Nordea Asset Management (NAM) will no longer invest in US chemicals company DuPont, marking the manager’s first exclusion on biodiversity grounds.
Decisions relating to exclusions or engagements with portfolio companies are made by NAM’s responsible investments committee, which is chaired by CEO Nils Bolmstrand and includes senior managers such as responsible investment boss Eric Pedersen.
NAM’s blacklisting of DuPont is its first to be made explicitly on biodiversity grounds, Pedersen told Responsible Investor.
He said the company was flagged for examination due to its poor performance on biodiversity principal adverse impacts (PAIs). These metrics are a key element of the EU’s sustainable finance disclosure rules to ensure that activities do not come at the expense of environmental objectives.
“We have for some time been stepping up the use of the PAIs to guide our engagements both at the product and firm levels,” Pedersen said. “The action on DuPont came after it was flagged as an outlier on biodiversity PAIs, which triggered an analysis and discussion regarding the company’s liabilities for legacy PFAS pollution [also known as ‘forever chemicals’ due to their long-lasting presence].”
DuPont did not respond to a request for comment.
Nordea has separately axed Brookfield AM from its investment universe over the latter’s involvement in the production of nuclear arms through one of its holdings. The Canadian investor, which made ESG heavyweight Mark Carney chair last year, was excluded in 2019 by Swedish buffer fund AP7 for the same reason.
According to Nordea, a screening provider – which it did not name – in January flagged Brookfield’s involvement in nuclear arms through its ownership of US nuclear power equipment maker Westinghouse Electric. The provider noted that the “nature of the civilian vs military-use activities of the company” had been up for debate for some time.
Nordea said it did not engage with Brookfield due to an automatic exclusion policy for nuclear arms.
Brookfield and Westinghouse declined to comment.
In addition, Nordea will not invest in six Adani Group companies: Adani Enterprise, Green Energy, Power, Renewable Energy, Total Gas, and Transmission. While it did not have existing exposure to those companies, the Nordic manager axed two companies where it did have holdings over ties to Adani and its owner. These are Ambuja Cement and Adani International Container Terminal.
The decision was attributed to Adani’s activities linked to Myanmar. This month, the Indian conglomerate announced its exit from the country through the sale of its Myanmar ports business.
Nordea has also added Gazprom and BHP to its exclusion list, for involvement in Artic drilling and coal mining respectively. Gazprom would also be excluded under a new automatic blacklist for Russian and Belarusian businesses due to the countries’ “unprovoked aggression in the war in Ukraine”.
The asset manager has separately removed Israeli arms manufacturer Elbit Systems from its exclusion list for cluster munitions. This was after data provider ISS-ESG concluded that the company no longer had any involvement in the sector, it said.
Nordea currently holds €1.8 million worth of Elbit shares, all within its conventional or EU-designated Article 6 funds.
A raft of investors have divested Elbit in the past years, including Axa IM, Deutsche Bank and HSBC.