Sweden’s Länsförsäkringar tripled its investments in green bonds in 2019. Over the year, the life and insurance company raised its allocation to SEK 9.5 billion (EUR 892 million), which equals 7 per cent of the total portfolio.
“We have a clear ambition to increase the proportion of climate-smart investments. The rapid shift in 2019 has been possible as we increasingly make our own direct investments in green bonds in the primary market. Since we have strengthened and focused the investments towards this market, this has also had a positive impact on returns,” said Kristofer Dreiman, head of responsible investments at Länsförsäkringar.
Cubera closes largest ever Nordic secondary fund
The Nordic private equity firm Cubera has completed the fundraising for its new secondary fund Cubera IX, which raised a total of EUR 524 million with a first close in December 2019 and a final close in January 2020.
This was the first fund raised by Cubera since its merger with Storebrand’s private equity team last year.
“The merger combines Cubera’s boutique operation with increased institutional backing and has a strong industrial logic. The successful fundraising of Cubera IX demonstrates the continued, strong support from our investors. Following the merger, Cubera now offers investors access to both primary and secondary commitments as well as Nordic and global exposure,” Kine Burøy-Olsen, Cubera’s managing partner, said.
According to a statement by the firm, the cash was raised among the firm’s existing investors, who are mostly European pension funds and family offices.
“The strong support we gained from existing investors secures and strengthens our position as ‘the Nordic private equity partner’,” said Kine Burøy-Olsen.
Cubera IX continues the firm’s strategy of acquiring secondary interests in Nordic buyout funds. With the heavy oversubscription, it surpasses its predecessor Cubera VIII (EUR 405 million) as the largest Nordic secondary fund.
“The private equity market is developing fast, both in size and sophistication. Cubera strongly believes in focus, and we have a team of 20 investment professionals focusing only on private equity, of which 13 are dedicated to the Nordic region,” Kine Burøy-Olsen concluded.
Almost half of Nordic institutions use impact strategies
According to a new survey, conducted by NN Investment Partners together with Danish consultancy Kirstein, 43 per cent of institutional asset owners across the Nordic countries are invested in impact strategies, with another 22 per cent intending to do so in the near future. However, 41 per cent of those surveyed were not willing to invest due to a lack of suitable investment products meeting their requirements. The report stated: “A number of dominant pension schemes in Denmark and Sweden feel that asset managers still need to improve in the context of impact strategies; something that can make it difficult to set up a dedicated impact strategy at present. Other investors are of the opinion that thematic strategies, such as water funds, do not really constitute impact strategies.”
Commenting on the research, Edith Siermann, head of fixed income and responsible investing at NN IP, said Nordic institutional investors, particularly those in Sweden, “are leaders in the field of ESG integration, but investors across Europe and globally display a clear desire to improve”.
She warned, however, that “there are hurdles to be overcome, including the limited size of the investable universe, fee models that are out of synch with the going rate for impact strategies and the complexity of allocating to SDGs”.
More on the survey can be read here.
Ilmarinen allocates to another ESG ETF
The Finnish pension company Ilmarinen has committed EUR 543 million to the new iShares ESG MSCI EM leaders ETF developed by BlackRock. The latest investments builds on the previous ETFs in Europe, US and Japan it developed in co-operation with BlackRock, with the most recent expanding into emerging markets.
The new ETF invests in more than 400 large and medium-sized companies operating across 26 emerging economies. The index excludes companies involved in the business of tobacco, alcohol, gambling, nuclear power and weapons, including nuclear weapons and controversial weapons.
Next, the pension company says it will work towards influencing MSCI to promote the goal of better integrating companies’ carbon risk in the indices tracked by index funds.
“Integrating the carbon risk would entail that the index would better take into account companies’ dependence on fossil fuels. In any case, these new funds are already an important and much-needed addition to the offering of index funds,” said Anna Hyrske, head of responsible investments at Ilmarinen.
Prior to this latest investment, approximately 70 per cent of the EUR 4.8 billion invested in ETFs is allocated to ESG index funds. Ilmarinen says it aims to increase this proportion to 90 per cent before the end of the year.
Danish pension funds invest in eucalyptus plantation
Two Danish pension funds, Lærernes Pension and Sampension, have joined forces to invest a triple-digit million sum in the 36,504 hectare plantation as part of a consortium established by Global Forest Partners, which also includes a UK-based investment fund.
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<strong>Länsförsäkringar triples green bond investments
Sweden’s Länsförsäkringar tripled its investments in green bonds in 2019. Over the year, the life and insurance company raised its allocation to SEK 9.5 billion (EUR 892 million), which equals 7 per cent of the total portfolio. “We have a clear ambition to increase the proportion of climate-smart investments. The rapid shift in 2019 has been possible as we increasingly make our own direct investments in green bonds in the primary market. Since we have strengthened and focused the investments towards this market, this has also had a positive impact on returns,” said Kristofer Dreiman, head of responsible investments atIf you’re new to Tell Media Group, create an account.
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