A number of Asian coal producers have been cut from Swedish pension fund AP7’s equity portfolio in an expansion of the scheme’s blacklist.
The pension fund, which has more than $51 billion in assets under management, introduced a blacklist in 2017 that was tied to the Paris Agreement on climate change.
Any companies that conducted activities that counteracted the agreement would be cut from the fund’s portfolio.
The screening criteria have since been expanded to exclude any company that has continued or expanded its coal production.
As a consequence, 10 coal producers have been excluded, eight of which are Asia-based. The blacklisted companies include China Resources Power Holdings; Coal India; Inner Mongolia Yitai Coal Company; Korea Electric Power Corporation; PT Adaro Energy; SDIC Power Holding; Shaanxi Coal Industry and Yanzhou Coal Mining.
The blacklist is revised twice a year and has excluded 84 companies to date.
According to AP7, the aim of blacklisting is to exert pressure on companies, whose activities are deemed irresponsible, to change their conduct and is thereby an engagement tool, alongside other tools such as company dialogues and voting at general meetings.
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