KPA Pension, which is part of the Folksam Group, has divested its entire shareholding in Tesla. Tesla’s approach to employee rights violates KPA Pension’s investment criteria. The dialogue and advocacy work that has been conducted has been fruitless. Therefore, a decision to divest has been made.
Tesla’s attitude towards its employees’ union rights is problematic in terms of KPA Pension’s investment criteria. KPA Pension has therefore tried to influence the company in various ways, primarily together with other owners, where proposals have been submitted to the company’s annual general meeting two years in a row. Unfortunately, no improvement has been seen and a decision has therefore been made to divest the holding.
KPA Pension’s investment criteria that focus on impact are based on international conventions and the UN Global Compact. These are criteria related to climate and environment, human rights and anti-corruption. Only if the continued opportunities to influence a company in the right direction are deemed hopeless can a decision to divest be made.
– This is not the result we had hoped for. Trying to influence our holdings through ownership control is important for KPA Pension, but now we see no possibility of achieving a change and therefore we have divested the entire holding, says Marcus Blomberg, Head of Asset Management and Sustainability.
KPA Pension’s investment criteria
KPA Pension’s investments have followed a number of investment criteria for more than 20 years. Based on these criteria, we work to drive these issues in the right direction in the companies in which we have holdings. As owners, we have a number of tools to use in our advocacy work. We can seek dialogue with the companies, either alone or together with other investors or NGOs. We can vote and also submit proposals to the annual general meeting.
The impactful investment criteria relate to climate and environment, anti-corruption and human rights. If a company violates any of the impactful criteria, dialogue is initiated first and then continued advocacy work. Divestment may occur if a company continues to fail to meet the investment criteria and if, after trying the various advocacy tools, we cannot see any opportunity for improvement.
If a company violates any of the exclusion criteria (e.g. tobacco, controversial weapons), the shares are divested immediately. It is the Folksam Group’s Corporate Governance Committee that makes decisions on these issues.
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