Swedish pension company, Alecta, has created a calculator that shows how carbon price can affect the market value of companies.

The tool is based on data from Alecta's climate risk report showing how the pension manager's assets are affected by an increased carbon price. The report shows that Alecta's assets are at risk of being affected if the companies they invest in do not reduce their carbon footprint.

To inform Alecta's 2.6 million customers about the link between carbon dioxide emissions and their pensions, a customised tool has been created that calculates how an increase in carbon prices can affect the market value of companies.

"Some of our customers' savings will be invested in companies that will be affected by an increased price of carbon dioxide. It is important for us to make it as easy as possible for customers to understand how we manage their money," Alecta communications manager, Martin Hedensiö, said.

Alecta's climate risk report shows, in addition to the risk of impact on investments, that the data needed to accurately assess companies' emissions is difficult to obtain and that the carbon price recommended by various international organizations in order to achieve climate targets varies greatly, ranging from USD 100 to 1000 tonne.

"It's a very complex matter, but very important for our savers' pensions. The calculation tool we have developed is, as far as we know, the first of its kind,” Alecta head of corporate governance and sustainability, Carina Silberg, said.

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