The ‘vast majority’ of Finnish pension assets are invested following the United Nations’ (UN) Principles for Responsible Investment (PRI), analysis by the Finnish Pension Alliance (Tela) has revealed.

Tela’s analysis, updated to the end of 2024, found that PRI has been used to invest 97 per cent of occupational pension assets, which totalled €271bn at the end of 2024.

Commitment to PRI has been at the same level in previous responsible investment analyses conducted by Tela since 2021.

Tela chief economist, Mikko Mäkinen, said: “Through these principles, investment activities are committed to the environment, social responsibility and good governance, the so-called ESG factors. ESG data is systematically used in investment analysis and decision-making.”

In addition, a ‘significant proportion’ of assets is also committed to other international commitments that promote responsible investment, and Finnish pension funds promote responsible investment by influencing investment destinations directly or through advocacy projects.

Tela’s analysis includes two significant commitments on climate change and nature cover.

Mäkinen said: “At least 88 per cent of pension assets are currently covered by the Climate Action 100+ initiative. The initiative engages companies in a dialogue on the climate agenda and aims to influence companies to become more environmentally friendly.

“The second commitment in our analysis, the Nature Action 100 initiative, aims to promote corporate action to end biodiversity loss. This initiative involves at least 62 per cent of pension assets, either directly or indirectly.”

In addition to projects, responsible investment is also influenced by measurement and reporting commitments. At least 97 per cent of pension assets are involved in the CDP initiative, which encourages companies to report on their environmental impact. CDP reporting collects company-specific information on climate change mitigation, emissions and adaptation.

Tela explained that its analysis of responsible investment for 2024 is slightly narrower in terms of the indicators included. This is due to changes in the field of responsible investment initiatives and commitments.

“For example, the term carbon neutrality has been abandoned internationally. Nowadays, the term net zero is more commonly used, for which the international standard is 2050,” Mäkinen said.

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