Danish pension funds join UNPRI en masse following government push

CSR law allows financial institutions to use PRI signatory status as their legal waiver.

A flurry of some of Denmark’s biggest pension funds with combined assets of over €30bn have joined the United Nations backed Principles for Responsible Investment (PRI) in recent weeks following initiatives by the government to allow PRI or Global Compact membership to represent a company’s new legal corporate social responsibility requirement.
The five Danish joiners include the DKr200bn (€26.6bn), PFA Pension, one of the country’s biggest corporate pension fund companies, DIP, the DKr27.3bn Danish engineers pension fund and the Arkitekternes Pensionskasse fund for Danish architects, another large scheme. They are joined by the pension fund for agricultural academics and veterinary surgeons (Pensionskassen for Jordbrugsakademikere og Dyrlaeger) and the fund for Danish M.A.‘s, M.Sc.‘s and Ph.D.‘s (MP Pension, Pensionskassen for Magistre og Psykologer). Denmark recently adopted a law requiring its 1100 largest companies to report on their CSR and socially responsible investment efforts from 2010. Under the bill, publicly listed companies, state-owned companies and institutional investors must include CSR information intheir annual financial reports as well as managements’ expectations for the future with regard to CSR/SRI. The law does not oblige companies to adopt a CSR/SRI policy but it does require companies to state explicitly if they do not have one. The law says that participants of the UN Global Compact or UN Principles for Responsible Investment (PRI) can refer to their progress for these bodies in the annual reports. Denmark already has a significant number of major pension funds that are signatories of the PRI, including Danish DKr445bn (€65bn) pensions giant ATP and other large funds including PKA, Sampension, LD Pensions, Pen-Sam and Pension Danmark. Other Danish pension funds are expected to sign up to the PRI as a result of the new CSR law. Denmark will later this year host the Copenhagen intergovernmental conference aimed at finding a successor to the Kyoto Protocol. The number of recent new joiners to the PRI indicates that interest in responsible investment continues to grow amongst institutions despite the market crisis. The PRI now represents institutional assets worth an estimated $17trn.