The Sampension community has joined a coalition of 46 institutional investors calling on the European Union (EU) not to weaken its carbon emissions trading system (EU ETS) during an upcoming review of the scheme.

The group, which collectively manages DKK 89trn in assets, has signed a joint statement warning that proposed changes to the EU ETS could undermine confidence in the system and slow progress towards the green transition.

The investors argued that the emissions trading system has played a significant role in reducing greenhouse gas emissions and supporting investment in renewable energy since its introduction in 2005.

Ahead of a review of the EU ETS expected in July, the group has urged the European Council to adopt a clear declaration backing a “robust and predictable EU ETS” at its meeting on 18-19 June.

Commenting on the initiative, Sampension chief environmental, social and governance (ESG) officer, Jacob Ehlerth Jørgensen, said a stable regulatory framework was essential to support long-term investment in the transition to a low-carbon economy.

“Both for the climate, for the security of supply in Europe and for European competitiveness, it is important that we succeed in the green transition,” he stated.

“And here we must, of course, all make our contribution. But it also requires clear and stable frameworks that support investments in the transition, and in this context, the EU's CO2 quota system plays a central role in ensuring predictability.

“It is therefore also crucial that the system is not diluted in an upcoming revision.”

Jørgensen also warned that weakening the scheme could penalise businesses that have already invested heavily in decarbonisation while rewarding those that have been slower to adapt.

“If the quota system is diluted, you reward those companies that do not take the transition seriously, and conversely, you punish those that have already taken climate responsibility and made the necessary investments to increase their competitiveness under the system,” he said.

“That is completely the wrong way to go.”

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