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Denmark’s Lærernes Pension awards ESG bond mandate to giant US manager

Teachers’ fund taps State Street Global Advisors

Lærernes Pension, the DKK41bn (€5.5bn) Danish teachers’ fund, has awarded a $271m environmental, social and governance (ESG)-screened corporate bond mandate to State Street Global Advisors.

The brief covers passive US investment grade bonds, SSgA, the asset management arm of banking giant State Street Corp. said.
Lærernes, which provides pensions and life insurance for around 130,000 teachers, has determined an ESG screen which will be implemented by SSgA.

Lærernes has had an ethical policy since 1997. It excludes companies involved in weapons or trafficking, human rights abuses or which demonstrate “irresponsible use of natural resources and /or unnecessarily impact the environment”.
It has two internal ethical forums which meet regularly and is one of the leading European institutional investors in forestry, with around 7% of its assetsinvested in the asset class. Danish asset owners are seen as among the leading ESG investors in the world. Seventeen Danish funds, for example, are signatories to the United Nations Principles for Responsible Investment, although Lærernes itself is not a signatory.

“We are excited to welcome Lærernes Pension to our growing client base in the Nordic region and are pleased that they recognize the value in SSgA’s ability to provide a tailored solution,” said Benoît Fally, senior managing director at SSgA. The firm has some $469bn in fixed-income assets under management.

Last year SSgA said it has $85.8bn managed using ESG criteria, 5% of its total assets under management. “Because the needs of our clients vary significantly, we consider ourselves a ‘quiet leader’ in ESG investing,” State Street said in its Corporate Social Responsibility Report.