Keva has for many years now been involved in promoting companies’ awareness and reporting of their environmental impacts through the not-for profit charity CDP. Long-term advocacy in our investments continues as Keva deepens its engagement in the programme this summer.
In 2018, Keva was involved in influencing, mainly in association with climate change, in the major polluters in which it is an owner. In 2019, Keva is broadening its advocacy and to include not only companies of relevance to climate change, but is now appealing also to companies whose business entails risks associated with forests and water resources. Efforts will be made to influence companies in April-July 2019 by sending a letter to company management.
Forests and water resources a new focus
“This year, we’re involved in requesting a total of 34 companies to report on climate change as well as on their use of water and forest resources,” says Keva’s Head of Responsible Investment Kirsi Keskitalo.
"We broadened advocacy to encompass companies outside our investment portfolio. Climate change is a global challenge, which also indirectly affects the companies we invest in. Since the system risk caused by climate change cannot be removed by diversifying the portfolio, we are attempting to influence also companies in which Keva has no investments,” adds Keskitalo.
For Keva, responsible investing means carefully managing pension assets in the long term. The risks and opportunities associated with climate change are part of Keva’s assessment of potential investments and many of Keva’s responsible investment objects are associated with climate change. One of the key objectives is to increase influence. By working together, investors can bring about actual measures that can promote the objectives of the Paris Agreement in practice.
Influencing investment objects requires long-term work
Keva has been a member of CDP since back in 2006. CDP aims to promote companies’ transparency around climate change, deforestation and use of water by asking companies to reply to an annual CDP questionnaire. Before companies can respond to the questionnaire, they first have to measure and assess their environmental impacts. Once companies have done this, they find it easier to take action to curb climate change in their own activities and to set and systematically reach emissions reduction targets.
Reporting in this way promotes companies’ own understanding of the risks and opportunities in their own business as well as investors’ understanding of the companies. Keva makes use of CDP data in assessing the responsibility – risks and opportunities – of investments.
To get more and more companies to report their environmental impacts, in 2018 Keva took part in CDP’s Non-Discloser Campaign. The purpose of the campaign is to get companies that have not yet reported their environmental impacts to CDP. Following the campaign in 2018, dozens of new companies came aboard. A higher number of companies brought also a greater group of investors, which further boosted the importance of the campaign.
“It’s important to influence on companies at many levels. Through CDP, companies are called on to report their environmental impacts and, for example, the Climate Action 100+ initiative for its part strives to get companies to take concrete actions to minimise negative environmental impacts. Reporting fosters transparency and also possibilities in practice to intervene in anomalies in the use of natural resources and promotes a more sustainable future,” says Keskitalo.
Over the past 15 years, CDP has created a system that has resulted in unparalleled engagement on environmental issues worldwide. Keva considers influencing investments to be the most important way to promote global sustainability. The goal is to actively influence corporate sustainability by working together with other investors. ”Influencing the activities of investments in this way is long-term work, but the nature of our business means that Keva otherwise has a long investment horizon,” notes Chief Investment Officer Ari Huotari.
Ari Huotari, Chief Investment Officer, tel. +358 400 451 099
Kirsi Keskitalo, Head of Responsible Investment, tel. +358 40 730 6657
Keva has been a signatory to the UN Principles of Responsible Investment since 2008 and a founder member of Finsif, Finland’s Sustainable Investment Forum. Keva has also been a member of Green Building Council Finland since 2014. In 2018 became a member of the Institutional Investors Group on Climate Change (IIGCC), the European membership body for investor collaboration on climate change, and a signatory to the global Climate Action 100+ initiative.