PensionDanmark engages in dialogue with authorities and other stakeholders regarding societal issues, particularly how private investors can become involved in finding new and innovative ways to solve them. Not only does this expand PensionDanmark’s investment opportunities, but it also adds to solving societal tasks and challenges.
Screening, dialogue and voting as part of our active ownership complement and underpin our aim towards securing the best possible returns for our members in the long term. Well-run companies that are able to manage financial- and non-financial risks reduce PensionDanmark’s risk as an investor, while increasing future investment value.
Investment Guidelines
PensionDanmark's Board of directors has established a set of guidelines for responsible investments. They take the generally accepted principles as a point of departure, e.g. for social, environmental and governance factors.
To reinforce compliance with the board’s guidelines, PensionDanmark conducts screenings and exerts active ownership, both directly with our investee companies, in collaboration with likeminded investors and through our ethical investment advisor, Federated Hermes EOS (Equity Ownership Services).
PensionDanmark does not invest in securities that are subject to sanctions imposed by the UN or EU.
PensionDanmark does not buy equities or bonds in companies whose activities are in conflict with international conventions acceded by the Danish state.
PensionDanmark does not invest in companies involved in tobacco production, companies with significant thermal coal production (more than 5% of revenue), mining companies that initiate new thermal coal extraction, or companies that construct new coal-fired power plants announced after 2023. In addition, we do not invest in companies with significant revenue (more than 5%) from tar sands, nor in companies from Russia and Belarus.
Once a year, PensionDanmark's reassesses the general guidelines for investments. The guidelines for responsible investments are taken into account when the strategic benchmark for our asset allocation is determined.
Screening
PensionDanmark regularly screens its equity portfolio for observance of the guidelines for socially responsible investments established by the board of directors in relation to:
- Labour - and human rights
- Environment- and climate factors
- Corruption
- Corporate Governance
The guidelines take the generally accepted norms based on international conventions and agreements:
- UN's Universal Declaration of Human Rights
- ILO-Conventions
- UN’s Guiding Principles on Business and Human Rights
- OECD's Responsible Business Conduct for Institutional Investors
- The Paris Climate Agreement
- UN Global Compact principles
Dialogue
PensionDanmark engages directly in dialogues with selected companies; however, the majority of our dialogues are conducted by, or in collaboration with, our stewardship service provider, Federated Hermes EOS, which together with PensionDanmark determines which companies should be given particular focus. This is decided, among other things, based on the companies’ size and a risk-based assessment of whether the companies’ conduct across a range of environmental, social, and governance issues is aligned with shareholders’ interests.
Dialogue is a lengthy process, in which gradual progress must be employed to foster initiatives promoting improvements. Considerable challenges can arise in cases where the company’s business culture and approach to corporate governance differ from the Danish context.
To ensure the best grounds for achieving satisfying results, discussions are conducted in confidentiality, which allows the companies to engage in a constructive and open dialogue.
In some instances, companies may refuse to engage in a dialogue. Dialogues can also be unproductive, e.g. if the company refuses to acknowledge the issues we raise. This can lead PensionDanmark to vote against the directors on a general meeting.
Voting
PensionDanmark can, amongst other things, exert our influence by exercising our shareholder voting rights at our investee companies’ annual general meetings. As a standard, Federated Hermes EOS votes on our behalf based on PensionDanmark’s own voting policy, while PensionDanmark votes directly at Danish companies' general meetings and some selected non-Danish general meetings. PensionDanmark annually publishes the results of our dialogues and voting in our Annual report.
PensionDanmark’s commitment to Net-Zero before 2050
As a member and co-founder of NZAOA, PensionDanmark is helping to pioneer standards for the measurement and reporting of investment portfolios carbon emissions as a tool to achieve a carbon neutral real economy before 2050.
NZAOA was convened by UN and is supported with secretary staff from UNEP’s Finance Initiative and UN PRI. Consisting of primarily pension and insurance companies, NZAOA had assets under management of more than USD 9 trillion in 2025 with signatories across 19 countries.
Focusing on real economic impact, NZAOA works to strengthen mandatory reporting methods, exercise active ownership and inspire each other to invest in the green transition. In 2020 and again in 2025, we sat interim targets on the way to fulfill our net-zero commitment.
Approved Science Based Target
In September 2023, PensionDanmark became among the first pension funds to receive approval from Science Based Target initiative (SBTi) of our 1,5C targets. The Targets cover more than 50% of AUM, including real estate, electricity generation and listed equity and corporate bonds.