris Agreement.

Download the report here
Supplementary appendix with a full overview of votes cast

If you want to know more about the report or AnsvarligFremtid’s work, please contact us at info@ansvarligfremtid.dk.