Issue 2, 2025

The Nordic Fund Selection Journal April/May 2025 issue explores current trends among Nordic pension funds and institutional investors amidst geopolitical uncertainties and market fluctuations. Notably, several Danish pension funds are reconsidering their equity management strategies; while AP Pension maintains an active management approach focusing on sustainable investment and team restructuring, Lægernes Pension has shifted from active to passive listed equity management to better allocate resources, and PensionDanmark adopts a combined internal/external management strategy emphasizing balance and operational efficiency. Finnish state pension fund VER underscores a strategic asset allocation perspective in a volatile global political climate, maintaining a diversified portfolio with selective exposure to sectors like European defense amid regulatory changes.

The issue also highlights Nordic investors' steady appetite for green transition investments despite recent setbacks like the Northvolt bankruptcy, reaffirming the long-term commitment to sustainability. A Nordic investor survey reveals an increasing interest in private equity, developed market equities, and emerging markets, alongside a nuanced view on insourcing versus outsourcing asset management, with concerns about resources and expertise influencing decisions. Corporate governance receives focus through discussions with Sweden's largest asset owners, emphasizing active ownership, shareholder-led nomination committees, and evolving engagement approaches, alongside insights into shareholder litigation as a governance tool. Additionally, the family office landscape in the Nordics is examined from an academic perspective, noting the unique operational models and challenges faced by family offices distinct from traditional institutional investors.

Finally, Nordic Fund Selection Forum 2025 in Helsinki convened fund selectors and managers to discuss sustainability integration, thematic investment opportunities, and governance importance in emerging markets, complemented by innovations in impact measurement. Across these themes, the issue paints a comprehensive picture of Nordic institutional investors navigating evolving market dynamics, operational transformations, sustainability commitments, governance complexities, and the growing significance of family office investment models.

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Table of content

Editorial and Industry Overview

An introduction to major geopolitical and industry changes impacting Nordic pension funds, highlighting reforms in Swedish AP funds, new Finnish investment regulations, and strategic shifts in Danish pension fund equity management, including diverging views on active versus passive management.

Interview: Strategy Revisions at Lægernes Pension

Chresten Dengsøe, CEO of Lægernes Pension & Bank, discusses the pension fund’s shift from active to passive equity management, reasons behind discarding currency hedging, divestment from Chinese equities, recent management changes, and challenges around succession planning amid turbulent times.

AP Pension’s Commitment to Active Management and Team Reorganisation

Pernille Jessen, CIO of AP Pension, emphasizes the value of maintaining an active management approach for long-term value creation, describes restructuring the investment team to integrate liquid assets, and outlines strategic considerations around alternative investments and risk management amid uncertain macro conditions.

VER’s Strategic Asset Allocation Amid Uncertainty

Timo Löyttyniemi, CEO of Finland’s VER, highlights the importance of strategic asset allocation given geopolitical instability, discusses the pension fund’s cautious US equity exposure, focus on European defense industry investments, and managing negative cash flows without revising the existing asset allocation strategy.

Nordic Investor Survey: Equity Optimism and Steady Green Investment Appetite

A Nordic Fund Selection Journal survey reveals sustained investor optimism in equities and consistent appetite for green transition investments despite some setbacks, documents shifts toward outsourcing management, key investment concerns including geopolitics and inflation, and trending asset allocations favoring private equity and developed markets.

PensionDanmark: Balancing Internal and External Management

Erik Bennike, head of equities and credit at PensionDanmark, explains the pension fund’s combined approach of internal and external management, the rationale behind recent insourcing initiatives, maintaining a long-term active strategy with index-near products, and the challenges and advantages related to different asset classes, including credits.

Insights on Manager Relationships and ESG Amid Regulatory Backlash

A discussion on PensionDanmark’s stance regarding asset managers exiting climate initiatives, reaffirming a self-driven ESG strategy, continued commitment to alternative investments, and fostering collaboration between liquid and illiquid asset teams for holistic portfolio management.

Corporate Governance in Swedish Asset Ownership

Leading Swedish institutional investors and experts debate their active ownership approaches including voting, nomination committees, engagement strategies, and collaboration. They examine challenges in external management, the evolving role of litigation as an ownership tool, and assert the importance of balancing governance with sustainable value creation.

Legal Engagement and Litigation as Governance Tools

An exploration of shareholder litigation, particularly in the US context, as a complementary tool for enforcing corporate governance and ESG accountability, focusing on derivative suits, shareholder rights, class actions, and recent shifts in the ESG discourse influencing legal strategies.

Family Office Landscape in the Nordics

Erik Wetter from Stockholm School of Economics discusses academic insights into Nordic family offices, emphasizing their diversity, untraditional investment behaviors, challenges of data transparency, their roles as succession platforms, and the tension between financial theory and family-driven priorities.

Nordic Fund Selection Forum 2025 – Helsinki Highlights

Summary of the inaugural Nordic Fund Selection Forum including panel discussions on sustainability across internal and external management, thematic investment strategies, ESG challenges, and keynote insights into quantifying companies’ real-world impacts with thematic fund manager presentations.

Roundtable on Finnish Real Estate Market

A dialogue among Finnish institutional investors on real estate market sentiment, challenges, sectoral dynamics, liquidity trends, manager selection criteria, inflation protection, sustainability considerations, regulatory impacts, and outlook for investment opportunities amid evolving market conditions.