Danish govt launches $1bn SDGs fund, aims to attract pension fund investment

The Danish government has launched a new $1bn fund tied to the Sustainable Development Goals – and says it hopes to get the investment involvement of the country’s pension funds.
“I hope pension funds will join in,” Ulla Tørnæs, Danish minister for Development Cooperation, told Responsible Investor: “But we’re not there yet.”
In a speech at Climate Week in New York, Tørnæs said: “Our ambition is to engage public and private financial resources at a level of $1bn invested over four years to support commercially and sustainably viable investments in the developing world of around $5bn,”
The new fund will be run by the Danish Investment Fund for Developing Countries, IFU, with a remit to “expand public private cooperation in the form of public finance”.
She called the collarboration a ‘win-win’ with positive develpment impacts and a decent return on investments”.
The announcement of the launch of the SDG Investment Fund was made at an event organised by the government to signal a new green growth initiative called the Partnership for Growth, or P4G for short. Danish Prime Minister Lars Løkke Rasmussen was co-chair of the SDGs working group two years ago and introduced the event.Denmark has partnered with other what it terms ‘front-runner’ countries such as Chile, Ethiopia, Kenya, Korea, Mexico and Vietnam – and senior government and diplomatic officials were present at the launch, as were leading Danish pension industry figures such as Torben Moger Pedersen and Peter Damgaard Jensen.
P4G is built around three core elements: breakthrough partnerships; inspiring summits; and rigorous evidence and accountability.
The project will “focus on partnerships between public and private ators that enable accelerated transition of markets towards the SDGs,” according to an introductory document presented at the event. Potential parterships could be around food security, liveable cities and urban water.
It aims for P4G to be fully operational by January 1 next year; the Danish government will hold a summit on P4G in Copenhagen late next year.
The event also featured a call for greater definition of what sustainabilty means. Amy Jadesimi of Nigerian infrastructure group LADOL said P4G could help in this regard. It could “tell institutional investors what sustainability is – and what they shouldn’t co-invest in”.
“Nobody has a good definition” of sustainabilty she said during a panel disussion. The idea was supported by Lise Kingo, Executive Director of the UN Global Compact.