A third of Swedish companies making little sustainability progress despite local investor pressure

Sustainable Value Creation in Sweden reports second year findings.

A third of Sweden’s largest companies have made no significant improvement on sustainability issues in the last two years despite pressure from a collaboration of 14 of Sweden’ largest institutional investors with assets of SEK 5 trillion ($730bn) of which SEK 650bn is invested in their home market. Sustainable Value Creation (SVC), the shareholder group, which includes Sweden’s AP (AP1, 2, 3 and 4) government buffer funds said its second year of approaching the CEOs of the 100 largest companies (of which 82 responded) on the NASDAQ OMX Stockholm Exchange reveals that they can be divided into three groups: the leaders, the pack and the stragglers.
SVC does not name the companies in each class, preferring to lobby for change informally. It said the leaders consisted of ten companies that integrated sustainability across the organisation and had been doing so for several years. These leading companies had also continued to make the most progress in the last two years, it said.The ‘pack’ it said, was about 40 companies that are working on sustainability issues and progressing in communication and reporting.
However, it said it was worrying to see the “low development rate” of the ‘laggards’, although SVC notedthat that the companies that scored the lowest in 2009 were now showing tendencies towards taking small steps in the right direction. Nadine Viel Lamare, Senior ESG Analyst at Första AP-fonden (AP1) and spokeswoman for SVC, said: “The fact that more companies are making real headway and that these issues are being prioritised is good, but the slow pace of change among those companies that are at the bottom is of concern to us.” Broadly, SVC said corporate transparency on sustainability in Swedish companies had increased: just over 60% of respondents publish their guidelines compared with just over 50% in 2009. It said the use of management systems to monitor these guidelines had increased from 67% to 90%, while checking of external suppliers had also risen from 60% to 80%. Viel Lamare said: “It is also encouraging to see that a quarter of the companies are training new and existing board members in sustainability issues – an indication that sustainability issues are being increasingly prioritised in the work of company boards.”
Sustainable Value Creation started as an initiative of Norwegian institutional investors in 2008 before being taken up by Swedish investors.