Denmark’s LD Pensions names Nordea for €160m Future-Fit impact mandate

Danish public pension pot, LD Pensions, has appointed Nordea Investment Management to manage its new €160m impact mandate, inspired by UK charity Future-Fit Foundation’s ‘positive pursuits’ framework.

LD Pensions, which runs the new Lønmodtagernes Feriemidler (Danish holiday allowances fund) and established Lønmodtagernes Dyrtidsfond (legacy cost-of-living allowances fund), began the search for its active “positive pursuits equity” mandate in the summer.

Nordea’s winning bid for the contract, which is worth €3.4m, saw off 16 rivals.

The new segregated fund’s investment universe will be limited to companies with a “purpose, product or service” that aligns with the Future-Fit Foundation’s Positive Pursuits framework by either:

• creating positive impact itself – by taking action to foster well-being or restore the environment,

• amplify the positive impact of others – by helping them take action to foster well-being or restore the environment,

• reduce the negative impact of others – by helping them avoid actions that undermine well-being or degrade the environment.

The Future Fit Foundation is a London based charity that provides tools and guidance designed to steer investors and companies towards alignment with planetary boundaries and thresholds based on “systems science”.

Its Development Council includes the likes of $576bn global asset manager Federated Hermes, UK pension pool Brunel Pension Partnership and UK-based sustainability fund manager WHEB Asset.

Tom Bregman, Head of Corporate Engagement at Future-Fit Foundation told RI that it has been talking with LD Pensions for over a year about its work.

“In terms of the mandate and selection process itself, we didn’t do anything to support LD on that,” he said. “We were involved in introducing the concepts in terms of how the benchmark could be used by companies and asset managers and they kind of ran with that”. 

The award of the mandate comes as LD Pension begins its search for a manager of a global developed markets high conviction equities mandate, in the region of €400m. 

In the tender document the Danish investor states to prospective bidders that “ESG should be fully integrated in the investment process” and that LD Pensions’ exclusion list must be incorporated in the investment restrictions. The contract will run for four years, with an option to extend to seven and is worth €9m.