Danish pension provider PKA has tightened up its requirements for investing in coal and has excluded 20 companies with exposure to coal.

In the future, it will not invest in companies with more than 20 per cent of turnover from coal. However, PKA is continuing its dialogue with companies that are willing to adjust to more sustainable energy. As a result, it is still investing in 12 companies that currently have a coal turnover of more than 20 per cent, but are ready for change.

PKA deputy director and head of responsible investment, Dewi Dylander, said: “It is absolutely central for PKA to be an ambitious and responsible green investor, and we are constantly working to bring our investment portfolio in line with the objectives of the Paris Agreement.

“There is no room for companies that are not willing to adapt to a reality with less coal and more green energy, and therefore we are now tightening the requirements for the coal sector and excluding a large number of coal companies.”

In 2015, PKA was the first pension company in Denmark to blacklist coal companies from an economic and climate point of view. It has proven to be a good decision for both the climate and the pension fund's finances. Since then, the world's coal companies have lost about 40 per cent of their value, according to the Stowe Coal Index.

Speaking about the dialogue that PKA us having with companies that have expressed a willingness to change, Dylander said: "These are companies where we make an exception because they have listened to the call that we and a large number of other investors have made to switch away from coal.

“We want to continue that dialogue so that we can make sure companies deliver on their promises. We believe that we can create the biggest change by pushing companies in a greener direction.”

The dialogue takes place, among other things, through the Climate Action 100+ collaboration, which represents 450 investors with a total of DKK 265trn in the account.

The 12 coal companies, along with all other coal, oil and gas companies, will be evaluated by PKA by the end of 2022 at the latest. If they have not incorporated the Paris Agreement's objectives into their business strategy by then, they will be excluded.

PKA has now blacklisted a total of 89 coal companies to date. In addition, it has blacklisted 68 oil and gas companies as well as a car manufacturer due to a lack of focus on the climate. In the same period, PKA has more than doubled the pension fund's green investments, so that today they amount to more than DKK 30bn.

Share Story: