Climate Investment Surge: Exceeding 2025 Targets Early
PKA has significantly increased its climate-related investments, reaching DKK 56 billion in 2024, up from DKK 42 billion in 2023. This represents 15.5% of the net assets in 2024, surpassing the 2025 target of 15% of assets. The increase is primarily due to growth in listed equities, government bonds, and infrastructure. The fund aims to invest 20% of its assets in climate-related initiatives by the end of 2030. (Source: Årsrapport 2024, page 15, 77)
Social Impact Portfolio Expansion: Doubling Down on Community Investments
PKA’s investments promoting social conditions have grown to DKK 7.3 billion in 2024, compared to DKK 4.5 billion in 2023. The majority of this increase is attributed to investments in social government bonds. The pension fund has a target to invest DKK 10 billion in assets that promote social conditions, focusing on social impact funds and social properties that support strong social communities for both the elderly and young, as well as bonds issued by entities like the World Bank to support healthcare systems in developing countries. (Source: Årsrapport 2024, page 15, 73)
CO2 Footprint Reduction: Ahead of Schedule for 2025 Goal
PKA has reduced its CO2 footprint (Scope 1 and 2) by 63% since the 2019 baseline, reaching 4.4 tons of CO2 per DKK million invested in 2024, down from 6.5 tons in 2023. This achievement surpasses the 2025 target of a 29% reduction for listed equities, bonds, derivatives, and real estate. The fund’s CO2 emissions for Scope 1 and 2 decreased from 438 thousand tons of CO2 equivalents in 2023 to 339 thousand tons in 2024. (Source: Årsrapport 2024, page 78)
Strategic Shift: Refocusing Climate Engagement
In fiscal year 2024, PKA withdrew from the Net Zero Asset Owner Alliance to concentrate its efforts on the IIGCC (Institutional Investors Group on Climate Change), including the Paris Aligned Investment Initiative (PAII). This decision was made to optimize resources and maximize impact on climate initiatives. PKA’s commitment to being CO2-neutral by 2050, with interim targets for 2025 and 2030, remains unchanged. (Source: Årsrapport 2024, page 26, 79)
Investment Policy Refinement: ESG Integration and Exclusion Criteria
PKA’s investment policy incorporates social, environmental, and ethical considerations. The fund does not invest in companies that consistently violate national laws or international organization rules, nor in controversial weapons, coal mines, or tobacco products. For companies using coal for supply, a 20% revenue threshold applies, with exceptions for those demonstrating a clear transition plan. This approach has been in place for several years and continued in 2024. (Source: Årsrapport 2024, page 57, 87)
Biodiversity Focus: New Investor Initiatives
Biodiversity is a new area of focus for PKA. The fund has joined the IIGCC’s Nature Action 100 and the Finance for Biodiversity Pledge, which are now integrated into its responsible investment guidelines. Nature Action 100 is an investor initiative that engages with the 100 largest listed companies on their ambitions and efforts to address nature and biodiversity loss. (Source: Årsrapport 2024, page 88)
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