Sweden’s AP3 sets out action plans for key sustainability risks

Over the past year, Sweden’s AP3 has been setting out plans for how to address the greatest sustainability risks facing its portfolio. The Swedish national pension fund has established four focus areas: corporate governance, climate, human rights and biodiversity, which are identified as systemic risks that the pension fund needs to address over the longer term. This has resulted in action plans for the four areas, setting out its strategy, targets, metrics and expectations for companies.

The biodiversity action plan was the last one to be published and also one of the most challenging areas to specify and define, according to Fredric Nyström, head of sustainability and governance at AP3. “This is a new topic for most investors and we’re approaching it with a great deal of humbleness,” he says. “As it stands, we haven’t got the capacity or knowledge to make analyses that could form a basis for investment decisions. Our starting point is active ownership. We’ve set expectations for companies linked to TFND (The Taskforce on Nature-related Financial Disclosures) but these are initially not