Making pension funds more sustainable
Pension funds have a lot of influence because of their enormous assets. Both ENDS therefore wants pension funds such as the Dutch ABP to withdraw their investments from the fossil industry and to invest sustainably instead.
Pension funds are major investors. For example, the Dutch pension fund for the public sector, the General Civil Pension Fund (ABP), is one of the largest pension funds in the world; one in six Dutch people is a participant. The total invested capital of ABP amounts to more than 400 billion euros.
Fossil investments contribute to climate change
Pension funds invest their money worldwide to guarantee a good pension for their members. Unfortunately, short-term profits are often considered more important than a sustainable future for people and the environment. Many pension funds invest large amounts in the fossil fuel industry, such as coal plants or oil and gas companies. Their investments in the fossil companies enable this industry to continue their activities, because those investments must be earned back.
However, people in the Global South are experiencing the effects of climate change earlier and harder than people in the Global North. At the same time, women and men in the Global South are also front line environmental defenders, and fighting the expansion of fossil fuel extraction in their localities. We think that global investors have a proactive role to play in our collective aim for 1.5 degrees as the red line for global warming.
That is why fossil investments by pension funds must be phased out as soon as possible. As a result, the fossil companies will lose their social license to operate, which speeds up progress in realising the Paris Climate Agreement. In Paris, the world has agreed to drastically reduce CO2 emissions and thereby limit global warming to 1.5 degrees.
Pension funds also invest in industries that are known for their major human rights and environmental issues, such as mining, and soy and palm oil plantations.
Tracking ABP's investments
Both ENDS wants to encourage pension funds to divest their assets from harmful sectors. We focus primarily on ABP, the largest pension fund in the Netherlands. ABP wants to be a "sustainable pension fund", as stated in its Vision 2020.
The analysis that Both ENDS, FossielVrij Netherlands and German urgewald have been doing of ABP's investments, however, show that not much of that is yet coming true. In both 2016 and 2017, ABP turned out to have invested more in coal, oil and gas than in the previous year. We think this is not in line with ABP's own vision, but it cannot be reconciled with "Paris" either. That is why we will continue to critically monitor ABP's investments, together with FossielVrij Netherlands.
Other major investors from all over the world have already shown that it is possible. Various pension funds, such as New York City's five pension funds, have withdrawn all their investments in the fossil industry. The Dutch BPL, the pension fund to which Both ENDS is affiliated, has divested from the coal industry.
Moreover, in early 2019 a group of wealthy Dutch people decided to remove all their personal assets from the top 200 oil, gas and coal companies. These Dutch people are part of the Dutch branch of the worldwide DivestInvest movement, which is supported by Both ENDS, Fossielvrij Netherlands and Stichting DOEN. By investing in climate solutions such as renewable energy, sustainable agriculture and efficient water use instead of polluting sectors, the DivestInvest movement wants to stimulate climate action and accelerate the energy transition.
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Press release / 6 May 2020
The value of ABP's pension fund investments in fossil fuel companies has fallen by 44% from end of last year to its lowest point on March 16 this year, while the value of the rest of the portfolio decreased by 26%. This impact can be seen in simulations based on the publicly available equity portfolios of Dutch pension funds ABP and Zorg en Welzijn (PFZW), carried out by research agency Profundo on behalf of Both ENDS. The simulations show that the risks of investing in the fossil fuel sector are increasing.
Press release / 3 February 2020
Amsterdam, 3 February 2020 - A step forward, but oil and gas remain a blind spot in Dutch pension fund ABP's new investment policy published today. That's what environmental organisations Both ENDS, Fossielvrij NL, Greenpeace Netherlands and urgewald say in response to the new climate policy of the EU's largest pension fund, with assets over 442 billion euros. Although ABP is taking first steps to invest sustainably, more is needed to stop the climate crisis.
News / 2 February 2020
The world has to stop using fossil fuels, but investment in the sector continues unabated. Investors of all kinds, including banks, insurance companies and pension funds, are hesitant about making the change to sustainable energy and are not sure where to start. In the autumn of 2019, together with the DivestInvest Network and Sustainable Energy (Denmark), Both ENDS published a report entitled ‘Managed Decline of Fossil Fuel Businesses’. The report describes five criteria to test whether companies in the fossil sector are actively taking steps to wind down their fossil activities. The criteria are helping investors to choose investments that are in line with the Paris goal of restricting global warming to a maximum of 1.5 degrees Celsius. We spoke to Lars Jensen, Senior Analyst at Sustainable Energy and lead author of the report.
Press release / 24 October 2019
Press release 24 October 2019
Starting today, investors can use five criteria to test whether companies in the fossil sector are actively working on phasing out their fossil activities. Too many investors still seem hesitant to switch to a profitable future of sustainable energy and these criteria should help them do this. The organisations DivestInvest Network, Sustainable Energy (Denmark) and Both ENDS (the Netherlands) publish the report "Managed Decline of Fossil Fuel Businesses" today, which describes these five criteria. The criteria aim to help investors choose investments that are in line with the Paris goal "stay below 1.5 degrees Celsius warming." The recommendations are presented at the World Pension Summit deliberately, because pension fund investors in particular can take more responsibility in this.
Publication / 24 October 2019
Press release / 23 September 2019
Amsterdam, 23 September 2019 - The world's 5th largest pension fund, with assets of over €430 billion, Dutch ABP is continuing to invest in companies that are on a collision course with the Paris climate goals, such as coal and oil companies.
Publication / 23 September 2019
News / 1 May 2019
Amsterdam 1 May 2019 - Dutch pension fund ABP's 'sustainable and responsible investment report’ today suggests that the pension fund is well on track in terms attaining its internal sustainability goals. However, an analysis by Fossielvrij NL, Both ENDS, urgewald and Greenpeace shows that ABP remains on a collision course with the Paris climate goals. At the end of 2018, ABP still invested 16.5 billion Euros in the fossil industry. ABP's investments in the world's 44 largest climate polluters even increased between 2016 and 2018.
Publication / 9 May 2018
Press release / 9 May 2018
New research by Both ENDS, Fossielvrij NL and urgewald shows that, in 2017, pension fund ABP invested 500 million euros more in coal, oil and gas than in the previous year – a total of 10.9 billion euros. These investments in fossil fuels not only stand in sharp contrast to ABP's claim that it has achieved substantial successes in its climate policy, but are also in flagrant violation of the Paris climate agreement. Unlike international forerunners among pension funds, ABP continues unabated to invest in the fossil energy sector.
Publication / 9 May 2018
Press release / 14 May 2017
The Dutch pension fund, ABP, invested about two billion euros more in the fossil energy industry at the end of 2016 than the year before. This is announced by the report "Dirty & Dangerous: the fossil fuel investments of Dutch pension fund ABP," published today by Both ENDS, German urgewald and Fossielvrij NL. The report criticizes these investments because of the impact on the climate and the catastrophic consequences for the people in the areas where coal, oil and gas are being produced.
Publication / 14 May 2017
Publication / 14 May 2017
News / 2 July 2012
Last week the Agricultural Investment Summit took place in London, seeking to promote land as an emerging and expanding investment opportunity. Civil society organisations are concerned that this could lead to further land grabbing, threatening the livelihoods and food security of countless local communities in the global South. In a joint civil society statement Both ENDS urges pension funds and other financial institutions to stop such damaging investment practices.