Investing in support of democracy and defence

The new reality brought on by the Russian invasion of Ukraine has challenged the notion of what it means to be a responsible investor and changed the perception of how many Nordic investors view the defence industry. Generally speaking, investments in the defence industry has gone from being ESG problematic to becoming ESG positive. Following the new security situation in Europe, PensionDanmark’s CEO Torben Möger Pedersen argues in fact that the concept of ESG should be expanded to also include a “D” for democracy and defence.

“I think it has become clear to many of us that as long-term investors taking a responsible stand, we also have to integrate a focus on defence and democracy,” Torben Möger Pedersen says. “To be a little more political, all the nice ESG things can’t succeed if we’re not able to defend our countries. That’s why I have proposed that we should add a ‘D’ to ESG – for democracy and therefore also defence. In order to protect our values and way of living, there’s a need for a strong defence. That’s also why there’s strong support in Europe for