Issue 2, 2023

The Nordic Fund Selection Journal's latest issue highlights several key trends and discussions among Nordic institutional investors, with a focus on climate policies, emerging market equities, alternative asset allocations, and regulatory challenges. Swedish investors exhibit diverging approaches toward emerging markets, with some reducing exposure over ESG concerns and geopolitical tensions, while others maintain or adjust allocations toward countries like India, embracing a more granular strategy. Sustainability in emerging markets presents complex issues such as inconsistent data quality, heterogeneous policies, and measurement difficulties, prompting asset managers to emphasize engagement and credible ESG integration rather than mere exclusion.

Simultaneously, Nordic investors show a cautious shift away from real estate amid rising interest rates and inflation risk, favoring increased allocations to private debt, investment-grade credit, infrastructure, hedge funds, and other inflation-hedging assets. The trend reflects a strategic recalibration in response to volatile markets and macroeconomic uncertainty. In Finland, Ilmarinen’s CIO Mikko Mursula advocates for regulatory reform to increase pension fund equity allocations, thereby enhancing long-term returns amid demographic pressures, while also underscoring the importance of diversified risk management and evolving hedge fund allocations.

The journal further features insights into Nordic asset managers’ fund selection processes and leadership perspectives, alongside an in-depth roundtable on the challenges and opportunities surrounding climate change policies. Participants identify implementation difficulties, data limitations, and regulatory inconsistencies as major hurdles, emphasizing the need for pragmatic approaches that balance ambition with measurable outcomes and stakeholder engagement. Meanwhile, departing AP7 CEO Richard Gröttheim reflects on the fund’s evolution, prioritization of long-term diversification, and proactive legal engagement as tools for sustainable investment and responsible ownership. Overall, the content underscores the Nordic investment community’s adaptive strategies amid shifting economic landscapes, heightened ESG expectations, and complex policy environments.

The magazine is only available to subscribers

If you’re new to Tell Media Group, create an account first.

Table of content

Introduction to Nordic Fund Selection Journal #02 | 2023

Overview of key investment themes including credit allocations amid property concerns, Finnish investor discussions on climate policies, and interviews with notable industry figures such as Ilmarinen’s CIO Mikko Mursula and departing AP7 CEO Richard Gröttheim.

News Analysis: Emerging Markets Sustainability Challenges and Opportunities

Discussion among Swedish institutional investors reveals diverging strategies on emerging market equities, balancing ESG risks, geopolitical tensions, and opportunities presented by demographic trends. Includes insights on internal versus external management and the complexity of sustainable investing in emerging economies.

News Analysis: Nordic Institutional Investors’ Real Estate and Credit Sentiment

Nordic investors show decreasing enthusiasm towards real estate allocations amid inflation and interest rate concerns, while increasing commitment to private debt, investment-grade credit, infrastructure, and hedge funds, reflecting a shift in portfolio positioning and outlook.

On the Move: Mikael Angberg Joins Worthwhile Capital

Former AP1 CIO Mikael Angberg transitions to Worthwhile Capital, a placement agent specializing in sustainable private market investments, aiming to support Nordic and European institutional investors in navigating complex alternative investment opportunities.

Interview: Ilmarinen’s CIO Mikko Mursula on Regulatory Reform and Asset Allocation

Mikko Mursula advocates for regulatory changes to Finnish solvency capital frameworks to enable higher equity allocations and enhanced returns. He discusses lessons from 2022’s market volatility, the role of hedge funds, and challenges in increasing infrastructure investments within current capital requirements.

Roundtable: Finnish Investors Discuss Climate Change Policies

Key participants explore evolving climate policies, implementation challenges, measurement of impact versus emissions, and the tension between global ambitions and local realities. The discussion highlights the complexities of sovereign engagement, ESG regulation, and the need for pragmatic and inclusive strategies.

In Conversation: Richard Gröttheim’s Departure from AP7

An end of an era as AP7’s CEO reflects on nearly 23 years at the Swedish pension fund. Topics include long-term investment philosophies, managing leverage, the transition to new asset classes under recent legislation, and the role of legal actions within active ownership strategies.

Selector Insight: Fund Selection and Manager Assessment at OP Asset Management

Antti Paitula outlines OP’s integrated asset allocation and manager selection approach emphasizing ESG integration, manager trust and process understanding, patience during underperformance periods, and evolving communication preferences in a hybrid working environment.

Up-Close & Personal: Sampension’s CIO Henrik Olejasz Larsen

Henrik Olejasz Larsen shares his leadership philosophy, reflections on his career, current investment concerns including inflation and anti-globalization, views on ESG challenges, and personal interests outside of work, underscoring a balanced approach to pension fund management.

Advertising and Contact Information

Details on advertisers featured in the issue and contact information for Nordic Fund Selection Journal’s editorial team, subscriptions, publishing schedule, and upcoming roundtable invitations.