Danish pension provider PFA is making European security a core pillar of its sustainability and responsibility strategy.

As part of this, the pension provider will increase its European investments by at least DKK 100bn to DKK 500bn, allocate 50 per cent of its listed defence equities to Europe, and launch five new defence-focused investment funds, as it approaches 2030.

It represents a broadening of PFA’s aim of investing responsibly and contributing to a more sustainable societal development.

In recent years, PFA has focused on the green transition through both direct investments and active ownership in the companies it invests in. This effort is now being expanded to European security, including investments in defence, supply chain security, and European competitiveness.

According to PFA CEO, Ole Krogh, the increased focus on security is a direct consequence of recent global developments, as supply security, competitiveness, and renewable energy are becoming increasingly interconnected, while Europe’s security and values are under growing pressure.

He explained: “PFA’s primary task is to create security around customers’ savings by delivering competitive investment returns, while also contributing to a safe society both now and in the future. Recent geopolitical developments have made it clear that Europe needs to become more self-reliant.

“Therefore, we must strengthen Europe’s competitiveness and ensure greater independence in strategically important areas such as defence and energy. This has been a focus for some time, and now we are taking the next step by establishing security as a standalone strategic focus in our work.”

Its new focus will see the pension provider work closely with both the industry and policymakers to make Europe a more attractive investment destination.

“Europe has achieved a stronger shared understanding of the challenges, but more action is needed to strengthen capital markets, improve framework conditions and create better conditions for attracting long-term capital – especially in critical areas such as energy, innovation and defence.

“If Europe is to scale up investment in these areas, the ability to mobilise capital will also be crucial, and here European countries could benefit from taking inspiration from, for example, the Danish pension system.

"It not only contributes to a more robust economy and good conditions for retirement, but also provides significant financial capacity that can be channelled directly into long-term investments in European defence, competitiveness and supply security,” he said.

Krogh referred to the 2024 Draghi report on European competitiveness, which highlighted Denmark, along with the Netherlands and Sweden, as examples of how strong pension systems can mobilise long-term capital.

Together, the three countries account for around 62 per cent of all pension savings in Europe, despite representing only about 7.5 per cent of the population.

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