Danish pension company Danica has achieved a 52 per cent CO2 reduction in its customers’ investments in equities and bonds since 2020.

Publishing an update, the pension company said it was partly because five out of seven climate targets for the most carbon-intensive sectors have been met, with targets exceeded in the utilities, steel and cement industries.

Danica has set itself the goal of having carbon-neutral investments by 2050. As part of its climate strategy, in 2021, it set CO2 reduction targets for seven sectors with the largest climate impacts worldwide.

At the same time, the carbon footprint from total equity and bond investments has decreased by 52 per cent since 2020 to 2.5 tonnes of CO2 per one million Danish kroner invested. Over the same five-year period, a typical customer has received a total return of 61.3 per cent after costs.

Danica head of sustainability, Dorte Eckhoff, said: "Overall, I'm proud of the result, where we have succeeded in particular in shifting investments to the frontrunners and continue to deliver returns at the top of the commercial market for customers.

“Together with our general climate focus, this has led to a halving of our customers' carbon footprint through their investments. This confirms the value of our investment approach, where green transition and attractive returns for customers go hand in hand.”

Danica noted that these achievements have been met despite a number of global challenges to the global economy, such as the Covid-19 pandemic, the invasion of Ukraine and rising geopolitical tensions.

"With active management and a structured approach, we have been able to manoeuvre through the difficult conditions that have arisen along the way. It has been far from easy, but the climate targets have served as an important management tool for our strategic focus on combining ongoing CO2 reductions with attractive returns for our customers. We are well on track with this task," Eckhoff added.

---