Benchmark Responsible Investment by Pension Funds in

Transcription

Benchmark Responsible Investment
by Pension Funds in the Netherlands 2009
On track
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Benchmark Responsible Investment
by Pension Funds in the Netherlands 2009
On track
A research paper prepared by Vereniging van Beleggers
voor Duurzame Ontwikkeling (VBDO)
VBDO: Kees Gootjes
In cooperation with
Profundo: Anniek Herder
8 december 2009
This report has been made possible by the financial support of the Dutch Ministry of Economic Affairs (Economische Zaken),
the Ministry of Foreign Affairs (Buitenlandse Zaken) and OxfamNovib. The contents, conclusions and recommendations are,
however, the sole responsibility of the VBDO.
© VBDO Report by The Dutch Association of Investors for Sustainable Development
(Vereniging van Beleggers voor Duurzame Ontwikkeling)
Disclaimer
VBDO will assume no responsibility or legal liability for incorrect or misleading information provided by the sources used for this report.
t h e
D u t c h
A s s o c i a t i o n
o f
I n v e s t o r s
f o r
S u s t a i n a b l e
D e v e l o p m e n t
B E N C H M A R K
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R E S P O N S I B L E
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Executive Summary
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Introduction
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Pension funds and responsible investment
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1.1. The Dutch pension system
1.2. Organization of pension funds
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1.3. Pension fund investment mix
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1.4. Pension sector regulation
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1.5. Consequences of the financial crisis
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1.6. ESG integration by pension funds
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1.7. Dutch public attention for pension fund investment policies
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1.8. Relevant international initiatives
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2.
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Research objective and method
2.1
Research objective
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2.2
Researched pension funds
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2.3
Research period
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2.4
Gathering information
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2.5
Advisory panel
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2.6
Assessment criteria
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2.7
Rating system
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2.8
Indicators
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3.
Results of the research
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3.1
Participation rate
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3.2
Results: Responsible investment policy
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3.3
Results: Implementation
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3.4
Results: Accountability
37
3.5
Final score
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3.6
Progress
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3.7
Conclusions
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4.
Pension fund profiles
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4.1
ABP
48
4.2
BPF Bakkers
53
4.3
BPF Landbouw
55
4.4
BPF Bouw
59
4.5
Bedrijfstakpensioenfonds voor de Detailhandel
61
4.6
Bedrijfstakpensioenfonds voor de Groenten- en Fruitverwerkende industrie
64
4.7
Bedrijfstakpensioenfonds voor het Levensmiddelenbedrijf
67
4.8
Bedrijfstakpensioenfonds Meubelindustrie en Meubileringsbedrijven
70
4.9
Bedrijfstakpensioenfonds Schilders
72
4.10 BPF Schoonmaak
74
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4.11 Pensioenfonds Vervoer
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77
4.12 Bedrijfstakpensioenfonds SBZ
80
4.13 Molenaarspensioenfonds
82
4.14 Pensioenfonds Architectenbureaus
84
4.15 Pensioenfonds Horeca en Catering
86
4.16 Pensioenfonds Medewerkers Apotheken (PMA)
89
4.17 Pensioenfonds Metaal en Techniek (PMT)
92
4.18 Stichting Pensioenfonds Openbaar Vervoer
95
4.19 Pensioenfonds PNO Media
97
4.20 Pensioenfonds Productschappen
100
4.21 Pensioenfonds voor de Grafische Bedrijven
102
4.22 Pensioenfonds voor de Metalektro
104
4.23 Pensioenfonds voor de Woningcorporaties (SPW)
108
4.24 Pensioenfonds Werk en (re)Integratie (PWRI)
110
4.25 Pensioenfonds Wonen
113
4.26 Pensioenfonds Zorg en Welzijn (PFZW)
116
4.27 Spoorwegpensioenfonds
119
4.28 Pensioenfonds Medisch Specialisten (SPMS)
122
4.29 Stichting Pensioenfonds voor Huisartsen
125
4.30 ABN AMRO Pension fund
128
4.31 Ahold Pensioenfonds
131
4.32 Algemeen Pensioenfonds KLM
133
4.33 ARCADIS Pensioenfonds
135
4.34 Heineken
137
4.35 Pensioenfonds Akzo Nobel
139
4.36 Pensioenfonds Ernst & Young
142
4.37 Pensioenfonds Fortis Bank Nederland
144
4.38 Pensioenfonds Gasunie
146
4.39 Pensioenfonds Hoogovens
148
4.40 Stichting Pensioenfonds IBM Nederland
150
4.41 Pensioenfonds ING
152
4.42 Stichting Pensioenfonds KPN
154
4.43 Pensioenfonds Stork
157
4.44 Pensioenfonds TNO
159
4.45 Stichting Pensioenfonds TNT
162
4.46 Pensioenfonds UWV
165
4.47 Pensioenfonds VolkerWessels
167
4.48 Pensioenfonds Wolters Kluwer
169
4.49 Philips Pensioenfonds
171
4.50 Rabobank Pensioenfonds
174
4.51 Pensioenfonds Shell
177
References
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F U N D S
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Executive Summary
The year 2009 has seen the financial crisis expanding into a global recession. Even though there have been
recent signs of a slight recovery in the financial markets, the Dutch and global economies continue to be troubled. In terms of sustainability, much attention is being paid to the global climate crisis. The Copenhagen
Climate Conference 2009 has been and continues to attract a great deal of attention. It is in this context that
the VBDO (Dutch Association of Investors for Sustainable Investment) - in cooperation with research bureau
Profundo - publishes the third edition of this report.
Dutch pension funds are increasingly aware of the fact that they have a responsibility for issues such as the
arms trade, climate change, biodiversity, and human rights. They are at present developing and implementing sound responsible investment policies. In order to assess and compare the efforts made by pension funds
towards this subject, the VBDO undertook a comparative research into the responsible investment policies
and practices of Dutch pension funds. This third edition focused exclusively on pension funds and tracks the
progress that pension funds have made during the past three years. Out of 51 pension funds surveyed, a total
of 43 responded - a response rate of 84%.
At the end of 2007, six months after the televised Zembla documentary "The Cluster Bomb Feeling”, the first
edition of the benchmark revealed that 21 out of 24 investigated pension funds were in the process of developing a responsible investment policy. At the end of 2008, the second edition showed that 17 of the 36 pension funds (49%) had finalized a responsible investment policy and another 12 were well on their way. For this
third edition published at the end of 2009, 37 out of 51 pension funds (72%) have finalized their responsible
investment policies.
Clear progress is being made not only in policy development, but also in implementing the policy by using different instruments. Some encouraging facts:
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33 (last year 20) pension funds have excluded investments in the controversial weapons industry and
individual weapons companies, while 14 of these funds (last year 7) have also excluded companies on other
grounds, such as child labour and environmental pollution.
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15 (last year 10) pension funds make explicit use of ESG criteria in selecting investments;
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27 (last year 12) pension funds address the issue of corporate responsibility in their contacts with
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For 38 (last year 29) pension funds, sustainability plays a role in their voting behaviour at shareholder
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20 (last year 15) pension funds are investing a small amount of their capital in sustainable energy,
companies in which they invest (engagement);
meetings;
innovative clean technology and microfinance.
Despite these encouraging developments, many pension funds still need to translate a responsible investment
policy into a broad and well-balanced combination of instruments. There also remains a lot of work to be done
in terms of accountability towards participants and other stakeholders on the issue of responsible investment:
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Most pension funds are not transparent about the asset managers they make use of and whether or not
these are selected on the basis of sustainability criteria;
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Only 16 pension funds provide details about their asset managers and have established how these
managers are held to the fund’s policy on responsible investment;
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17 pension funds actively engage society in a dialogue concerning their policies;
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16 pension funds actually publish overviews of their (equity) investments.
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Nine assessment criteria were used in the benchmark to assess the pension funds’ efforts towards responsible investment, divided into three categories.
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Policy:
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(Socially) responsible investment policy
Implementation:
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Exclusions (negative selection);
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ESG-criteria for the selection of investments (positive selection);
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Engagement;
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Voting policy;
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Sustainable project financing.
Accountability:
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Transparency in outsourcing
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Dialogue with society
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Reporting on responsible investment policy
All pension funds received a score between 0 and 5 points for each of these nine assessment criteria.
Unanswered questions received a score of 0. The scores of these nine assessment criteria have been totalled
using weighting averages to obtain a final score for each pension fund. The overall score indicates which pension funds have the best overall responsible investment policy, implementation and reporting.
Once again, the highest overall scores were achieved by three industry-wide pension funds. The top two positions are once again Pensioenfonds Zorg en Welzijn and ABP, with each of their scores improving. New in the top
three is Pensioenfonds PNO Media, a smaller pension fund that moves up one position from last year. Among the
pension funds included for the first time in this survey, the highest score was achieved by Pensioenfonds
Openbaar Vervoer (6th).
Over three years, a significant number of pension funds have taken major steps in developing, implementing and
reporting on their responsible investment policies. This can be seen by the increase in the average final score
from 1.6 to 2.1. Nevertheless, considerable improvements can still be made in the implementation of various
instruments. Moreover, the level of transparency, especially in giving an overview of asset managers and how
external parties are committed to the fund’s responsible investment policy, leaves much to be desired.
In the coming year, the VBDO intends to make significant changes to the methodology of this benchmark.
Although the current methodology has been useful in measuring progress in this field, the VBDO does realize that
- despite changes to the methodology made in the past two years - not all differences in responsible investment
practices between pension funds were able to be exposed. In addition to this, responsible investment practices
in general, and the practices of Dutch pension funds in particular, have witnessed dramatic changes over the
last three years. The VBDO is confident that, by revising the methodology and focusing more on different asset
classes, it can continue to stimulate pension funds to invest in an increasingly responsible way.
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Introduction
The report you are reading is the third edition of the Benchmark Responsible Investment for pension funds
in the Netherlands. This report, published by the VBDO (Dutch Association of Investors for Sustainable
Investment) in association with research consultancy Profundo, tracks the development of Dutch pension
funds in formulating, implementing and reporting on their responsible investment policies. The responsible
investment policies for pension funds have been attracting attention since 2007, when the investigative television programme Zembla dedicated an episode to them.
The initial 2007 edition of this report that included 30 pension funds showed that the small group of pension funds already implementing a responsible investment policy received a tremendous stimulus, while the
larger group that had previously taken little to no steps also took steps to catch up. In 2008 the report was expanded to 43 pension funds. The results showed that, despite the outbreak of the global financial crisis, significant
steps had been taken by pension funds to formulate and implement a responsible investment policy.
The year 2009 has seen the financial crisis expanding into a global recession. Even though there have been
recent signs of a slight recovery in the financial markets, the Dutch and global economies continue to be
troubled. In terms of sustainability, a lot of attention is being paid to the global climate crisis. The
Copenhagen Climate Conference 2009 continues to attract a great deal of attention. It is in this context that
the VBDO publishes the third edition of this report. The surveyed group has been expanded to 51 pension
funds while the methodology has remained largely the same. This gives the VBDO and others the opportunity to track the evolution that has taken place over the past three years.
The only major change is that all the questionnaires, profiles, and subsequent reports are written in English.
This decision was made to make the final report more accessible internationally. There has been considerable international interest shown in this benchmark, but due to the fact that it was not written in English,
the impact was less than it could have been.
In this report, the responsible investment policies of 51 Dutch pension funds have been scored and ranked
using nine assessment criteria divided into three categories:
●
The responsible investment policy itself;
●
The activities that have been undertaken to implement this policy;
●
The reporting concerning policy and implementation for participants and other stakeholders.
For all nine assessment criteria, a score has been assigned to the pension funds. Based on their final scores,
the pension funds have been ranked. In this way, pension funds are stimulated to develop a clear responsible investment policy that is aligned with their participants’ priorities, as well as being stimulated to take
up their social responsibility as institutional investors.
The contents of this report are as follows: Chapter 1 provides an introduction to the pension sector in the
Netherlands. Sustainability issues such as the Environmental, Social, and Governance (ESG) issues are described within the context of pension funds, both in the Netherlands and internationally.
The research objective and methodology are introduced in chapter 2. This provides insight into how information was gathered and how the pension funds were scored and ranked.
Chapter 3 is dedicated to the results of the survey starting with the participation rate. Subsequent sections
deal with the three categories: responsible investment policy, implementation, and accountability. This all
leads to a final score for the 51 pension funds. Following this, the progress over the last three years for each
pension fund is presented. The final section of chapter 3 is dedicated to the conclusions that can be drawn
from the results.
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The final chapter (Chapter 4) contains all the individual profiles upon which the results are based. Profiles
are divided into three categories and listed in alphabetical order: industry-wide pension funds, occupational pension funds, and corporate pension funds.
This report has been made possible by the financial support of the Dutch Ministry of Economic Affairs
(Economische Zaken), the Ministry of Foreign Affairs (Buitenlandse Zaken) and OxfamNovib. The contents,
conclusions and recommendations are, however, the sole responsibility of the VBDO.
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funds and responsible investment
1.1 The Dutch pension system
Pension is the income received by people at an older age, when they are no longer actively working. The
Dutch pension system aims to provide everyone with a pension at, or often before, the age of 65. Similar to
other countries, the Dutch pension system is essentially supported by three pillars.
●
1
The first pillar
Old Age Pensions Act (AOW), guaranteeing everyone a basic pension. The purpose of this pillar is to at least provide a basic income for seniors, preventing poverty amongst them. The AOW provisions are financed by an apportionment tax that all Dutch citizens contribute to.
●
The second pillar
Collective pension contracts that are agreed on by employers and employees, also known as supplementary pension. The purpose of the second pillar along with the first is to provide a reasonable income that is related to
the income which people enjoyed during their working lives. Pension is built up with a pension fund or pension
insurance company to which the employer, employee or both pay premiums. Approximately 95% of all Dutch
companies provide pension schemes. The paid premiums are subsequently invested and pensions are paid out
from the return on these investments. The second pillar is usually obligatory in the Netherlands to maintain solidarity. In addition, this system prevents pensions from becoming subject to competition in the labour market
and it results in relatively simple and transparent wage negotiations.
●
The third pillar
Voluntary pension schemes that are entered into individually with a pension insurance company. The third
pillar is meant for individuals running a company, people who cannot lay claim to the second pillar and
employees for whom the first two pillars yield insufficient income because of, for example, frequent job
changes. Individual pension schemes are also referred to as annuity insurance. Here too, the paid premiums
accumulate into capital from which pensions are paid. Whereas the first pillar is financed by the government, the second pillar is mainly the domain of the pension funds. Private pension insurance companies
dominate the third pillar, but also play a role in the second. Pension funds typically are cooperative foundations: employers and employees together make up their management. Pension insurance companies, on
the other hand, are private enterprises and are often part of large insurance companies.
This report relates mainly to the second pillar of the Dutch pension system. In terms of financial scope, this is
the largest pillar in which most Dutch employees are involved. Four types of pension funds deal with the pension schemes in this pillar:
●
Industry-wide pension funds provide pensions for the employees of one or more industries (education,
healthcare, metal industry, etc.). Participation in industry-wide pension funds is usually compulsory. In principle, the pensions of all employees and sometimes of self-employed persons in those industries are placed
with these pension funds. As per June 2009, the Netherlands counted 91 industry-wide pension funds, of
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which 22 are compulsory. The Dutch Association of Industry-wide Pension Funds (VB) has 81 members, which
combined represent 75% of all participants in collective pension schemes in the Netherlands: 4.7 million participants, 6.8 million former (non-contributing) participants and more than 1.2 million pensioners. At the
end of 2007, the combined invested capital of the industry-wide pension funds amounted to more than 500
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billion.
●
Corporate pension funds provide pensions for one specific company or group of companies. As per June 2009,
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the Netherlands counted 53 corporate pension funds. The Association of Corporate Pension Funds (OPF) has
more than 360 members with a combined capital of  200 billion. Approximately 900 000 participants, more
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than 500 000 former participants and 600 000 pensioners are members of corporate pension funds.
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Occupational pension funds provide pensions for self-employed people (doctors, accountants, lawyers,
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etc.). The Netherlands, as of the end of year 2008, counts 12 occupational pension funds. The umbrella
organization for these (generally small) pension funds is the Union for Occupational Pension Funds (UvB). The
combined invested capital of the industry-wide pension funds amounts to approximately 20 billion.
Approximately 48 000 participants, more than 20 200 former participants and 19 400 pensioners belong to
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its members.
●
Private insurance companies provide approximately 46 000 direct pension schemes for smaller companies.
Such insurance companies are members of the Dutch Association of Insurers (VvV). These direct pension
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schemes involve approximately 886 000 participants and 267 000 pensioners. In the middle of 2008, some
67 insurance companies were active in the Netherlands, of which a large number also provide pension insurances.
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It is unknown which part of their capital is allocated to pension schemes. What is known is that
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these pension insurance companies represent 12% of the total collective pension market in the Netherlands.
1.2 Organization of pension funds
In June 2009, the Netherlands counted 612 pension funds. These are all independent foundations and are
being managed by people who represent both employers and employees. Managing a pension fund is, however, not a full time occupation. Usually the persons representing the employees are employed by trade unions and the persons representing employers belong to a company or industrial organization. Pension funds do
not employ many people as almost everything is outsourced - 81.3% of the pension funds outsource its admi11
nistration and 87.5% its asset management. The larger pension funds do have some staff that make sure that
policy decisions and the execution thereof by third parties is implemented. This outsourcing is compulsory
under the new Pensions Act, which took effect in 2007 and translates European law into Dutch law.
In order to prevent unfair competition, pension funds may no longer execute their own pension schemes.
Instead, contracts must be drawn up with executive organizations. Up until 2007, the two largest Dutch pension funds, ABP and PGGM, executed the major part of their activities (pension administration, asset management) themselves. However, from 2008 on those activities have been outsourced to independent organizations that are, however, fully owned by pension funds. The executive organization of ABP has been named
APG (Algemene Pensioen Groep), whereas the PGGM has chosen to give its old name to its executive organization and rename itself Pensioenfonds Zorg en Welzijn (PFZW).
Many other pension funds had already outsourced their pension administrations, including participant contacts. As it is very labour intensive and demands specific competencies, outsourcing these activities is financially attractive. The market of pension execution services is dominated by insurance companies and a number of private administration companies. APG and PGGM now also offer their services to other pension funds.
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In addition to pension administrations, Dutch pension funds must now also outsource their asset management.
Many pension funds already had done this and used different models for this outsourcing. The entire management of assets can be outsourced to one specific asset manager who controls the entire investment portfolio. The largest such organization is British-based Barclays, that manages a capital of 65 billion for various
Dutch pension funds. Other players are American-based State Street and Goldman Sachs.
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Asset management can also be outsourced in stages: so-called fiduciary management is outsourced to one party
that carries responsibility for the return on investments. The fiduciary managers, in turn, use other asset managers who are given mandatory powers over a specific investment portfolio (equity, bonds, real estate, etc.), sometimes limited to a geographic region. This way, an experienced asset manager is allocated to each of the investment categories. Many of these capital executives are from the United States and Great Britain. Fiduciary asset
managers are often the same companies to which pension administrations have been outsourced, or their subsidiaries. Fiduciary management, however, is also outsourced to the large, foreign asset managers.
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Finally, a number of variations of outsourcing are also possible. The executive organizations of ABP (as in APG)
and PFZW (as in PGGM) use an intermediary form: They act as investors for the largest part of the pension
fund capital and at the same time act as fiduciary asset managers for mandates given to capital executives
in specific investment categories. The fact that all Dutch pension funds have outsourced the management of
investment share capital to one or more capital executives makes it difficult to provide insight into the companies in which they have invested. Equally difficult to ascertain is the influence they exert on the investment policies of these asset managers.
Another element introduced by the new Pensions Act is that a certain level of involvement by participants has
to be assured by pension funds. Many pension funds now have a participants’ council, sometimes combined
with board participation. These councils are generally positive about the cooperation with pension funds’
boards. Although many pension funds meet the requirements with regards to pension fund governance (and
participation), smaller funds in particular still struggle to meet these requirements.
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1.3 Pension fund investment mix
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The Dutch pension funds had a combined invested capital of 577 billion in 2008. In order to cover future
pension obligations, pension funds invest their participant’s premiums. They invest in various categories in
order to spread risks and achieve maximum long-term return on investment, which creates an investment mix
that varies per pension fund. Although not always to the same extent, the average investment mix for Dutch
pension funds has changed considerably over the last 25 years, as is shown in 0.
These changes are best summarized as follows:
●
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The proportion of equity investments has increased dramatically, going from 7% in 1985 to 52% in 2007,
mainly because long term equity investments yield higher returns than other investment categories;
●
The proportion of (private) loans has decreased in favour of shares and bonds, which is the result of the
Dutch government exclusively using bonds instead of private loans for long term financing since 1993. This
is attractive for many pension funds, as bonds (and shares) are more liquid than loans. The proportion of
mortgage loans has also been reduced as a result of pension funds converting their mortgage portfolio to
(more) liquid bonds by means of securitization;
●
The proportion of real estate investments has also decreased, mainly because pension funds choose not to
invest in real estate directly, but rather in more liquid shares of major publicly listed property companies.
●
A considerable geographical shift has taken place in relation to this investment mix. Whereas in 1985 only
8% was invested abroad, in 2005 this percentage had risen to 76% of the portfolio.
Figure 1. Investment mix development Dutch pension funds 1980-2005
Real estate
Shares
Bonds
Loans
De houdbaarheid van het Nederlandse pensioenstelsel, Occasional Studies Vol. 4 / Nr. 6, Jan Kakes en Dirk Broeders (red.), De Nederlandsche Bank,
Amsterdam, November 2006.
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The above trends continue, as is demonstrated by recent figures published by de Nederlandsche Bank (DNB).
This changes were more a response to the recent financial crisis which strongly affected equity prices. While
in the beginning of 2007 pension funds invested 41% in equity and 43% in fixed income, in 2009 this had become
32% in equity and 53% in fixed income, as seen in figure 2.
Figure 2 Investment mix Dutch pension funds in 2007 and 2009
2007
5%
2009
5%
11%
10%
Real estate
43%
41%
53%
Equity
32%
Fixed income
Other
DNB, “Overzicht Financiële Stabiliteit in Nederland”, DNB, November 2009.
1.4 Pension sector regulation
The most influential legislation for the Dutch pension sector is the new Pension Act, which came into effect
January 1st, 2008. This Act replaces the Pension and Savings Fund Act. The underlying principles, however,
have not changed. The basic assumption is that pension is a term of employment. Employers and employees,
both represented by social partners, remain primarily responsible for the establishment of pensions. The new
Pension Act equally does not compel employers to offer employees a pension scheme. However, if a pension
contract is entered into, the Pension Act then sets certain conditions for its formulation. One of these conditions is that the contract must be placed with a pension fund or insurance company (article 23 of the Pension
Act). Furthermore, the Pension Act provides regulations for the way in which the pension fund or insurance
company operates. Compliance with Pension Act provisions is supervised by De Nederlandsche Bank and the
Netherlands Authority for the Financial Markets (AFM).
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The new Pension Act serves to increase development towards stronger control over these supervisors in relation
to pension fund investment returns. These returns determine financial coverage, the measure in which they are
likely to meet future pension obligations. These returns also determine whether or not participants can count on
their pensions being indexed, i.e. increasing with inflation. An additional obligation was given to the pension sector when it was decided by the Dutch parliament that a national pension register was to be created (online) providing pension entitled persons with immediate and comprehensive information on pension claims that have been
accumulated throughout the years. An indexation label has also been attached which indicates in a simple way
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(eg. colour coding) the chances of a someone’s pension fund keeping up with inflation.
1.5 Consequences of the financial crisis
The events on September 11th 2001 caused global stock market upheaval and pension funds faced declining
profits. In the following years, with strong support provided by De Nederlandsche Bank (DNB), they did everything possible to recover an acceptable level of financial coverage and, where possible, establish the
indexation of pension payments. The relatively limited (up to March 2007) attention paid by Dutch pension
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funds to responsible investment at the time was partly because of all the attention paid to recovering financial coverage.
It may therefore well be asked what the consequences of the present global financial crisis will be for Dutch
pension funds and their responsible investment policies. Dutch pension funds claim to still be able to fulfil their
obligations, but that they need to make significant use of reserves. The funds in October 2008 stated that coverage in the third quarter of 2008 has dropped steeply. The quarterly figures prove the importance of reserves that
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were built up over the past years, says the Dutch Association of Industry-wide Pension Funds (VB).
The DNB Financial Stability Overview publication stated in November 2009 that after a turbulent period, global financial markets had stabilized. The situation was, however, still fragile. The financial markets and the
economy are benefiting from an improving economy, but are still far removed from the levels before the crisis and early recovery remains uncertain.
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More than 340 funds had to send plans for recovery to DNB in the beginning of 2009. Many pension funds cancelled indexation for 2009 and increased premiums. For employees, this means lower purchasing power and
for employers higher labour costs. Some corporate funds have asked the companies they execute the pension
scheme for to provide an extra contribution. The recovery plans of pension funds can also have a macro-economic impact on the Dutch economy. DNB has estimated that by the end of 2013, the volume of total domestic
production can be 0.75% lower if there is no implementation of recovery plans.
21
Does this mean that Dutch pension funds are about to lose sight of socially responsible investments?
Organizations such as the International Corporate Governance Network (ICGN) and the UN Principles for
Responsible Investment see the financial crisis as an opportunity to generate renewed attention for
Responsible Governance and Investment. A statement issued by the ICGN calls leaders to use improved
Corporate Governance as a tool to re-establish market confidence. If provided with sufficient opportunity,
shareholders would be able to play a major role in this process.
22
1.6 ESG integration by pension funds
1.6.1 Fiduciary duty
Very rapidly and largely under the radar, Dutch pension funds have become influential shareholders at thousands of companies within and outside the Netherlands. Pension funds should use their position as capital providers to deny notorious polluters and human right offenders access to capital, stimulate the large majority
of companies to invest in sustainable development and production methods and grant smaller, truly innovative sustainable companies easier access to capital. Considering the social stature and long term objectives of
pension funds, it seems only natural that they should act accordingly. But are they also allowed to?
Too many in the pension sector and for too long felt that a socially responsible investment policy was incompatible with the sector’s primary task of guaranteeing a stable and inflation-proof pension for its participants.
This so-called fiduciary responsibility was supposed to be at odds with any socially responsible investment
policy that was believed to yield to a lower return on investment. This reasoning can be disputed for a number of reasons.
In October 2005, one of the largest law firms in the world, Freshfields Bruckhaus Deringer, compiled a report
for the UNEP Finance Initiative (UNEP FI). It demonstrated that different jurisdictions have different interpretations of the fiduciary responsibility of pension funds. This responsibility, however, does not force pension funds to merely consider financial criteria: ‘…integrating ESG considerations into an investment analysis
so as to more reliably predict financial performance is clearly permissible and is arguably required in all jurisdictions.’
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The same applies to the new Pension Act, although it does not specifically mention the subject of responsible investment. Article 135 of the Pension Act does demand from pension funds that they follow an investment policy that is in accordance with the ‘prudent person’ principle. With that, the demands as described
in the European Pension manifest in relation to pension fund investment policy are met. The ‘prudent person’
principle implies that pension funds and insurance companies are to invest their capital with due regard to
the interests of entitled and pensionable persons. No pension fund may pursue interests that are not related
to the pension rights and claims of participants. This restriction does not mean, however, that pension funds
may not consider non-financial issues. This remains in effect as long as serving idealistic and non-financial
interests does not dominate to the extent that investment policy no longer leads to an acceptable risk-profit
profile.
24
The latest UNEP FI Asset Management Working Group (AMWG) report, termed Fiduciary II, articulates the evolving nature of fiduciary duties and ESG issues. According to the legal advice of, amongst others, Paul
Watchman, it is now broadly recognised that pension funds have the duty to consider ESG factors.
Furthermore, they have an obligation to state what the fund’s guidelines are on responsible investment and
to what extent social, environment or ethical considerations are taken into account.
25
It is necessary for investment management agreements to clarify the expectations of the parties (for example between pension funds and asset managers) and to make clear that ESG is regarded as a mainstream consideration. Fiduciary II also highlights that institutional investment consultants and asset managers have a professional duty of care to proactively raise ESG considerations with their clients. Failure to do so may have
serious consequences because there is a very real risk that they will be sued for negligence. To this extent,
Fiduciary II shows how a pension fund can operationalize ESG integration in investment mandates.
26
A recent survey found that also many pension funds (around 70% of the 42 respondents to an IPE survey in
2009) agree with the statement that ‘it is trustees’ fiduciary duty to include ESG in their decision-making process and during manager selection processes’.
27
1.6.2 Financial performance
The financial performance resulting from any responsible investment policy is determined by a number of different factors. It is clear that a number of the instruments used to implement a responsible investment policy, such as voting and engagement policies, do not have any negative effect on returns whatsoever. Other
instruments, such as the inclusion of the ESG criteria in the selection of shares might have an effect. In theory, any restriction of the investment universe could potentially lead to a lower return. But on the other hand,
there are also sufficient theoretical reasons to believe that companies paying more attention to social and
environmental issues will reach better financial results, because better investment choices are made. The
question therefore remains: which effect on returns will outweigh the other?
Research by financial specialists has not yet led to a simple conclusion in this issue, particularly where longterm effects are concerned. In 2007, a joint report of the UNEP FI AMWG and Mercer highlighted that the
belief that responsible investment will automatically limit the investment universe and thereby limit returns
is narrow in its focus and conclusions. A number of tools are available for integrating ESG into the investment
process and a full assessment of their merits needs to consider the relative merit of each approach and the
preferences of the beneficiaries that asset owners represent, and then balance those considerations against
available evidence on the performance indication of each approach.
28
Since then, the breadth and depth of academic research measuring the relationship between responsible
investment and financial performance has expanded. In November 2009, a Mercer review of 36 academic studies (of which 16 were released since 2007) concluded that:
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20 studies showed evidence of a positive relationship between ESG factors and financial performance;
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two studies showed evidence of a neutral-positive relationship
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eight studies reported a neutral relationship;
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three found a negative-neutral relationship; and
●
three studies showed evidence of a negative relationship.
Of course, a variety of factors determines how ESG factors influence investment performance. It is not certain that taking ESG criteria into account will have a uniform impact on portfolio performance. The results of
the Mercer review also show significant variations in ESG materiality across industrial sectors and may be misleading at aggregate levels. Many of the academic studies relied on specialist ESG research firms because corporations are not uniformly disclosing comprehensive information about ESG factors. Most of the studies focus
on the link between ESG and listed equity investments, but this is beginning to change, forthcoming papers
will focus on other asset classes as well.
30
1.6.3 Implementation
According to a study by Vigeo and Morningstar, SRI funds in Europe have grown considerably in number and
size over the past year, in spite of the fall-out from the financial crisis. The number of funds had increased
by the end of June 2009 to 683 (27% since last year) and assets under management rose by 9% to 53 billion.
These results, as well as other reports and articles show that socially responsible investing is more than a
trend and its implementation is increasing.
31
The latest EUROSIF study (2008) shows that total SRI assets under management have reached 2 665 billion
as of December 31, 2007 and represent as much as 17.5% of the asset management industry in Europe. This
corresponds to a remarkable growth of 102% since December 31, 2005. Eurosif’s study finds that the European
SRI market’s growth is driven by:
●
32
An increasing demand from institutional investors, for which responsible investment becomes a matter
of risk management, particularly around the area of climate change;
●
A further mainstreaming of Environmental, Social and Governance (ESG) considerations into traditional
financial services;
●
External pressure from NGOs and media;
●
A growing interest from individuals, particularly wealthy individuals.
The UK FairPensions’ survey among UK’s leading pension schemes also showed an encouraging level of ESG
awareness, although,according to FairPensions further work is needed in several areas. In particular, stated
interest in ESG is not always fully implemented into investment policy and monitoring, and some corporate
pension funds’ interest in corporate social responsibility by their mother corporation is not adequately matched by a responsible investment commitment within their own organisation.
33
The sustainability of institutional investment is linked to the performance of asset managers. The result of
FairPensions’ 2008 survey of UK asset managers’ performance revealed an overall increase since prior surveys,
34
but many have yet to achieve comprehensive integration of ESG issues.
The Fiduciary II report highlights the crucial role of investment management consulting firms in the investment chain. Because they help pension funds with selecting asset managers, they shape and transmit client
demand to asset managers and so have significant influence over what asset managers do. Whether asset
managers use their influence on companies they own on behalf of their clients (pension funds) depends on
whether investment consultants assess an asset manager performance in this area.
35
Within the consultancy industry, there seems to be a lack of ESG integration and confusion between ESG integration and traditional ethical investment approaches. They have not sufficiently developed measures to
assess asset managers’ competence on ESG integration and engagement. Consultants also don’t see their res-
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ponsibility to raise ESG consideration with trustees and have not embedded this in their investment manage36
ment contracts. However, ESG issues begin to form a piece of the investment consultants’ agenda due to growing investor demand. A Eurosif study on the integration of ESG issues by investment consultancies found
that 89% of investment consultants anticipate an increase of client interest when it comes to environmental,
social and governance issues.
37
Panellists at the European Pension Funds Conference in Frankfurt also made clear that pension funds highly
depend on the information of specialised research providers, and are not always satisfied with their services.
Some have called on SRI/ESG service and product providers to come up with innovative and customized products to help pension funds adapt their investments responsibly. Others think that ESG research providers
have to be more transparent about their methodology, which sometimes looks like a ‘black box’ to pension
funds and is hard to trust.
38
Finally, Fiduciary II also revealed that very few asset owner signatories to the UN Principles on Responsible
Investment (UNPRI) are in fact adopting all Principles and that more can and must be done by all institutional investors and their agents.
39
1.7 Dutch public attention for pension fund investment policies
Public awareness of pension fund responsible investment policy is steadily increasing. This trend was given an
impulse in 2006 following the behaviour of a few American hedge funds and their attempt to break up the
company Stork with the consequence of large loss of employment. To everybody’s dismay these hedge funds
were being substantially financed by Dutch pension funds.
40
Corporate Governance issues have been getting more attention over the years ever since the establishment
of the Code Tabaksblat, which in a revised form is now known as the Dutch Corporate Governance Code. But
institutional investors pay much less attention to social and environmental issues, as revealed by a 2006 VBDO
report into pension fund annual reporting.
41
Fortunately, in April 2006 the “Toekomstagenda Milieu”
(Environmental Future Plan) declared that the Dutch government means to “stimulate the development and
implementation of sustainability criteria for banks and investors (including pension funds)”.
42
In April 2007, the report “De Kracht van Pensioenfondsen” (The Strength of Pension Funds) by Dr. Harry
Hummels showed that “pension funds are including Corporate Responsibility as an important issue in their
investment policy”. However, the report also concludes: “Implementation is largely only just getting started.
Whoever takes a participant’s point of view must conclude in general that good intentions have not yet been
put into practice”.
43
This trend was given a major boost in March 2007, when the documentary “Het Clusterbomgevoel” (The
Cluster Bomb Feeling) was broadcasted on television by the programme Zembla. The documentary clearly showed that a number of large pension funds partly invest their capital in companies that pollute the environment and are involved in child labour and controversial weapons, such as the production of land mines and
cluster bomb ammunition. The reaction of many pension fund participants was one of dismay and various
media consequently focused their attention on pension fund investment policy.
The pension fund umbrella organisations took this opportunity to broaden discussions with their members
about responsible investment. Already in April 2007 the VB (the Dutch Association of Industry-wide Pension
Funds) had published a first manifesto, the Maatschappelijke belangenafweging en transparantie in het beleggingsproces. In November 2007 a commission - appointed by the umbrella organisation- published its final
report De gearriveerde Toekomst - Nederlandse pensioenfondsen en de praktijk van verantwoord beleggen.
The report offers pension fund boards a number of directives for the implementation of responsible investment.
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Trade unions, which are represented in most pension fund boards, once again focused their attention on the
subject. In November 2007, the FNV launched a 10-step plan for pension fund responsible investment. At the
same time, it called on pension funds to withdraw investments from Total, Chevron and SBM Offshore if these
companies would not cease activities in Burma and cut off connections with its military regime.
45
The VB in March 2008 published a small edition of interviews with prominent Dutch citizens on the social role
of pension funds and Corporate Responsibility. It wishes to remain engaged with pension funds and their social environment in discussions about the subject.
46
In January 2009 the launch of the Eerlijke Bankwijzer (Fair Bank Guide), an initiative of OxfamNovib, Amnesty
International, Milieudefensie (Friends of the Earth Netherlands) and FNV Mondiaal, gained a lot of attention
from the media. This website scores the responsible investment policy of banks and seems to be very successful three months afterwards. Most of the banks have improved their scores during the quarterly update.
The website was viewed by 50 000 visitors and almost 4 000 people wrote their bank with a request to explain
the bank’s low score.
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1.8 Relevant international initiatives
In order to encourage pension funds to maintain more sustainable investment policies, this section discusses
international initiatives concerning responsible investment by pension funds and other institutional investors.
It concerns initiatives by the government, the sector itself and societal institutions. The overview is not comprehensive, but does include the best-known global examples.
1.8.1 UN Principles for Responsible Investment
In May 1992, the UNEP (United Nations Environmental Programme) launched the UNEP Finance Initiative, that
organizes all kinds of supportive meetings and work groups for the signatories to effect the objective to “consider environmental, social and governance issues in their investment policy”. One of these work groups in
July 2004 focused explicitly on players in the investment sector: asset managers, investment funds and pension funds. The result was the UN Principles for Responsible Investment (UNPRI), launched by UN Secretary
Kofi Annan in April 2006.
48
As of July 2009, the UNPRI has been signed to by a total of 566 organizations. The signatories include 182
institutional investors (pension funds and insurance companies), 277 asset management companies and 107
service providers. Amongst the signatories are Dutch pension funds ABP, PFZW, PME and PNO Media and asset
managers ABN AMRO Asset Management, Robeco and SNS Asset Management.
49
In 2008, the Enhanced Analytics Initiative (EAI) merged with UNPRI. Prior to the alliance, the EAI, which numbered 30 pension funds, asset managers and brokerage arms of investment banks, carried out a bi-annual evaluation of investment research providers. This identified a recommended shortlist of those producing highquality extra-financial research to which buy-side members could direct a portion of their research commissions. Under the merger, the PRI will effectively adopt the EAI as its platform for promoting the first of its six
principles: to incorporate ESG issues into investment analysis and decisions.
50
1.8.2 Carbon Disclosure Project
The Carbon Disclosure Project is a well-coordinated international attempt by pension funds and other institutional investors to exert pressure in terms of climate policy on companies in which they invest. The Carbon
Disclosure Project aims to track greenhouse gas emissions by publicly listed companies and their efforts
towards reduction.
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1.8.3 Institutional Investor Group on Climate Change (IIGCC)
The Institutional Investor Group on Climate Change (IIGCC) is a network of pension funds and other institutional investors in the UK that stimulates analyses contributing towards climate change awareness, and also
stimulates investment markets and companies to reduce CO2 emissions. Similar groups exist in the United
States and Australia/New Zealand.
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1.8.4 United Nations Global Compact
The United Nations Global Compact was founded in July 2000 as an international initiative to join industry,
UN organizations, trade unions and community based organizations in promoting the ten principles of human
rights, employment conditions, environment protection and fighting corruption. The main purpose is the worldwide integration of the principles in industry and the promotion of all activities that aim to support UN resolutions. Global Compact principles are observed voluntarily.
53
1.8.5 Other international directives
Other international directives, guidelines and principles that pension fund can refer to in their responsible
investment policy include:
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International Corporate Governance Network - principles (ICGN principles);
●
OECD Principles of Corporate Governance;
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OECD Guidelines for Multinational Enterprises;
●
Global Reporting Initiative directive (GRI-directive);
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Universal Declaration of Human Rights;
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Convention on the Rights of the Child;
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Declaration on the Fundamental Principles and Rights to Work (by ILO);
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Rio Declaration on Environment and Development.
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2./ Research objective and method
2.1 Research objective
The objective of the ‘Benchmark Responsible Investment by Dutch Pension Funds 2009’ carried out by the
VBDO in cooperation with research consultancy Profundo, is to give pension funds and their participants
insight into the current status of (socially) responsible investment among the largest Dutch pension funds. This
comparative research offers pension funds an impartial instrument with which they may assess the extent to
which their (socially) responsible investment policy adequately reflects their social responsibilities and how
it compares to their competitor’s policies. The report is of equal value to their participants who in general
are not able to choose between the various pension funds.
In 2007, the VBDO published the first ‘Benchmark responsible investment by Dutch Pension Funds and Pension
Insurance Companies’. The underlying report is the third, focusing only on pension funds after the publication of
a separate ‘Benchmark responsible investment by Dutch Insurance Companies’ in September 2009. In the end, the
VBDO aims to ensure that as many Dutch pension funds as possible develop a sound (socially) responsible investment policy and that they implement this policy in a consequent way using various instruments and account for
it in a clear and transparent manner.
2.2 Researched pension funds
The largest pension funds in the Netherlands have been selected for participation in this survey on the basis
of the number of participants and their invested capital. In 2009 another 15 pension funds were included, of
which 1 participated voluntarily. This adds up to a total of 51 researched pension funds, which includes the
following types of pension funds:
●
27 industry-wide pension funds
●
2 occupational pension funds
●
22 corporate pension funds
2.3 Research period
The “Benchmark responsible investment by Dutch pension funds 2009” covers the period 2008 to midway 2009
(July 1st, 2008 - June 30th, 2009).
2.4 Gathering information
Information pertaining to the (socially) responsible investment policy of Dutch pension funds has been extracted from publications (annual reports, websites and other media) by these pension funds themselves.
Moreover, a questionnaire was sent to each of the researched pension funds in which details were requested
in relation to the assessment criteria as mentioned in paragraph Error! Reference source not found.. The
information gathered from these sources was used to compose a profile for each of the pension funds in which
all assessment criteria are covered. These profiles were returned to the pension funds for verification and,
where necessary, for corrective purposes. The profiles are included in Chapter 4 of this report.
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2.5 Advisory panel
Prior to publication, the VBDO always organizes a session in which a number of experts from the pension sector are given the chance to evaluate the benchmark. In undertaking this benchmark, the VBDO does not necessarily wish to establish the frontrunners and the followers in the area of responsible investment. Rather, it
wishes to provide the means by which pension funds are able to practice responsible investment. By consulting with an advisory panel, the VBDO wishes to ensure that the benchmark stays as close as possible to the
reality for pension funds. The purpose of the advisory panel is to discuss the benchmark methodology and to
see where corrective adjustments can be made, be it in the current benchmark or future editions.
The advisory panel for the 2009 edition of the benchmark included representatives from all three pension fund
types (industry-wide, occupational, and corporate), as well an asset manager and one of the three pension
fund umbrella organisations.
Participants raised a number of issues during the advisory panel meeting. The VBDO, in the way that it scores the pension funds, places a lot of emphasis on transparency while the content of the policy is perhaps
more important. This was illustrated using the exclusion policy criterion, where the highest scores are awarded to those pension funds publishing a list of excluded companies.
Another issue raised had to do with the vast difference in size between the surveyed pension funds. The comment was made that all pension funds are scored the same way, regardless of differences in size. This while
a smaller pension fund can have a lot more difficulty implementing a responsible investment policy, as it is
unable to obtain a separate mandate from its asset manager. At the same time, the transparency in outsourcing criterion does not provide insight into how much of the asset management is carried either internally or
externally. The comment was also made that larger pension funds can be expected to score better as they
also have more resources available to them. The VBDO is aware of this difference in size, and has as much as
possible tried to nuance the scores.
When discussing the engagement criterion, the suggestion was made that the VBDO should include engagement with asset managers. Many pension funds invest a great deal of their capital in pooled funds, making it
impossible to engage with companies. These pension funds are, however, able to engage with the asset managers of the pooled funds in order for them to consider ESG-criteria in their selection and engagement processes. The VBDO found this a very worthwhile suggestion and will try to include this type of engagement in
future editions of the benchmark.
The VBDO also informed the advisory panel about the planned significant changes in future editions of this
survey. The changes in methodology are meant to reflect the fact that responsible investment is not limited
to one or two asset classes. A number of members suggested having a similar advisory panel when finalizing
these changes. Finally, it was also suggested to carry out the survey and release the results earlier in the year.
This because pension funds generally begin evaluating and changing their investment policies in the summer
and formalize the contracts with asset managers and other service managers in November and December. The
VBDO greatly appreciates these suggestions and will look into implementing them.
2.6 Assessment criteria
The (socially) responsible investment policy of the 51 Dutch pension funds are researched on the basis of nine
assessment criteria, spread out over three categories:
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Policy
●
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Implementation:
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ESG-criteria for exclusion of investments (negative selection)
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ESG-criteria for the selection of investments (positive selection)
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Engagement
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Voting policy
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Sustainable project financing
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Accountability:
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2.7 Rating system
2.7.1 Scores and weighting percentages
Each pension fund is assigned a score between 1 and 5 points (whole numbers only) for each of the assessment criteria as described in paragraph 4.8. If a pension fund provided no answer and no answers were found
in other sources, no points were assigned.
The scores of these nine assessment criteria were added up using weighting percentages to reach an overall
score for all pension funds included in this research. Not all assessment criteria have been weighted equally,
but the individual weighting percentages of all assessment criteria add up to a total of 100%. The overall score
for each pension fund therefore lies between 0 and 5 points as well.
The three categories have been assigned the following weighting percentages:
●
The responsible investment policy itself (1 criterion): 20%
●
The instruments, which have been prepared for policy implementation (5 criteria): 60%
●
The measure of accountability towards participants and others who are involved (3 criteria): 20%
The emphasis in this assignment of weighting percentages lies on the use of instruments, because the practice of responsible investment is considered more important than written intentions. The formulation of responsible investment policy is the most heavily weighting individual assessment issue (20% of the final score).
On the other hand, five assessment criteria are involved, each contributing 12% of the final score. This choice was made in order to encourage pension funds that have only recently drawn up a responsible investment
policy and are now in the process of defining instruments. At the same time, reporting of the implemented
policy es weighted the same as the formulation of the policy itself.
2.7.2 Public availability
The first assessment criterion concerns a ‘publicly available policy document’ in which the pension fund
should explain its principles, objectives, criteria and scope of its socially responsible investment policy in
general and/or its specific instruments. These documents tend to appear in various forms and their public
availability varies per company.
In this report, with the notion ‘public’ is meant that the document is available on the website of the organization or will be send to third parties on request. Internal documents that are send to the VBDO or Profundo
as part of this assessment can be described in the profile of the organization but will not be considered as
publicly available. Because of this, the rating will be lower than can be expected of a policy that is complete and carefully prepared.
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When the socially responsible investment policy consists of multiple and separate documents, is described on
various pages of the website or the annual report, together these documents will be considered as the policy of the organisation. For transparency purposes the most important thing is that the policy is publicly available and accessible.
2.8 Indicators
The following sections explain the indicators used to assess the nine assessment criteria.
2.8.1 (Socially) responsible investment policy
The implementation of a socially responsible investment policy requires in the first place that it is defined as
clearly as possible in a publicly available document. In doing so, it is important to provide a clear description
of the policy objectives and basic principles referring to recognized legislation and international treaty standards, such as the UN Declaration on Human Rights, ILO conventions and the UN Global Compact. Note that
the UN Principles for Responsible Investment are not considered as international standard but as an initiative
for investors to declare their intention to integrate ESG criteria.
The policy document should also preferably provide insight into the use of policy instruments. As pension
funds spread out their investment capital over various investment categories (shares, bonds, private equity,
real estate, etc.), responsible investment policy should relate to all these categories, and specific criteria
and instruments per category should be defined. Practical experience shows that pension funds more often
have a policy for equity investment than for other categories. This has been taken into consideration in the
ratings.
Indicators:
●
publicly available policy document
●
scope of the policy (investment categories)
●
whether the policy is based on clear principles and directives (e.g. international treaties) and takes
deliberately chosen social and environmental issues into consideration
●
does the policy clarify the use of instruments
Ranking:
5 points
Publicly available policy document considers deliberately chosen social and environmental
issues, is based on clear principles and directives, clarifies the use of instruments and
covers all investment categories.
4 points
Publicly available policy document considers deliberately chosen social and environmental
issues, is based on clear principles and directives, clarifies the use of instruments and
covers multiple investment categories.
3 points
Publicly available policy document that considers deliberately chosen social and
environmental issues and is based on clear principles and directives, covers only one
investment category AND clarifies the use of instruments
2 points
Publicly available policy document that considers deliberately chosen social and
environmental issues and is based on clear principles and directives, but covers only one
investment category
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1 point
No policy document
0 points
No answer was provided
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2.8.2 ESG-criteria for exclusion of investments (negative selection)
The products and processes of some companies are at such odds with international agreements and treaties
that they should be excluded from the investment portfolio. Merely taking general issues such as human rights
and the environment into consideration offers insufficient means of judgment for which companies should be
excluded. Investors often mention their consideration of ESG criteria in selecting investments (ESG stands for
Environment, Social and Governance), but these criteria can be used for exclusion also. Being more explicit
about ESG-criteria for exclusion is therefore rated positively, especially when more relevant social and environmental issues are considered. Additional clarity is provided by continuously updating a list of excluded
companies. Actually, the exclusion policy should be based not only on shares but also on bonds and preferably index fund, hedge fund, private equity investments etc. Moreover, an exclusion policy should be linked to
other instruments, such as engagement, instead of forming a independent policy. This element has been included in the assessment of company engagement.
Indicators:
●
publicly available document that clarifies exclusion policy
●
list of excluded companies
●
detailed formulation of one or various exclusion criteria (such as controversial weapons, investments
in specific countries, child labour, serious environmental pollution)
Ranking:
5 points
Publicly available and clearly defined exclusion policy concerning various social and
4 points
Publicly available and clearly defined exclusion policy concerning various social and
environmental issues with a list of excluded companies
environmental issues or an exclusion policy concerning one issue with a list of
excluded companies
3 points
Publicly available and clearly defined exclusion policy concerning one issue
2 points
Vaguely defined exclusion policy
1 point
No exclusion policy
0 points
2.8.3 ESG-criteria for the selection of investments (positive selection);
Even when the excluded companies (see paragraph 2.8.2) are left out, large differences in terms of corporate responsibility sometimes remain between companies in which pension funds (may) invest. Where one company may only abide by the current environmental and social laws of the country in which it operates, the
other may pursue high social and environmental standards in every country in which it is active. Pension funds
should consider this in making investment policy and should give preference to companies that perform well
in relation to corporate responsibility.
In contrast with sustainable project financing (see criterion 4.8.6), the issue here is investments in publicly
listed companies. When these companies are given preference by investors, they are rewarded for the fact
that they are able to attract capital more easily (and therefore at a lower cost). Investors, in following this
policy, often mention their consideration of ESG-criteria in selecting or excluding investments (ESG stands for
Environment, Social and Governance). In the case of positive selection, this strategy is also referred to as the
best-in-class approach. However, other strategies such as stock picking or a fundamental analysis of investments on ESG criteria can also be seen as positive selection.
ESG criteria can be applied to various asset classes (equity, bonds, hedge funds, etc.). It requires information
on how the various companies deal with sustainability and corporate responsibility. This sort of information
can be purchased by investors from specialized research providers. A different approach is taken by the EAI
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(now merged with the UN PRI), a coalition of asset management companies and pension funds that aim to
stimulate share analysts to pay more attention to ESG criteria in their analyses.
Investors who have signed the United Nations Principles on Responsible Investment pledge their commitment
to the inclusion of ESG-criteria into their investments. The UN PRI, however, makes no mention about how
investors should interpret that, nor which ESG issues should be considered. Such choices and principles must
be incorporated into the responsible investment policies of all pension funds.
Indicators:
●
signatory to the UN Principles for Responsible Investment
●
use of ESG criteria in specially developed funds or a specific asset class with, for example a best-in-class
●
publicly available document containing clearly defined ESG criteria
●
the purchase of responsible investment analyses and/or participation in, amongst other things, the EAI
approach, stock picking or a fundamental analysis for portfolio selection
(now merged with the UN PRI)
Ranking:
5 points
ESG criteria are applied to the selection of investments within specially developed funds,
is based upon a publicly available document containing clearly defined ESG criteria applied
to investments AND give an overview of concrete activities carried out in order to weight
ESG criteria such as, for example, the purchase of responsible investment analyses and EAI
participation
4 points
ESG criteria are applied to the selection of investments within specially developed funds is
based upon a publicly available document containing clearly defined ESG criteria OR give
an overview of concrete activities carried out in order to weight ESG criteria such as, for
example, the purchase of responsible investment analyses and EAI participation
3 points
ESG criteria are applied to the selection of investments within specially developed funds
2 points
Signing of the UNPRI or a general statement that ESG criteria are included in selecting
investments
1 point
No ESG criteria applied to the selection of investments
0 points
2.8.4 Engagement
Pension funds and insurance companies can actively exert influence on companies in which investments are
made by entering into dialogue with them. If their policies are at odds with pension fund policy, they should
to some extent use their influence to alter the conduct of companies in which investments are made, all
depending on the size of investment. Pension funds that have formulated an engagement policy and actively
seek dialogue with companies outside shareholder meetings receive higher scores. Engagement can be pursued by pension funds directly or in collaboration with other pension funds and institutional investors.
Engagement policy is further improved if pension funds place companies on the exclusion list where engagement has had no effect.
Indicators:
●
publicly available engagement policy clearly outlining deliberately chosen social and environmental issues
●
reporting on engagement activities
●
link to exclusion policy (when engagement shows no results)
- regular dialogue with companies
Ranking:
5 points
The pension fund has formulated an engagement policy clearly outlining deliberately
chosen social and environmental issues and regularly engages companies in dialogue.
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The pension fund also reports on engagement activities and links this reporting to its
exclusion policy
4 points
The pension fund has formulated an engagement policy clearly outlining deliberately
chosen social and environmental issues and regularly engages companies in dialogue. The
pension fund also reports on its engagement activities
3 points
The pension fund occasionally engages companies in dialogue and is clear about the
criteria on which priorities are based OR reports on its engagement activities
2 points
The pension fund occasionally engages companies in dialogue, but is not clear about the
criteria on which priorities are based AND does not report on its engagement activities
1 point
No engagement policy
0 points
2.8.5 Voting policy
Pension funds and insurance companies can actively exert influence on companies in which they invest by voting
during shareholder meetings. Many pension funds have taken to actively voting at shareholder meetings, but their
voting policy is limited to subjects regarding corporate governance. This might push companies towards a better
sustainability policy, but that is in itself not enough. A clearly defined voting policy is required, one that explicitly emphasizes social and environmental issues. By introducing or supporting sustainability resolutions, companies can be pushed towards improvement and corrective action. Using voting policy to positively affect company
conduct and criticize non-sustainable actions is viewed favourably.
Indicators:
●
publicly available voting policy document regarding to voting defining starting points, principles and
●
support of resolutions to stimulate corporate responsibility and criticism of unsustainable conduct
●
active formulation and putting to a vote of resolutions in order to promote corporate responsibility and
directives on social, environmental and corporate governance issues
criticism of unsustainable conduct
●
publicly available report of voting behaviour
Ranking:
5 points
The pension fund has an active voting policy on social, environmental and corporate
governance issues, actively formulates and put into vote resolutions and supports other
resolutions in favour of promoting Corporate Responsibility and criticism of non-sustainability
conduct and is publicizing (in annual report or website) presence and voting behaviour during
shareholder’s meetings.
4 points
The pension fund has an active voting policy on social, environmental and corporate
governance issues, supports resolutions in favour of promoting Corporate Responsibility and
criticism of non-sustainability conduct and is publicizing (in annual report or website)
presence and voting behaviour during shareholder’s meetings.
3 points
The pension fund either has an active voting policy on corporate governance issues and is
publicizing (in annual report or website) presence and voting behaviour during shareholder’s
meetings or has an active voting policy that explicitly includes social and environmental
issues
2 points
The pension fund has an active voting policy that only includes corporate governance issues.
1 point
The pension fund has no active voting policy.
0 points
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2.8.6 Sustainable project financing
Sustainable project financing implies active investments that are made in companies or projects which are
leaders in the field in terms of sustainability or clearly offer added value. Often these companies are not
listed on the stock exchange and this type of investments is therefore considered as private equity. Examples
are investments in sustainable energy sources, innovative clean technology, cheap medicine against tropical
diseases, microcredit and sustainable forestry.
Although such initiatives can yield considerable profits, they are not considered for regular financing because investment return time horizon is considered by banks to be too long. Pension funds and insurance companies with their longer time horizons are very well equipped to make such investments, enabling them at
the same time to fulfil their social responsibility as well.
A well-balanced investment mix should allow between 2 and 5% of their capital to be used by pension funds
and insurance companies for sustainable project financing. However, this is difficult for the large pension
funds to realize in the short term, as identifying and charting sufficient options for sustainable project financing is a lengthy process. This is why at this time the assessment is limited to absolute investment figures.
Indicators:
●
publicly available clearly defined policy for sustainable project financing
●
level of sustainable project financing is expressed in Euros or as a percentage of invested capital
●
description of the various sustainable project financing projects
Ranking:
5 points
The pension fund has a clearly defined sustainable project investment policy and invests in
excess of  2,5 billion or more than 5% of its capital in sustainable funds/companies and
provides information on projects and investment size
4 points
excess of  1.0 billion or more than 2% of its capital in sustainable funds/companies and
provides information on projects AND investment size
3 points
excess of  0.5 billion or more than 1% of its capital in sustainable funds/companies and
provides information on projects OR investment size
2 points
The pension fund has a clearly defined sustainable project financing policy, but invests less
than 1% of its capital in sustainable funds/companies or does not provide information on
projects and investment size
1 point
No sustainable project financings
0 points
2.8.7 Transparency in outsourcing
Many pension funds and pension insurance companies outsource (a part of) their asset management and responsible investment activities. This raises questions as to the measure of control maintained with regards to
responsible investment policy implementation. Are the external asset managers or other parties to whom activities are outsourced capable of investing responsibly and acting in accordance with the pension funds’ choices and priorities for responsible investment?
Providing insight into asset management outsourcing and responsible investment activities is rated positively.
In addition, clarity must be provided as to how external parties are committed to the pension funds’ responsible investment policy. An additional point is given if the pension fund selects asset managers based on their
expertise in using ESG criteria in investment selection.
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Indicators:
●
clarity on which part of asset management and responsible investment activities is outsourced
●
overview of external asset managers and other parties used in outsourcing
●
formalization of external party commitment to responsible investment policy
●
selection of external parties based on their ESG criteria expertise
Ranking:
5 points
The pension fund is clear about which external party is executing the fund’s responsible
investment activities, provides a comprehensive overview of external parties, formalizes
external party commitment to its responsible investment policy and selects external
parties based on ESG criteria expertise
3 points
investment activities, provides a comprehensive overview of external parties and either
formalizes external party commitment to its responsible investment policy; or selects
external parties based on ESG criteria expertise
2 points
investment activities and either provides a comprehensive overview of its external asset
managers or formalizes external party commitment to its responsible investment policy
1 point
investment activities or provides a comprehensive overview of its external asset managers
0 points
The pension fund provides no information on outsourcing
N/A
No outsourcing
2.8.8 Dialogue with society
Responsible investment is not just an academic activity. It is based on acknowledging the social responsibility that
pension funds and insurance companies bear in their role of institutional investors. This implies interaction with
both participants and pensioners as well as society in general. The fund needs to gain insight into what it is that
society requires from it, how best to cooperate and how best it can assume its responsibilities. Seeking constructive dialogue with pension fund participants and beneficiaries, academics, politics, civil society institutions,
media and others on the various corporate responsibility issues is therefore viewed positively.
Indicators:
●
extent of dialogue with representatives from academia, politics, civil society institutions, media
●
extent of dialogue with participants and policy holders
●
initiating joint social projects with participants and insurance holders
●
reporting on dialogues with participants and society
and others
Ranking:
5 points
The pension fund seeks social dialogue concerning corporate responsibility issues with
participants and other representatives of society, leading a demonstrable impact on
investment policy
4 points
3 points
participants and other representatives of society
participants
2 points
The pension fund occasionally seeks dialogue with participants
1 point
No dialogue
0 points
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2.8.9 Reporting on responsible investment policy
Accountability for company and organization policy is paramount. Consumers and civil society have a right to
information on companies’ and organizations’ involvement in society so that it can be taken into account
when making decisions. Pension funds must offer insight into the basis and criteria of their responsible investment policy as well as the applied instruments and results. There should be an overview of the investments
in companies made by the pension fund with premiums of their participants available to these participants.
Pension funds should be able to publish an overview of equity investments and other investments on their
websites. When the pension premiums from a company with which a collective pension contract has been
agreed can be invested in different ways, the pension fund should individually inform the participants concerning the investments.
Transparency of all pension funds should preferably be applied to all investment categories.
Indicators:
●
publicly available overview of applied instruments (exclusions, integration of ESG criteria, voting policy,
●
publicly available overview of all companies, such as proxy voting reporting records, within one or more
engagement, sustainable project financing) and results
investment categories in which pension premiums are invested
Ranking:
5 points
The pension fund publishes a detailed overview of companies within multiple investment
categories in which investments are made. In addition, they report in detail on the applied
instruments and results.
4 points
The pension fund publishes a detailed overview of companies within one investment
category in which investments are made and reports on all applied instruments and results.
3 points
The pension fund publishes a detailed overview of companies within one investment
category in which investments are made and partially reports on applied instruments.
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2 points
The pension fund only partially reports on applied instruments.
1 point
No reporting on activities with regards to responsible investment
0 points
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objective and method
In this chapter, the results of this research into the responsible investment policies of Dutch pension funds
are examined. Section 3.1 covers the participation rate and provides insight into the extent of the participation. Sections 3.2, 3.3 and 3.4 break down and analyse the scores for each of the three categories: policy,
implementation, and accountability.
3.1 Participation rate
The 2009 edition of this benchmark surveyed 51 pension funds. Fifty pension funds were selected by the
VBDO, and one pension fund asked to be included in the selection. This total is up from the previous totals
of 30 and 43 in 2007 and 2008, respectively.
The participation rate has, despite the increase in the number of surveyed pension funds, increased as well.
This
is shown
below
in 2007-2009
Table 1.
Table1:
Response
rate
Year
Participation rate
%
2007
22/30
73
2008
34/43
79
2009
43/51
84
A total of 43 pension funds participated by either filling in the questionnaire or responding to the profile that
the VBDO sent to each of them. A large number of pension funds took the opportunity to both fill in the questionnaire as well as respond to the profile. Table 2 below shows the extent to which the 51 surveyed pension
funds responded.
Table 2: Total and type of response per pension fund
Industry-wide pension funds
1
ABP
2
Bedrijfspensioenfonds Bakkers
3
Bedrijfspensioenfonds Landbouw
4
Bedrijfstakpensioenfonds Bouw
5
Bedrijfstakpensioenfonds Detailhandel
6
Bedrijfstakpensioenfonds Groente en Fruit
7
Bedrijfstakpensioenfonds Levensmiddelen
8
Bedrijfstakpensioenfonds Meubels
9
Bedrijfstakpensioenfonds Schilders
10
Bedrijfstakpensioenfonds Schoonmaak- en
Overall
Participation
Response to
questionnaire
Response to
profile
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
Glazenwassersbedrijf
11
Bedrijfstakpensioenfonds Vervoer
12
Bedrijfstakpensioenfonds Zorgverzekeraars
13
Molenaarspensioenfonds
14
Pensioenfonds Architectenbureaus
15
Pensioenfonds Horeca en Catering
16
Pensioenfonds Medewerkers Apotheken
17
Pensioenfonds Metaal en Techniek
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Table 2: Total and type of response per pension fund
Industry-wide pension funds
18 Pensioenfonds Openbaar Vervoer
19 Pensioenfonds PNO Media
20 Pensioenfonds Productschappen
21 Pensioenfonds voor de Grafische Bedrijven
22 Pensioenfonds voor de Metalektro
23 Pensioenfonds voor de Woningcorporaties
24 Pensioenfonds Werk en (re)Integratie
25 Pensioenfonds Wonen
26 Pensioenfonds Zorg en Welzijn
27 Spoorwegpensioenfonds
Overall
Participation
Response to
questionnaire
✔
✔
Response to
profile
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
Occupational pension funds
28 Pensioenfonds Medisch Specialisten
29 Pensioenfonds voor Huisartsen
30 Corporate pension funds
31 ABN AMRO Pensioenfonds
32 Ahold Pensioenfonds
✔
33 Algemeen Pensioenfonds KLM
34 ARCADIS Pensioenfonds
35 Heineken Pensioenfonds
36 Pensioenfonds Akzo Nobel
✔
✔
✔
✔
✔
37 Pensioenfonds Ernst & Young
38 Pensioenfonds Fortis Bank Nederland
39 Pensioenfonds Gasunie
40 Pensioenfonds Hoogovens
41 Pensioenfonds IBM Nederland
42 Pensioenfonds ING
43 Pensioenfonds KPN
44 Pensioenfonds Stork
45 Pensioenfonds TNO
46 Pensioenfonds TNT
47 Pensioenfonds UWV
48 Pensioenfonds Volker Wessels
49 Pensioenfonds Wolters Kluwer Nederland
50 Philips Pensioenfonds
51 Rabobank Pensioenfonds
52 Shell Pensioenfonds
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
✔
Total
43
35
38
Response rate
84%
69%
75%
Thirty-five pension funds responded to the questionnaire that was sent in the beginning of September 2009.
Upon receiving a profile, another 8 pension funds that did not complete a questionnaire responded. This
means that a total of 43 pension funds participated, a response rate of 84%.
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3.2 Results: Responsible investment policy
Table 3 shows that 37 of the 51 surveyed pension funds (73%) now have a responsible investment policy.
Another 3 pension funds indicate that a policy is in development. When comparing this to previous years, it
is clear that progress continues to be made. Last year’s report showed that 21 of 43 pension funds (49%) had
a responsible investment policy, while 13 pension funds were developing one.
At the same time, only 6 pension funds have a policy that covers environmental and social issues, is based on
international principles and directives, and also covers all asset classes. This is means that the pension funds
receiving a top score for this criterion is the same total as last year.
When looking at the asset classes covered by the developed responsible investment policies, pension funds
can be broken down into 4 groups:
• 9 pension funds cover all asset classes
• 7 pension funds cover multiple asset classes
• 12 pension funds cover one asset class (generally equity)
• 9 pension funds are unclear about it
This means that more than half of the policies are limited to one asset class or do not provide insight into the
asset classes covered.
Industry-wide and occupational pension funds are clearly ahead of corporate pension funds. The average score
for the first group is 3.1, with corporate pension funds clearly lagging behind with a score of 1.9. In terms of
size, pension funds with more than 10 billion in invested capital score much higher(3.9) than those under
this amount (2.2 for less than 1 billion, 2.4 for those between 1 billion and 10 billion).
Finally, pension funds previously surveyed had an average score of 3.0 while those pension funds new to the
survey scored 1.6. The pension funds included for the first time were also smaller pension funds, a correlation
that must not be overlooked when analysing these results.
Table 3: Responsible investment policy
Pension fund
1 Pensioenfonds Metaal en Techniek
Stage of
policy
developed
all
5
developed
all
5
developed
all
5
4 ABP
developed
all
5
5 Bedrijfstakpensioenfonds Vervoer
developed
all
5
developed
all
5
developed
multiple
4
developed
multiple
4
developed
multiple
4
developed
multiple
4
developed
multiple
4
developed
one (equity)
4
developed
one (equity)
4
developed
one (equity)
4
15 Bedrijfstakpensioenfonds Groente en Fruit
developed
unclear
4
16 Pensioenfonds Medewerkers Apotheken
developed
all
3
developed
all
3
3.3 Results: Implementation
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Table 3: Responsible investment policy
Pension fund
Stage of
policy
developed
multiple
3
19 Bedrijfstakpensioenfonds Schoonmaak- en Glazenwassersbedrijf
developed
one
3
developed
one
3
21 Bedrijfstakpensioenfonds Bouw
developed
one (equity)
3
22 Bedrijfstakpensioenfonds Detailhandel
developed
one (equity)
3
developed
one (equity)
3
developed
one (equity)
3
25 Bedrijfstakpensioenfonds Levensmiddelen
developed
unclear
3
26 Pensioenfonds Horeca en Catering
developed
unclear
3
developed
all
2
developed
multiple
2
29 Bedrijfspensioenfonds Landbouw
developed
one
2
30 Bedrijfstakpensioenfonds Schilders
developed
one
2
developed
one (equity)
2
32 Bedrijfstakpensioenfonds Zorgverzekeraars
developed
unclear
2
33 Molenaarspensioenfonds
developed
unclear
2
developed
unclear
2
developed
unclear
2
developed
unclear
2
developed
unclear
38 Pensioenfonds Architectenbureaus
in development none
1
in development none
1
in development none
1
none
1
none
2
42 Bedrijfspensioenfonds Bakkers
none
none
1
43 Bedrijfstakpensioenfonds Meubels
none
none
1
none
none
1
none
none
1
none
none
1
none
none
1
none
none
0
none
none
0
none
none
0
none
none
0
3.3 Results: Implementation
A pension fund’s responsible investment policy can be implemented using a number of different instruments.
Some instruments are more attainable and effective for larger pension funds than smaller ones. Engagement,
for example, can be done more easily by large pension funds that do not have to invest the majority of their
equity in pooled funds. It also tends to be more effective, as larger equity investors are taken more seriously. Smaller pension funds are, however, able to join alliances and make use of service providers that conduct
engagement activities on their behalf.
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A solid and effective responsible investment policy will always make use of a number of different instruments:
exclusions, engagement, voting and sustainable project financing. It is not sufficient to implement one or two
instruments; only making use of an exclusion policy does not allow investors to wield their influence as shareholders without a voting policy. These instruments can also be complementary to each other and work together. An effective engagement policy, for example, can be linked to the exclusion policy.
3.3.1
Negative selection (exclusions)
When implementing a responsible investment policy, most pension funds formulate and implement an exclusion policy. This means that pension funds exclude companies (and countries) that flagrantly and systematically violate (inter)national principles and directives in environmental and social area from their equity (and
fixed interest) portfolios.
Table 4 shows that 33 of 51 pension funds (65%) have an exclusion policy. Last year, 20 pension funds indicated that they had an exclusion policy. There is quite a wide range, however, in these policies when it comes
to the number of criteria covered as well as the public availability of the exclusion list.
The majority of pension funds that have an exclusion policy apply it for one criterion (controversial weapons):
- 19 pension funds have one exclusion criterion
- 12 pension funds have multiple exclusion criteria
- 2 pension funds provide limited clarity
A comprehensive exclusion policy should take not only controversial weapons into consideration; companies responsible for systematic serious violations of human rights or environmental laws should also be excluded. That 12
pension funds consider multiple exclusion criteria is a small step in the right direction, as the total was 7 in 2008.
When it comes to public availability of the exclusion list, 14 pension funds publish a list of excluded companies,
while one pension fund makes the list available on request. This is, once again, a small increase from last year.
Table 4: Exclusion policy of pension funds
Pension fund
Number
of
criteria
Description
of criteria
Publicly Score
available
list
multiple
controversial weapons, non-compliance Global
Compact, activistic hedgefunds
controversial weapons, violation of human rights,
environmental pollution
controversial weapons, violation of
human rights, environmental pollution,
production
and trade of fur
controversial weapons, violation of human rights,
environmental pollution
controversial weapons, violation of human rights
and use of child labour
non-compliance international
conventions
controversial weapons, non-compliance Global
Compact (not on the list)
controversial weapons, corruption, violation of
human rights, environmental pollution
controversial weapons, human rights, working
conditions, environmental issues
controversial weapons, forced child labour,
activities in Birma or Colombia
no
4
11 ABP
one
controversial weapons
yes
4
12 Bedrijfstakpensioenfonds Schoonmaak-
one
yes
4
one
yes
4
one
yes
4
one
yes
4
one
controversial weapons,
Dutch metalektro companies
no
4
one
yes
4
one
on request 4
multiple
multiple
multiple
multiple
multiple
multiple
multiple
8 Pensioenfonds TNO
multiple
multiple
yes
5
yes
5
yes
5
yes
5
no
4
no
4
yes
4
no
4
no
4
en Glazenwassersbedrijf
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Table 4: Exclusion policy of pension funds
Pension fund
Number
of
criteria
one
Description
of criteria
Publicly Score
available
list
yes
4
one
controversial weapons and non-compliance
Global Compact (not on the list)
yes
4
one
no
3
multiple
controversial weapons, violation of human rights
and fundamental workers' rights
no
3
one
no
3
one
no
3
one
no
3
one
no
3
one
no
3
one
no
3
one
no
3
one
no
3
multiple
corruption, violation of human rights,
labour rights, environmental pollution,
no
2
none
none
no
2
unclear
unclear
no
2
3.3.2
Positive selection
When comparing the scoring for this criterion, it is clear that this has been changed in comparison to last year.
Some of the feedback received over the course of the past year as well as the experience with publishing a
similar benchmark for Dutch insurance companies led the VBDO to award points for separate funds within the
equity portfolio that incorporate a form of positive ESG selection. This positive selection is usually in the form
of a best-in-class approach, but can also take place in another manner.
Positive selection is an important element in a comprehensive implementation of the responsible investment
policy. Investors can reward companies by selecting those that take their environmental and social responsibility seriously. In this way, these companies are able to attract capital in an easier (and cheaper) manner.
Table 5 shows the scores for positive selection as well as all the implementation criteria scores. A total of 15
pension funds incorporate positive selection and/or undertake concrete activities to incorporate ESG criteria
into the selection process. This can take the form of having a team dedicated to ESG analysis of companies
or buying sustainability analyses.
3.3.3
Engagement
Another element in a comprehensive implementation of the responsible investment policy is engagement.
This tool can be used to push companies who are not on the leading edge of sustainability to take steps in the
right direction. Large pension funds are very well able to undertake these activities on their own while smaller pension funds can join forces with other institutional investors or make use of external parties to do it for
them.
When it comes to engagement, pension funds have a taken the largest step forward for this element of implementation. In the first place, a total of 10 pension funds score 5 points. This means that these funds have a
clear policy outlining deliberately chosen social and environmental issues, regularly engage with companies,
link this process with possible exclusion and also report on the results. A further 5 pension funds actively
engage with companies and report on these activities. At the same time, more pension funds have started
making use of the engagement instrument than any other instrument.
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Voting policy
As active owner, pension funds are also able to exercise influence over companies in their portfolio by making
use of their voting power. Many institutional investors pay a great deal of attention to the G of ESG, but lack
policies concerning environmental and social issues. Pension funds can pay attention not only to financial or
governance issues when voting at general meetings, they can also vote on sustainability issues raised by the
board of a company other investors. It is also possible to go a step further and introduce shareholder resolutions to raise awareness among the board members and other investors.
Twelve pension funds indicated that they had a voting policy that included environmental and social issues
and also reported on their voting behaviour. In addition to this, a large number of pension funds (16) had a
voting policy including environmental and social issues but did not report on their behaviour or had a voting
policy centred around corporate governance issues and published their behaviour.
3.3.5
Sustainable project financing involves pension funds investing in companies or projects that are leading in
terms of sustainability or clearly offer added value. These companies are often not publicly traded and are
therefore considered private equity. Examples are investments in sustainable energy sources, innovative clean
technology, cheap medicine against tropical diseases, microcredit and sustainable forestry.
Although such initiatives can yield considerable profits, they are not considered for regular financing because investment return time horizon is considered by banks to be too long. Pension funds with their longer time
horizons are very well equipped to make such investments, and these investments are an important final element in a comprehensive implementation of the responsible investment policy.
This instrument continues to have relatively lower scores, even though a number of pension funds have actively sought out and invested in these companies or projects. Microfinancing companies or projects, in particular, seem to be a popular choice when investing.
It is, admittedly, very difficult for a pension fund to score 5 points for this criterion. Some pension funds are
mentioned that even relatively small investments of 20-30 million required a great deal of work to complete. This effort is not reflecting in the scoring. At the same time, however, the score for this criterion does
provide a good indication of which pension funds are making serious work of investing in companies or projects that contribute to a more sustainable world.
3.3.6
Total score implementation
Table 5 provides a summary of the scores assigned to all pension funds. The total score for implementation is
a weighted average of the five criteria. Pensioenfonds Zorg en Welzijn lead the way with 4.6 out of 5, with
ABP close behind at 4.4. The top 5 pension funds are rounded off by three pension funds with the same score
of 3.8 (Pensioenfonds Metaal en Techniek, Pensioenfonds PNO Media and Pensioenfonds voor de Metalektro).
The reason these three pension funds have a lower total is that each of them score 2 points or less for one of
the five criteria.
The highest scoring corporate pension funds are KPN (3.2), TNT (3.2), Shell (3.0), Philips (2.4), and Rabobank (2.4).
These pension funds have all taken steps forward when comparing them to last year’s results but lag significantly
behind industry-wide pension funds. The two occupational funds (Pensioenfonds Medisch Specialisten,
Pensioenfonds voor Huisartsen) both have a score of 3.2, putting them on par with corporate pension funds.
This difference is confirmed when comparing the average scores for industry-wide/occupational pension funds
and corporate pension funds. The first group scores 2.6 points, while the second group lags behind at 1.4
points. The story is the same for pension funds surveyed last year (2.4) and those new to the survey (1.1).
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Results: Accountability
Pension funds play an important role in society as they supply large amounts of capital. At the same time,
consumers have little choice in choosing a pension fund; the fund is generally determined by employment.
Table 5: Total score for implementation and various instruments
Pension fund
Negative
selection
Positive Engagement
selection
Voting
policy
Sustainable
project
financing
Total
5
5
5
4
4
4.6
2 ABP
4
4
5
5
4
4.4
4
3
5
5
2
3.8
5
4
5
4
1
3.8
4
2
5
5
3
3.8
5
3
3
4
2
3.4
4
3
4
4
2
3.4
8 Pensioenfonds KPN
4
3
5
3
1
3.2
4
2
5
4
1
3.2
4
3
5
3
1
3.2
4
3
2
3
4
3.2
4
1
5
4
2
3.2
4
3
4
4
1
3.2
4
2
4
4
2
3.2
4
3
3
3
2
3.2
4
4
3
2
2
3.0
3
3
4
4
1
3.0
4
2
4
3
2
3.0
3
2
4
3
3
3.0
2
3
2
2
4
2.6
4
2
3
2
2
2.6
3
2
3
3
2
2.6
3
2
3
3
2
2.6
5
2
1
3
1
2.4
3
3
3
2
1
2.4
3
2
3
3
1
2.4
3
2
1
3
2
2.2
3
2
3
3
0
2.2
4
1
2
3
1
2.2
1
1
3
3
1
1.8
3
1
1
3
1
1.8
2
1
1
2
1
1.4
1
2
1
2
1
1.4
3
0
0
3
0
1.2
1
1
1
2
1
1.2
1
2
1
1
1
1.2
0
0
3
2
0
1.0
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Table 5: Total score for implementation and various instruments
Pension fund
Negative
selection
Positive Engagement
selection
Voting
policy
Sustainable
project
financing
Total
0
1
3
1
0
1.0
0
0
0
2
2
0.8
0
0
0
2
2
0.8
0
2
0
1
0
0.6
2
0
0
0
1
0.6
0
1
3
1
0
1.0
0
0
1
1
0
0.4
0
0
0
1
0
0.2
0
0
0
1
0
0.2
0
0
0
0
0
0.0
0
0
0
0
0
0.0
0
0
0
0
0
0.0
0
0
0
0
0
0.0
0
0
0
0
0
0.0
0
0
0
0
0
0.0
For this reason it is very important that pension funds are held accountable to society for the responsible
investment policy they determine and implement. The three criteria in the accountability category of this
survey are designed to see whether or not pension funds provide adequate transparency.
3.4.1
Many pension funds outsource (a part of) their asset management and responsible investment activities. This
raises questions related to the measure of control maintained with regards to the implementation of the responsible investment policy. Are the external asset managers or other parties to whom activities are outsourced capable of investing responsibly and are they acting in accordance with the pension fund’s choices and
priorities for responsible investment?
Pension funds should provide insight into asset management outsourcing and responsible investment activities. Insight must also be provided into how external parties are committed to the pension funds’ responsible
investment policy. The score is higher if the pension fund uses external company knowledge of ESG criteria in
its selection policy.
Large pension funds are able to make use of their own specialised fiduciary manager, but outsource various
elements to eternal asset managers and service providers. Smaller pension funds can also outsource their fiduciary asset management to external parties such as Syntrus Achmea, Mn Services, Cordares, or TKP
Investments. These managers, in turn, outsource asset management and other services as well.
A total of 16 pension funds provide insight into their outsourcing, providing a list of external parties, and formalize external party commitment its responsible investment policy. One pension fund (Pensioenfonds PNO
Media) selects external parties based on sustainability criteria and therefore receives 5 points. This means
that the majority of pension funds only provide partial or no insight into their asset managers and how they
are bound to their responsible investment policy.
3.4.2
A responsible investment policy is based on acknowledging the social responsibility that pension funds bear in
their role of institutional investors. This implies interaction with participants and pensioners as well as socie-
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ty in general. The fund needs to gain insight into what it is that society requires from it, how best to cooperate and how best it can assume its responsibilities. Seeking constructive dialogue with pension fund participants and beneficiaries, academics, politics, civil society institutions, media and others on the various corporate responsibility issues is therefore of essential value.
Eighteen pension funds indicated that they sought a dialogue with their participants concerning responsible
investment issues. A number of these pension funds also participated in dialogue with civil society institutions, sector working groups and/or other stakeholders. Two pension funds (Pensioenfonds PNO Media,
Pensioenfonds Zorg en Welzijn) were able to show that these activities had a demonstrable impact on their
responsible investment policies.
3.4.3
Consumers and civil society have a right to know about companies’ and organizations’ involvement in society so that it can be taken into account when making decisions. In a similar way, pension funds bear a responsibility to offer insight into the basis and criteria for their responsible investment policy as well as the
applied instruments and results. There should be an overview of the investments made by the pension fund
using the premiums of their participants. This overview should be available to these participants.
Sixteen pension funds provide a list of (equity) investments and also report to some extent on the applied
instruments and results. Of these 16 pension funds, only 2 corporate pension funds provide a list of (equity)
investments. A number of pension funds go a step further by reporting on all instruments, while three pension funds (Pensioenfonds PNO Media, Pensioenfonds Zorg en Welzijn, ABP) also provide information on their
investments in multiple asset classes. This is an improved of level of transparency in comparison to previous
editions of this benchmark.
3.4.4
Total score accountability
All in all, the top five pension funds in terms of transparency are all industry-wide pension funds, and for the
first time the top pension fund receives a perfect score for one of this category: Pensioenfonds PNO Media
(5.0), Pensioenfonds Zorg en Welzijn (4.5), ABP (4.1), Pensioenfonds Openbaar Vervoer (3.8), and Spoorwegpensioenfonds (3.8). The scores are shown in Table 6 below.
The average score for all pension funds for this category was 2.0, with industry-wide and occupational pension funds scoring significantly higher (2.5) than corporate pension funds (1.4).
Table 6: Accountability
Pension fund
38
Transparency in
outsourcing
5
Dialogue with
society
Reporting
5
5
Total
5.0
3
5
5
4.5
3 ABP
3
4
5
4.1
3
4
4
3.8
3
4
4
3.8
3
3
4
3.4
3
2
4
3.0
3
3
3
3.0
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Table 6: Accountability
Pension fund
Transparency in
outsourcing
Dialogue with
society
Reporting
Total
3
3
3
3.0
3
4
2
3.0
2
4
2
2.8
2
3
3
2.8
3
3
2
2.6
3
3
2
2.6
3
2
3
2.6
2
2
3
2.4
2
3
2
2.4
18 Bedrijfstakpens.fds Schoonmaak- en Glazenwassersbedrijf
2
2
3
2.4
2
3
2
2.4
2
2
3
2.4
2
2
3
2.4
2
3
2
2.4
2
3
2
2.4
3
2
2
2.3
3
2
2
2.3
3
2
2
2.3
1
3
2
2.1
2
2
2
2.0
2
2
2
2.0
2
2
2
2.0
2
2
2
2.0
2
1
3
2.0
1
2
2
1.8
1
2
2
1.8
2
2
1
1.6
0
2
2
1.5
1
2
1
1.4
2
0
2
1.3
1
0
2
1.0
0
0
2
0.8
0
2
0
0.8
0
2
0
0.8
2
0
0
0.5
2
0
0
0.5
0
0
1
0.4
1
0
0
0.3
1
0
0
0.3
1
0
0
0.3
1
0
0
0.3
1
0
0
0.3
0
0
0
0.0
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3.5 Final score
The overall score for the 51 surveyed pension funds is a weighted average of the nine criteria in 3 categories.
The weightings for the three categories to arrive as a overall score are shown as follows:
-
The responsible investment policy: 20%
-
The implementation of the responsible investment policy: 60%
-
The accountability for the responsible investment policy: 20%
The overall score for all 51 pension funds is shown in Table 7. The scores are on a scale of 1 to 5, with 5 being
the highest possible score. The top five pension funds when looking at the results are Pensioenfonds Zorg en
Welzijn (4.7), ABP (4.5), Pensioenfonds PNO Media (4.3), Pensioenfonds voor de Metalelektro (4.0), and
Pensioenfonds Metaal en Techniek (3.9).
The top two positions are unchanged from the previous editions, while the individual scores have improved.
New in the top 3 is PNO Media, a smaller pension fund that moves up one position from last year. The
Pensioenfonds voor de Metalelektro drops one position down to 4th place, with a score reduced by 0.3. New
in fifth place is Pensioenfonds Metaal en Techniek with a overall score of 3.9, an improvement of 1.4 points
in comparison to the 2008 edition of this survey. The pension fund that was included for the first time in this
survey with the highest score is Pensioenfonds Openbaar Vervoer, with a score of 3.6.
When looking at the average overall scores for industry-wide/occupational pension funds and corporate pension funds, there is a significant difference. This difference is also similar for previously surveyed and newly
reviewed funds. The size of the pension fund is also an important factor, with larger pension funds scoring
higher than small and medium sized ones.
Table 7: Overall score responsible investment policy of pension funds
Pension fund
New
Policy
Implementation Accountability
Overall score
No
5.0
4.6
4.5
4.7
2 ABP
No
5.0
4.4
4.1
4.5
No
5.0
3.8
5.0
4.3
No
5.0
3.8
3.4
4.0
No
5.0
3.8
3.0
3.9
Yes
4.0
3.4
3.8
3.6
No
5.0
3.4
2.3
3.5
No
4.0
3.2
3.8
3.5
9 Pensioenfonds KPN
No
4.0
3.2
2.3
3.2
No
4.0
3.2
2.3
3.2
No
4.0
3.2
2.1
3.1
Yes
4.0
3.0
2.6
3.1
No
3.0
3.2
3.0
3.1
No
4.0
3.0
2.4
3.1
Yes
3.0
3.2
2.6
3.0
No
3.0
3.0
3.0
3.0
No
3.0
3.0
2.4
2.9
No
4.0
2.4
3.0
2.8
No
2.0
3.2
2.4
2.8
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Table 7: Overall score responsible investment policy of pension funds
Pension fund
New
Policy
Implementation Accountability Overall score
No
2.0
3.2
2.0
2.7
No
3.0
2.6
2.8
2.7
No
3.0
2.6
2.8
2.7
No
3.0
2.6
2.6
2.7
No
3.0
2.4
2.0
2.4
No
2.0
2.6
2.4
2.4
Yes
3.0
2.2
2.4
2.4
No
4.0
2.2
1.3
2.4
No
3.0
2.2
2.0
2.3
No
2.0
2.4
1.8
2.2
No
3.0
1.8
2.4
2.2
No
2.0
1.4
2.4
1.7
Yes
1.0
1.8
2.0
1.7
No
2.0
1.2
2.0
1.5
Yes
2.0
1.0
2.4
1.5
No
2.0
1.2
1.4
1.4
No
1.0
1.4
1.6
1.4
No
1.0
1.2
1.8
1.3
No
2.0
0.6
1.0
1.0
No
2.0
0.6
0.8
0.9
No
1.0
1.0
0.4
0.9
Yes
1.0
0.8
0.3
0.7
Yes
0.0
0.8
0.8
0.6
No
1.0
0.2
1.5
0.6
Yes
1.0
0.4
0.3
0.5
Yes
2.0
0.0
0.3
0.5
Yes
1.0
0.2
0.5
0.4
Yes
1.0
0.0
0.3
0.3
Yes
1.0
0.0
0.3
0.3
No
0.0
0.0
0.8
0.2
Yes
0.0
0.0
0.5
0.1
Yes
0.0
0.0
0.0
0.0
3.6 Progress
In this section, the scores of the pension funds included in previous editions are listed along with the difference in scores between 2007-2008 and 2008-2009. Table 8 shows that a significant number of pension funds
have taken major steps in developing, implementing, and reporting on their responsible investment policies.
The 15 pension funds included for the first time this year are not found in this table.
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Table 8: Overall scores in 2007, 2008 and 2009 and progress made in 2008 and 2009.
Pension fund
Overall
score
2007
Overall
score
2008
Overall
score
2009
Difference
2007-2008
Difference
2008-2009
3.8
4.5
4.7
0.7
0.2
3.5
4.3
4.0
0.8
-0.3
3 ABP
3.4
4.4
4.5
0.9
0.1
2.8
2.5
3.9
-0.3
1.4
2.1
2.3
3.0
0.2
0.7
1.9
2.2
2.2
0.3
0.0
1.7
1.8
3.1
0.1
1.3
1.7
2.0
1.7
0.3
-0.3
1.6
1.4
2.3
-0.2
1.0
1.5
2.6
2.4
1.1
-0.2
11 Bedrijfstakpensioenfonds Schoonmaak- en
1.5
2.7
2.9
1.2
0.2
1.5
2.6
3.2
1.1
0.6
1.5
1.8
2.8
0.3
1.1
1.4
1.6
2.4
0.2
0.8
1.4
3.3
3.5
1.9
0.2
1.4
1.5
1.3
0.1
-0.2
1.4
1.7
2.2
0.3
0.5
1.3
1.3
1.5
0.0
0.2
1.1
0.9
2.4
-0.2
1.4
0.7
2.4
2.7
1.6
0.3
0.7
0.4
0.6
-0.4
0.3
0.6
0.7
3.1
0.1
2.4
0.6
3.0
3.1
2.4
0.1
0.5
1.2
1.1
Glazenwassersbedrijf
1.7
2.8
4.1
4.3
0.2
3.3
3.5
0.2
2.9
2.7
-0.2
2.6
3.2
0.6
1.7
0.2
-1.5
1.4
2.7
1.3
1.4
1.4
0.0
1.3
2.7
1.4
1.1
1.4
0.3
1.1
0.9
-0.1
1.0
1.0
0.0
0.9
0.9
0.0
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Table 9 below highlights the pension funds that have improved their score by more than 1 point since the 2008
edition of this report. Leading the way is Pensioenfonds Werk en (re)Integratie that improved its score by 2.4
points. The ABN AMRO Pensioenfonds, Pensioenfonds Metaal en Techniek, and Pensioenfonds Medisch
Specialisten follow with an improvement of 1.4 points.
It is interesting to note that all three pension fund types are present in this table. This shows that not only
industry-wide, but also occupational and corporate pension funds are willing and able to make significant
improvements in determining, implementing, and reporting on their responsible investment policies.
Table 9: Pension funds with more than one point progress in 2009
Table 9: Pension funds with more than one point progress in 2009
Short name
Endscore
2008
Endscore
2009
Difference
2008-2009
0.7
3.1
2.4
0.9
2.4
1.4
2.5
3.9
1.4
1.3
2.7
1.4
1.8
3.1
1.3
1.4
2.7
1.3
1.7
2.8
1.1
1.8
2.8
1.1
1.4
2.3
1.0
3.7 Conclusions
In this third edition of the “Benchmark Responsible Investment by Dutch Pension Funds (and Pension Insurance
Companies)”, carried out by the VBDO in association with research consultancy Profundo, it is time to discuss
the progress that pension funds have made. The 2008 edition saw that, despite the outbreak of the economic crisis, pension providers kept working on the development and implementation of a responsible investment
policy. This edition confirms that the largest Dutch pension funds continue to make progress in the field of
responsible investment.
The 2009 edition of the benchmark on pension funds surveyed only pension funds, as a separate benchmark
study had been carried out for insurance companies. The number of surveyed pension funds was increased
from 36 to 51 (with one pension fund asking to be included). The overall participation rate (84%) increased
as well, the highest rate yet.
37 out of 51 pension funds surveyed have a finalized responsible investment policy and another 3 are developing one. This equals approximately 72% of the population, while last year a little less than half of the pension funds had developed a policy. While this shows definite progress, it also means that 11 of the researched
pension funds have not begun the process of defining a responsible investment policy. Most of these pension
funds without a policy were included in this benchmark for the first time.
Clear progress is being made not only in terms of policy development, but also in the way certain tools are
used to implement these policies:
•
33 (last year 20) pension funds have excluded investments in the controversial weapons industry and
individual weapons companies, while 14 of these funds (last year 7) have also excluded companies on
other grounds, such as child labour and environmental pollution.
•
15 (last year 10) pension funds clearly make use of ESG criteria in selecting investments;
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27 (last year 12) pension funds address the issue of corporate responsibility in their contacts with
companies in which they invest (engagement);
•
For 38 (last year 29) pension funds, sustainability plays a role during voting procedures at
shareholder’s meetings;
•
20 (last year 15) pension funds are investing a small amount of their capital in sustainable energy,
innovative clean technology and microfinance.
Despite these encouraging developments, many pension funds still need to translate a responsible investment
policy into a broad and well-balanced combination of instruments. In the first place, the majority of pension funds
limit their exclusion policy to one asset class (equity). Secondly, responsible investment policies cannot be fully
and credibly implemented using only one or two instruments. There also remains a lot of work to be done in terms
of accountability for responsible investment policies towards participants and other stakeholders:
•
Most pension funds are not clear on which asset managers they make use and whether or not they
are selected on the basis of sustainability criteria;
•
Only 16 pension funds provide details about their asset managers and have established how these
managers are bound to the fund’s policy on responsible investment;
•
17 pension funds actively engage society in dialogue concerning their policies;
•
16 pension funds actually publish overviews of their (equity) investments.
In order to assess and compare the various pension fund responsible investment policies, the VBDO defined of
nine assessment criteria divided over the following three categories:
1.
Policy;
2.
Implementation;
3.
Accountability.
All pension funds were scored between 1 and 5 for each of the nine criteria. These scores were weighted and
added up, resulting in scores per category as well as a final score. The overall score determines which pension funds have the best overall - policy, implementation and accountability - responsible investment policy.
Table 8 provides an overview of the top ten highest overall scores of pension funds, given both the assessment categories and the overall scores. The funds included in the table score at least one point higher than
the average score of 2.1.
Table 10: Ten highest overall scores in 2009
Pension fund
Policy
Weight
20%
60%
5.0
2 ABP
5.0
5.0
Overall score
20%
100%
4.6
4.5
4.7
4.4
4.1
4.5
3.8
5.0
4.3
5.0
3.8
3.4
4.0
5.0
3.8
3.0
3.9
4.0
3.4
3.8
3.6
5.0
3.4
2.3
3.5
4.0
3.2
3.8
3.5
9 Pensioenfonds KPN
4.0
3.2
2.3
3.2
4.0
3.2
2.3
3.2
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When comparing different pension fund types, Table 11 shows that industry-wide pension funds have a higher average score than the other types of pension funds. This goes for all assessment categories as well as for the overall scores. It is, however, important to note that industry-wide pension funds are on average larger than others.
Regardless of pension fund type, there exists a clear connection between the final results and the size of the
funds: larger pension funds have better average scores. This can be partially explained by the fact that they are
much more in the public view and therefore pay more attention to the subject and partially because they have
more resources available for the development and implementation of a responsible investment policy.
Table 11: Average score for each assessment category and overall score by type, size and population in 2009
Pension fund
Policy
Average score in general
2.6
2.1
2.0
2.1
Industry-wide and occupational (29)
3.1
2.6
2.5
2.7
Corporate (22)
1.9
1.4
1.4
1.5
Last year’s population (36)
3.0
2.4
2.3
2.5
New population (15)
1.8
1.3
1.3
1.4
Overall score
Type of pension funds
Newly reviewed pension funds
Size of pension funds (invested capital)
Up to 1 billion Euro (6)
2.2
1.5
1.6
1.6
1 to 10 billion Euro (35)
2.4
2.0
2.0
2.1
From 10 billion Euro (7)
4.4
3.6
3.3
3.7
Table 12 shows that the average overall score has stayed the same in 2009. While the average of the overall
score improved significantly in between 2007 and 2008, there was no difference between 2008 and 2009.
Table 12: Average overall score for all pension funds and by type, size and population in 2007, 2008 and 2009
2007
2008
2009
1.6
2.1
2.1
Industry-wide and occupational
1.8
2.6
2.7
Corporate
1.2
1.6
1.5
1.6
2.2
2.5
-
1.9
1.4
Average score for all pension funds
Type of pension funds
Newly reviewed pension funds
Last year’s population
New population
Size of pension funds (invested capital)
Up to 1 billion Euro
-
1.2
1.6
1 to 10 billion Euro
1.3
1.9
2.1
From 10 billion Euro
2.4
2.9
3.7
This can be attributed to the fact that pension funds included for the first time score low, but the funds included in previous editions have improved their scores, as shown in Figure 3. The research population of 2007
alone has even improved its average score to 2.8. This means that some pension funds have improved their
overall score with more than two points since 2007: Pensioenfonds Werk en (re)Integratie, Shell
Pensioenfonds, Pensioenfonds voor Huisartsen and Bedrijfstakpensioenfonds Vervoer.
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Average of overall score by population in 2007, 2008 and 2009
VBDO urges the pension funds included for the first time to take up the challenge and provide insight into their
activities in the area of responsible investing. Providing transparency is key to responsible investment. This involves more than just publishing a policy on the website.
As mentioned earlier in this report, this is the third year in a row that the VBDO has published a benchmark concerning responsible investment by pension funds. Small changes in methodology were made to better reflect
nuances in the differences between pension funds or were made in response to feedback received, such as in the
advisory council meetings. Throughout these three years, however, the methodology has remained practically the
same. This was a conscious decision, allowing the VBDO to track the developments made.
The VBDO does realize, however, that no methodology is perfect. Differences in responsible investment practices
between pension funds still remain underexposed despite the changes made. This is compounded by the fact that
both the pension funds in the Netherlands as well as responsible investment practices in general have witnessed
dramatic changes over the last three years. The time has come to make significant changes to the methodology.
In the first place, the instruments used to implement responsible investment have developed and evolved. This
needs to be reflected in the new methodology. When scoring engagement, for example, the criteria should include not only engagement with companies that are directly invested in but also engagement with the asset managers of the pooled funds in which many pension funds participate.
Secondly, responsible investment has been focussed primarily on the equity asset class. This is shown by the fact
that the majority of policies are applicable only to this class. The VBDO is, however, convinced that responsible
investment applies not only to equity but also to all other asset classes. These classes are, among others, fixed
interest (both corporate and country bonds), real estate, and alternative investments such as private equity and
hedge funds. To name one example, while real estate investments made by pension funds form a significant part
of pension funds’ investment portfolio, the current methodology does not pay explicit attention to it. The last
few years have seen a dramatic increase in attention for sustainability issues within this sector yet few institutional investors have developed systematic sustainability criteria for this asset class. Future benchmarks for pension funds as well as for insurance companies will pay more explicit attention to multiple asset classes.
The current and future sustainability changes facing the world and its financial markets are real and need to be
addressed now. The VBDO is confident that, by making these changes, it can continue to play a leading role in
making the Dutch financial markets more sustainable.
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4./ Pension fund profiles
4.1 ABP
ABP is an industry-wide pension fund. The fund is responsible for implementing the collective pension scheme of the Dutch government, and intended for employees in governmental organisations and education.
Since March 2008 ABP has outsourced all of its activities to Algemene Pensioen Groep (APG) as a result of legal
changes in the Dutch pension fund system.
Description
Numbers (in millions of )
Premium income
-
Number of participants
Active
1 133 000
Non-active
872 000
Pensioners
750 000
Number of employees
-
Value of investments
 180 billion (as per 30 June 2009)
Distribution among investment categories:
Equity
29 %
Corporate bonds
17.5 %
Government bonds
10 %
Loans
-
Real estate
9%
Other:
Index linked bond
9%
Convertible bonds
3%
Private Equity
5%
Absolute return strategy
6%
Commodities
3%
Infrastructure
3%
Structured credits and loans 3.5 %
Innovation
2%
ABP publishes a responsible investment policy on its website. It is based on multiple (inter)national principles and directives, stating that ABP expects companies to comply to:
●
Code Tabaksblat;
●
OECD Principles of Corporate Governance;
●
International Corporate Governance Network Statement on Global Corporate Governance Principles;
●
OECD Guidelines for Multinational Enterprises; and
●
UN Global Compact.
In addition to the responsible investment policy, ABP also formulated a Code Corporate Governance.
The policy describes the goals regarding corporate governance and social responsibility and clarifies the use
of instruments. The policy applies to all investment categories.
Score: 5 points
Publicly available policy document considers deliberately chosen social and environmental issues, is
based on clear principles and directives, clarifies the use of instruments and covers all investment
categories.
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ABP has an exclusion policy that is described in both the policy and the Responsible Investment Report. ABP
does not want to invest in companies involved in the manufacturing or sale of services and products that are
prohibited by Dutch or international law. This means that ABP excludes companies that are involved in the
manufacturing and sale of landmines, cluster bombs, chemical and biological weapons. It also means that ABP
does not invest in companies that have an interest of more than 50% in a subsidiary directly involved in the
production of such weapons.
ABP reviews its exclusion policy on an annual basis and reports about the outcome in its Responsible
Investment Report. ABP’s publicly reports the list of 18 excluded companies in this report including the reason for exclusion.
Score: 4 points
Publicly available and clearly defined exclusion policy concerning one issue and publication of a list
of excluded companies.
4.1.3 ESG-criteria for the selection of investments (positive selection)
ABP is convinced that through its Responsible Investment Policy it can contribute to an improved risk adjusted
returns. The sustainability specialists together with the portfolio managers identify the relevant environmental,
social and governance criteria, discuss the impact on investments and define further research needs. Through this
process ABP aims to deepen and broaden insight into ESG issues and integrate these into the investment process.
ABP has not adopted a best in class approach, but does monitor the ESG ratings of its investments and conduct research and/or enters into engagement when important holdings have low ratings. For this research ABP
has access to large amounts of information sources, including: rating agencies, research institutes and academia, company reports and meetings, Bloomberg, CDP, and consultants.
Further integration of ESG issues in other asset classes is a continuous point of attention. In December 2008
the board adopted a proposal which that further integrate assessment of ESG criteria in all large investments
(for all asset classes) which need approval of the Central Investment Committee. ABP also approved to expand
the team of Sustainability Specialists from 3 to 6 persons (with dedicated specialists for Real Estate, the Hong
Kong office and integration in listed equities). Together with the Corporate Governance specialists the
Sustainability and Governance team consists of 8 persons.
Score: 4 points
Publicly available document containing clearly defined ESG criteria applied to several investment
categories, an overview of concrete activities carried out in order to weight ESG criteria such as, for
example, the purchase of sustainability analysis.
4.1.4 Engagement
Engaging with companies is a central aspect of ABP’s Responsible Investment Policy. ABP expects companies
to operate in line with the UN Global Compact. Therefore, ABP asks an external research provider to screen
companies on compliance with the UN Global Compact and enters into engagement with companies that do
not comply. If engagement does not lead to a satisfactory result and all tools are used, ABP can choose to
divest from the company. However, in 2008 ABP was pleased with the progression of ongoing engagement projects, also shown in its Annual Responsible Investment Report.
Score: 5 points
The pension fund has formulated an engagement policy clearly outlining deliberately chosen social
and environmental issues and regularly engages companies in dialogue. The pension provider also
reports on engagement activities and links this reporting to its exclusion policy.
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4.1.5 Voting policy
ABP’s voting policy is described in its Code Corporate Governance and in its Responsible Investment Report
2008. ABP has outsourced voting to its “uitvoeringsorganisatie” APG, which has developed and implemented
a voting policy in the past year, and in September made publicly available on the website. This voting policy
also covers a resolution concerning environmental and social issues.
ABP reports its voting behaviour by providing a complete list of votes via a proxy voting reporting tool. In 2008,
together with the Swedish government pension funds and New York City pension fund, ABP filed a shareholder
resolution for the general shareholder meeting in June 2009 of Freeport-McMoRan. The resolution called for
Freeport to appoint a board member with great expertise in environmental business, acknowledged by environmental organizations and industry as an authority. This case was also described in ABP’s Responsible Investment
Report. The resolution was supported by 32.5% of the shareholders, while a further 2% abstained. ABP is currently
in talks with this company to see how it plans to respond and is putting forward ideas on what type of person
should be selected. It is also talking to contacts in the US concerning this matter.
Score: 5 points
The pension fund actively votes on resolutions and supports other resolutions in favour of promoting
Corporate Responsibility and criticism of non-sustainability conduct and is publicizing (in annual
report or website) presence and voting behaviour during shareholder’s meetings.
In its Responsible Investment policy, ABP declared its intention to invest in projects for sustainability. It has no priority themes or issue but reports on the activities in the investment report, providing examples of investments.
The table below contains an overview of ABP’s investments in companies or services with high sustainability
relevance.
Asset class
Value
(million)
Examples
Private Equity
 350
AlpInvest cleantech mandate and 3 investments in micro finance
institutions.
Commodities
 650
2 investment in CO2 reduction projects and trading carbon credits (e.g.
Climate Change Capital), 2 investments in sustainable forestry (e.g.
Global Solidarity Forest Fund), investment in Jatropha biodiesel production and an Arabic gum with fair trade standards.
Infrastructure
>  150
Ampere Equity Fund mandate, Dutch Infrastructure Fund II and investments in various renewable energy infrastructure projects in infrastructure funds of ABN, NIBC, Macquarie and Energy Investors Fund.
Fixed Income
±  150
Credit default swap on a portfolio of bank loans that includes renewable energy infrastructure, loans to microfinance institutions and
corporate bonds to companies with >50% of revenues from products
services with high sustainability relevance.
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Listed Equities
 250
(see examples
below table)
(> 1.000)*
Other
 100
Energy Efficiency in China and FE Clean Energy
Total
 1.650
Of investments in companies with products services with high sustai-
(or 2.650)*
nability relevance. (* Depending on the definition for listed equities)
In companies with more than 50% of revenues from products services
with high sustainability relevance. (* In companies with 20%- 50% of
revenues from products services with high sustainability relevance.)
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Note. Examples for listed equity -as having 50% or more of revenues from renewable energy, energy efficiency or climate change solutions- include the following 29 companies: Iberdrola Renovables, EDP Renovaveis,
First Solar, Hansen Transmissions International, SolarWorld, BKW FMB Energie, Nordex, SunPower Corp,
Suntech Power Holdings Co., SMA Solar Technology AG, PV Crystalox Solar, Q-Cells, LDK Solar, Yingli Green
Energy Holding Co. Ltd., Energy Conversion Devices, GT Solar International, Gurit Holding, Clipper Windpower,
Phoenix Solar, Solar-Fabrik, Ceres Power Holdings, Vestas Wind Systems, Gamesa Corporacion Tecnologica,
Verbund, Vmware, Renewable Energy Corp., Ingersoll-Rand, Tandberg, Linear Technology and Alstom.
Examples for listed equity -as having 20-50% of revenues from renewable energy, energy efficiency or climate change solutions- include: Abengoa, ABB, Philips, Siemens, Schneider and Fortum.
ABP has the objective to increase the amount investments in activities with high sustainability relevance. ABP
monitors the amount invested in this category on a quarterly basis. APG is currently refining the methodologies for monitoring the investments in listed equity and other asset classes.
Score: 4 points
The pension fund has a clearly defined sustainable project investment policy and invests in excess of
 1.0 billion of its capital in sustainable funds/companies and provides information on projects and
investment size.
4.1.7 Transparancy on outsourcing
Since March 2008 ABP outsourced all of its activities to an independent organisation for execution of the policy (uitvoeringsorganisatie) APG, as a result of legal changes in the Dutch pension fund system. The
Responsible Investment policies of APG are in line with those of ABP and publicly available online. It also
publishes an annual Responsible investment Report online.
APG manages most of the asset in-house but also has various external mandates. New external managers or
new mandates to external managers need to be approved by the Central Investment Committee of APG.
Through this process the implementation of ABP’s Responsible Investment Policy in external mandates is secured. External managers are also bound by ABP’s exclusion policy. A list of the most important external mangers is publicly available on ABP’s website.
The private equity portfolio of ABP is delegated to AlpInvest. Alpinvest publishes the progress with the implementation of its responsible investment strategy publically in its annual review.
Score: 3 points
The pension fund is clear about its outsourcing, provides a comprehensive overview of external
parties AND formalizes external party commitment to its responsible investment policy.
The investment strategy of ABP is discussed with the “deelnemersraad” (participants council). This council advises the board on its policies including the Responsible Investment Policy. ABP regularly communicates with its
participant about responsible investment strategy for example in the ABP Magazine en de monthly digital
newsletter. ABP regularly receives questions of participants which are answered by the sustainability specialists of APG.
ABP and/or APG are in regular contact with NGOs en unions, for example: Both Ends, Oxfam (active participation in Better Returns in a Better World), Somo, WWF, WRI and The Pacific Institute.
Score: 4 points
The pension fund seeks dialogue concerning corporate responsibility issues with participants, policy
holders and other representatives of society. It is unclear how this affects the responsible investment
policy.
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The implementation of ABP’s Responsible Investment Policy is described in ABP’s annual Responsible
Investment Reports 2007 and 2008 which are available on ABP’s website. ABP’s website also contains some
videos with examples of investments in microkredits, forrestry and renewable energy and clean technology.
Annually on its website ABP provides insight into all investments in listed equities and corporate bonds.
Score: 5 points
The pension fund publishes a detailed overview of companies within multiple investment categories
in which investments are made. In addition, they report in detail on the applied instruments and
results.
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4.2 BPF Bakkers
The Stichting Bedrijfspensioenfonds voor het Bakkersbedrijf is responsible for all current and ex-employees in
the bakery and patisserie branche.
Description
Premium income
 69,3
Active
40 569
Non-contributing
177 077
Pensioners
17 595
Number of employees
 1 855,8
Equity
508,0
27.4 %
Bonds
1 291,4
69.6 %
Derivatives
3.1
0.01 %
Real estate
49.3
2.7 %
Alternatives
4.0
0.02 %
Cash
-
0%
On responsible investment BPF Bakkers states that they will conform to the guidelines that the VB will publish.
It is unclear whether the fund has its own socially responsible investment policy.
Score: 1 point
BPF Bakkers does not have a publicly available responsible investment policy. However,
in their general investment policy there is reference to responsible investment.
4.2.2 Exclusions
No information.
Score: 0 points
4.2.3 ESG-criteria for portfolio selection
No information.
Score: 0 points
4.2.4 Engagement
No information.
Score: 0 points
4.2.5 Voting policy
No information.
Score: 0 points
No information.
Score: 0 points
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BPF Bakkers has outsourced all investment activities to Robeco. Robeco can hire external asset managers on
behalf of BPF Bakkers.
Score: 1 point
BPF Bakkers is clear about outsourcing and provides information on the asset manager.
No information.
Score: 0 points
No information.
Score: 0 points
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4.3 BPF Landbouw
The sector pension fund for agriculture (Bedrijfspensioenfonds voor de Landbouw) takes care of the pensions
for employees in the agricultural and green sector. Everyone who works for an organization or company in
these sectors and is above the age of 21 participates in the pension fund.
Description
Premium income
 210 158
Active
Non-contributing
Pensioners
Number of employees
0
 7 164 573
91 114
536 175
53 347
Equities
16 %
Fixed income
49 %
Real Estate
Direct
32 %
Indirect
0%
Alternatives
2%
Liquidity
1%
BPF Landbouw has formulated a responsible investment policy. The policy consists of:
●
Screening of companies based on the UN Global Compact
●
Exclusion
●
Engagement
●
Corporate governance and voting at shareholders meetings
The pension fund uses the principles of the UN Global Compact as framework. The exclusion approach has
been applied to the pension fund’s actively managed equity portfolios since 2008, the introduction of governance activities dates back to 2005.
At this moment the pension fund is exploring the possibility of excluding companies that violate the principles of the Global Compact. To do this, a screening based on controversies with the UN Global Compact principles was carried out for the equity portfolio. Adoption of the revised responsible investment policy as a
result of obtained insights is expected before the end of 2009. As soon as the responsible investment policy
has been adopted it will be published on the pension fund’s website. The pension fund will take the introduction of a responsible investment policy for the fixed income portfolios and other asset classes into consideration in the near future.
Score: 2 points
BPF Landbouw has a (socially) responsible investment policy that provides insight into the international
standards upon which it is based and the instruments that are used. At this point it covers one asset
class. It is, however, not publicly available at this time.
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4.3.2 Exclusions
BPF Landbouw has an exclusion policy with respect to controversial weapons. The pension fund considers weapons controversial when they cause a disproportionate number of casualties, when they do not make a distinction between military and civilian targets, and when these weapons cause harm after the conflict has been
terminated. Controversial weapons, such as cluster munitions, have a negative long term impact on both the
economic and social development of a post conflict area. The exclusion of these types of weapons fits within
the framework of the pension funds’ social responsible investment policy.
The pension fund considers the following type of weapons as controversial:
-
Nuclear weapons;
-
Biological weapons;
-
Chemical weapons;
-
Anti-personnel mines and;
-
Cluster munitions.
A formal policy document with more background information can be found on the website.
BPF Landbouw currently only excludes producers of controversial weapons. The pension fund is considering
excluding companies that violate the principles of the Global Compact.
Score: 3 points
BPF Landbouw currently has a publicly available exclusion policy around one issue: controversial
weapons.
BPF Landbouw will include Environmental, Social and Governance information into its mainstream investment
processes in order to improve the risk return profile of the portfolio. This is a result of BPF Bouw’s belief that
ESG information is often not explicitly valued in financial data, while it can have financial consequences. To
this end, BPF Landbouw makes use of research from external (ESG) data providers, academic research as well
as in-house research.
Score: 2 points
BPF Landbouw states that it incorporates ESG-criteria into its investment strategy.
4.3.4 Engagement
BPF Landbouw enters into a dialogue with companies to stimulate companies to adopt sustainable behaviour and
good corporate governance and to increase shareholder value. The principles of the United Nations Global
Compact are used as a framework when entering into dialogue with companies as these offer companies a framework for corporate responsibility. These engagement activities have been carried out since the middle of 2009.
The engagement process starts with an in depth theme research report. Engagement targets are then set per
company based on the research. If targets are not met within 3 years, the pension fund may decide to exclude the company from its investment portfolio. The pension fund will report on its website concerning its responsible investment activities including engagement activities on a semiannual basis.
Score: 3 points
BPF Landbouw has an engagement policy and is clear about the criteria upon which it is based. There
is currently no report available about its activities.
4.3.5 Voting policy
BPF Landbouw has adopted a voting policy to govern the exercise of voting rights for all of its direct equity
investments.
Proposals at the general meetings are evaluated using the fundamental principles of good corporate gover-
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nance, while taking into account best practice standards pertinent both to the relevant market and international markets. These principles include board composition, executive remuneration and shareholder rights.
BPF Landbouw also pays special attention to shareholders resolutions that are related to environmental and
social issues, and to shareholder meetings of companies that are included in the engagement program.
The pension fund makes use of a specialist research provider, the RiskMetrics Group that provides information
concerning upcoming shareholder meetings of companies in its equity portfolios. Due to the international character of the pension fund’s equity portfolio, it is not possible to attend all general meetings. The pension
fund exercises its voting rights by proxy voting, that are facilitated by the RiskMetrics Group as well.
The pension fund is fully committed to communicating its voting activities and disclosing its voting behaviour
and provides information per shareholder meeting on its website. Voting reports are available to the pension
fund’s beneficiaries and the general public on both a quarterly and annual basis.
Score: 3 points
BPF Landbouw has an active voting policy and is clear about the sustainability criteria upon which it
is based (corporate governance). Its voting activities are also publicly available.
BPF Landbouw has allocated a part of its assets to private equity. The pension fund participates in the
Interpolis Pensioenen Sustainable Private Equity Fund. Responsible investment is an important strategy within
this fund. This is expressed in its strict criteria:
-
Exclusion of sectors (production of pornographic material, tobacco, fur, and the production and/or
distribution of weaponry.
-
The importance of the 10 UN Global Compact principles when negotiating with fund managers.
-
Exclusion of strategies based on hostile take-overs.
Score: 2 points
BPF Landbouw has a sustainable project-financing portfolio, but it is unclear what the value of these
investments is.
BPF Landbouw has outsourced its asset management to Syntrus Achmea Asset Management. Syntrus Achmea
Asset Management is committed to implementing the responsible investment approach and reports to the pension fund on a semi-annual basis.
Score: 2 points
BPF Landbouw provides clarity into its asset managers and provides insight into how the asset
manager complies with and carries out its responsible investment policy.
BPF Landbouw has formulated and implemented a communication policy. An abstract of this policy is available on the website. Responsible investment is not explicitly addressed in the policy. The pension fund is not
involved in an active dialogue with society at the moment.
Score: 2 points
BPF Landbouw engages in dialogue with its participants.
BPF Landbouw publishes its voting policy and its exclusion policy on its website. The responsible investment
policy is expected to be published on the website. The pension funds reports on its activities related to responsible investment on a semi-annual basis.
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With regards to its voting activities, BPF Landbouw reports on a quarterly and annual basis on corporate governance and voting activities. An online tool is used to report on the pension funds’ voting activities for each
shareholder meeting.
Score: 2 points
BPF Landbouw reports on a number of its applied instruments and provides insight into its equity
holdings through its voting reporting tool.
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4.4 BPF Bouw
The Stichting Bedrijfstakpensioenfonds voor de Bouwnijverheid (BPF Bouw) is responsible for the pensions of
more than 15,000 companies in the construction, woodworking, finishing and natural stone sectors.
Description
Premium income
 1 156
845 989
Number of employees
-
 24 185
Equity
6,422
27.5 %
Bonds
9,821
42.1 %
Government bonds
3,426
14.7 %
Real estate
5,530
23.7 %
Other
1,223
6.7 %
BPF Bouw has developed a responsible investment policy that covers all equity investments with the exception of passive equity investments. This document is publicly available on its website and summarized in its
annual report for 2008. The UN Principles for Responsible Investment (PRI) form the basis for BPF Bouw’s responsible investment activities. Sustainability is an important factor in its real estate portfolio as well.
Score: 3 points
BPF Bouw does have a (socially) responsible investment policy that is publicly available. This policy
does not, however, provide clarity about the international standards (besides the UNPRI) upon which
it is based and does not cover all asset classes.
4.4.2 Exclusions
BPF Bouw has a publicly available exclusion policy. Companies and countries are excluded when they are engaged in activities that go against international principles and guidelines, lead to illegal or immoral behaviour,
or are related to human rights and freedoms violations. This means that BPF Bouw does not invest in companies that produce cluster bombs or landmines or make use of child labour. Countries are also excluded when
they systematically violate human rights. Investments in these countries are only allowed when companies
active in these countries are avoiding these violations. An exclusion list is available upon request.
Score: 4 points
BPF Bouw has a publicly available exclusion policy concerning various social issues, but does not have
a publicly available list of excluded companies and/or countries.
BPF Bouw makes use of a best-in-class approach for part of its equity portfolio. Research company
Sustainalytics is used to define the investment universe for the separate responsible investment portfolio. In
general, BPF Bouw includes ESG-criteria in a number of asset classes (equity, real estate, microfinance) and
looks to expand this into thematic investments such as infrastructure, forestry and energy production.
Score: 4 points
BPF Bouw makes use of a best-in-class approach for part of its equity portfolio. There is also a
general description of ESG-criteria that are considered for other areas of the portfolio.
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4.4.4 Engagement
BPF Bouw has an engagement policy based upon Corporate Governance issues. If there is a Corporate
Governance issue with a company, BPF Bouw will engage with the company as shareholder to resolve the issue.
Score: 3 points
BPF Bouw does have an engagement policy, and is clear about the priorities upon which it is based
(Corporate Governance). There is, however, no reporting about these activities.
4.4.5 Voting policy
BPF Bouw has delegated its voting activities to Cordares Vermogensbeheer. A document describing the voting
policy is available upon request. Cordares Vermogensbeheer makes use of RiskMetrics to implement its voting
policy and reports on its voting activities.
Score: 2 points
BPF Bouw has an active voting policy that explicitly includes environmental and social issues that is
not publicly available. Its voting activities are not publicly available.
BPF Bouw seeks to have a number of thematic investments that deliver financial as well as social return. BPF
Bouw has a venture capital investment in Triodos Bank (900,000), and via private equity in the Ampere Equity
Fund (1.7 million). It also has a microfinance investment with a value of 49 million.
Score: 2 points
BPF Bouw has a sustainable project financing portfolio that makes up less than 1% of its invested capital.
BPF Bouw has outsourced its entire asset management to Cordares Vermogensbeheer, including its responsible investment activities.
Score: 3 points
BPF Bouw provides a full list of its asset managers and provides insight into how the asset manager
complies with and carries out its responsible investment policy.
BPF Bouw’s investment strategy is discussed within its participant council (deelnemersraad). This council advises the board on its policies including its responsible investment policy. This strategy is regularly communicated to BPF Bouw’s members in, for example, its Bouwpensioen Magazine.
Score: 3 points
BPF Bouw has seeks a dialogue with its participants about its responsible investment policy.
BPF Bouw reports on its responsible investment policy and implementation on its website and annual report.
It also publishes a list of its equity holdings on its website.
Score: 3 points
BPF Bouw partially reports on its responsible investment policy and publishes a list of its equity
holdings.
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4.5 Bedrijfstakpensioenfonds voor de Detailhandel
Bedrijfstakpensioenfonds voor de Detailhandel (BPF Detailhandel) is an industry wide pension fund. The fund
is responsible for implementing the collective pension scheme of employees in the retail business.
Description
Numbers (per 31 December 2008)
Premium income
 363 million
Active
239 714
Non-contributing
636 686
Pensioners
58 285
Number of employees
-
 6.9 billion
Equities
27 %
Fixed income
58 %
Real estate (direct)
9%
Real estate (indirect)
2%
Alternatives
2%
Liquidity
2%
BPF Detailhandel has formulated and implemented:
●
a corporate governance & voting policy based on ICGN Guidelines; and
●
an exclusion policy on controversial weapons.
Both policies are being applied to the actively managed equity portfolios and available at the pension fund’s
website.
Score: 3 points
Publicly available policy document that considers corporate governance issues and controversial
weapons and clarifies the use of instruments, but covers only one investment category.
Bedrijfstakpensioenfonds voor de Detailhandel has formulated an exclusion policy with respect to controversial weapons in the first half of 2009.
The pension fund considers certain types of weapons controversial in case these weapons causes disproportionate number of (deadly) victims, in case these weapons do not make a distinction between military and civil
objects and in case these weapons causes harm after the conflict has been terminated. Besides, controversial weapons, such as cluster munitions, have a negative long term impact on both economic and social development of a post conflict area.
-
Nuclear weapons;
-
Biological weapons;
-
Chemical weapons;
-
-
Cluster munitions.
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Other than producers of controversial weapons the pension fund does not exclude companies.
Score: 3 points
Publicly available and clearly defined exclusion policy concerning one issue.
BPF Detailhandel will include Environmental, Social and Governance information into its mainstream investment processes in order to improve the risk return profile of the portfolio. This stems from the idea that ESG
information is often not explicitly valued in financial data, while it can have financial consequences.
To this end the pension fund uses research from external (ESG) data providers, academic research as well as
in-house research.
Score: 2 points
The pension fund only gives a general statement saying that ESG criteria are included in selecting
investments.
4.5.4 Engagement
BPF Detailhandel does not have an engagement policy. The pension fund is considering whether engagement
will be included in the responsible investment approach.
Score: 1 point
No engagement policy.
4.5.5 Voting policy
BPF Detailhandel has implemented a voting policy to govern the exercise of voting rights for all of the direct
equity investments of the pension fund.
When reviewing resolutions proposed at general meetings the proposals are judged against fundamental principles of good corporate governance, while taking into account best practice standards pertinent both to the
relevant market and international markets. These principles include amongst others board composition, executive remuneration and shareholder rights. Next to that the pension fund pays additional attention to shareholders resolutions that are related to environmental and social issues. These are currently dealt with on a
case-by-case basis. Special attention is also paid to shareholder meetings of companies that are included in
the engagement program.
The pension fund makes use of a specialist research provider, the RiskMetrics Group, who provides information concerning up coming shareholders meetings of companies in the equity portfolios. Due to the international character of the pension fund’s equity portfolio it is not possible to attend all general meetings. The
pension fund exercises its voting rights by proxy voting, these services are facilitated by the RiskMetrics Group
as well.
The pension fund is fully committed to communicating its voting activities and discloses its voting conduct on
a detailed level providing information per shareholders’ meeting on its website. Voting reports are available
to the pension fund’s beneficiaries and the general public on both a quarterly an annual basis.
Score: 3 points
The pension fund has an active voting policy that only includes Corporate Governance issues, but does
report on voting and presence at shareholders meetings.
The pension fund has allocated a part of its assets to private equity. The pension fund participates in the
this fund. This is expressed by its strict criteria:
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distribution of weaponry).
●
●
Score: 2 points
The pension fund has a sustainable project financing policy, but does not provide information on
projects and investment size.
The pension fund has outsourced its asset management to Syntrus Achmea Asset Management, that is committed to implement the responsible investment approach and reports to the pension fund on a regular basis.
Score: 2 points
The pension fund is clear about its outsourcing, but does not provide a comprehensive overview of its
external asset managers, nor how they are committed to its responsible investment policy.
BPF Detailhandel does not have an active dialogue related to ESG issues in the investment process. However,
the pension fund has formulated a communication policy, which will be published on the website soon.
Score: 1 point
No active dialogue with society.
The pension fund reports on the implementation of the corporate governance and voting policy on its website:
●
Voting reporting tool (information on each agenda item voted at a shareholders meetings)
●
Corporate governance and Voting report on quarterly basis
●
Corporate governance and voting annual review report.
The exclusion policy is also available on the pension fund’s website.
Score: 3 points
The pension fund only reports on applied instruments and provides insight into its equity holdings
through its voting reporting tool.
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4.6 Bedrijfstakpensioenfonds voor de Groenten- en
Fruitverwerkende industrie
Het Bedrijfstakpensioenfonds voor de Groenten- en Fruitverwerkende Industrie (hereafter called BPF GF) is an
industry-wide pension fund, responsible for implementing the collective pension scheme of about 50 companies
in the processing of vegetables and fruit sector. The pension administration is outsourced to Syntrus Achmea
Pensioenbeheer and asset management to F&C Investment and Syntrus Achmea Vastgoed (Real estate).
Description
Premium income
Active
3 193
Passive
11 988
Pensioners
1 783
Number of employees
-
 107 million
Distribution among investment categories
equity
%
corporate bonds
%
4.6.1
government bonds
%
loans
%
real estate
%
participations
%
other
%
BPF GF has integrated responsible investment in its investment policy, taking into account the legal obligation and developments in society as laid down in the Code Tabaksblat. The policy is based on the policy of
F&C, that takes as a starting point codes such as the OECD Guidelines for Multinational Enterprises and besides corporate governance, mentions the following issues: “fraud, bribery and corruption, climate change,
human rights, labour standards including those in supply chains, and the health impacts of products.”
As a sustainable institutional investor BPF GF actively votes on shareholders meeting and engages with companies it invests in. Priorities for engagement are decided upon each year by the asset manager, based on risks
related to ESG-issues and input of the pension fund. ESG-criteria are also used for selection of investments.
The fund works with an exclusion policy for controversial weapons for investments in equity, credits, high
yield and convertible bonds.
Score: 4 points
Publicly available policy document that considers social and environmental issues, is based on clear
principles and directives and clarifies the use of instruments and covers multiples asset classes.
4.6.2
BPF GF wishes not to invest in companies producing landmines and cluster bombs. An exclusion list is available on request. It is not possible to provide detailed information on holdings of BPF GF because it invests in
common funds.
The fund is also part of a working group with other pension funds, to decide whether other exclusion criteria
should applied on investments as well for example corporate bond and private equity.
Score: 3 points
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The fund also supports the UN Principles for Responsible Investment and decided to sign the principles, but is
not effectuated yet. BPF GF follows the implementation strategy of its asset manager F&C Investments to
integrate ESG-criteria in the selection of investments. F&C has 16 professionals that analyse subjects in the
filed of environment, society and corporate governance, giving an extra dimension to the research analysis of
investments.
The fund also supports the Enhanced Analytics Initiative (EAI), a coalition of asset management companies
and pension funds to stimulate investors to incorporate ESG-criteria in investments selection. BPF GF commits itself to rewarding extra-financial research from research providers by individually allocating a minimum
of 5% of brokerage commissions to extra-financial research.
Score: 3 points
BPF GF has a general statement that ESG-criteria are included in selecting investments. It also
purchases sustainability analysis.
4.6.4
Engagement
BPF GF assigned F&C for engagement to stimulate companies in improving their way of working regarding
environment, society and corporate governance. Through the Responsible Engagement Overlay service (reo),
F&C uses its influence as a major asset manager to encourage better management of environmental, social
and governance risks by companies on behalf its clients. This is done by voting actively on all holdings and
through dialogue.
Structural engagement issues are: environmental management, climate change, working conditions, sustainability management and reporting, human rights, health, business ethics, corporate governance and ecosystem services. Each year the asset manager initiates a priority list of companies they will actively engage and
the issues that will discussed during their conversation.
Reporting takes place both quarterly and annually, to be found on the website of BPF GF.
Score: 4 points
and environmental issues and regularly engages companies in dialogue. The pension fund also reports
on its engagement activities.
4.6.5
Voting policy
The reo-service of F&C also provides voting for BPF FG. The voting policy of F&C is comprehensive and includes guidelines of Code Tabaksblat. The goal is maintaining and improving shareholder value through transparent reporting and accountability by management and board of directors of a company. If F&C votes opposite the recommendations of the Board, they send a letter to the company with an explanation on the reason
to vote against. Where necessary the asset manager will file a resolution.
BPF GF receives monthly, quarterly and annual reports to monitor the results of F&C's voting activities. It
publishes the monthly reports on voting behaviour as well as quarter and annual summaries on its website.
Score: 4 points
The pension fund has an active voting policy that explicitly includes social and environmental issues,
and publishes presence and voting behaviour.
4.6.6
BPF GF is part of a working group to think about investments in sustainable private equity and selection of
ethically screened corporate bonds.
Score: 1 point
No sustainable project financing
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Transparancy on outsourcing
F&C and Syntrus Achmea Vastgoed are BPF GF’s asset managers. The responsible investment policy is implemented by F&C.
Score: 3 points
The pension fund is clear about its outsourcing, and formalizes external party commitment to its
responsible investment policy.
4.6.8
BPF GF cooperates with other pension funds in the working group on responsible investment. Following the
dialogue that the BPF GF has within this working group, feedback is given to pension fund participants, the
board and the investment committee. BPF HGF argues that the SRI policy is an integral part of the investment
and the fund is constantly exploring how this policy can be optimized, but it remains unclear how for example the participant council influences the policy of BPF GF. It also distributed a survey in 2008 among its participants concerning responsible investment.
Score: 3 points
The pension fund on occasion seeks a dialogue with participants and participants. It also seeks a
dialogue (through its asset manager) using international network organisations.
4.6.9
The Annual Report is published on the website and besides that a separate report on responsible investment
is made quarterly and annually, with special attention to engagement and voting activities. The exclusion list
is available on request. It is not possible to provide detailed information on holdings of BPF GF because it
invests in pooled funds.
Score: 2 points
The pension fund reports on applied instruments.
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4.7 Bedrijfstakpensioenfonds voor het Levensmiddelenbedrijf
Bedrijfstakpensioenfonds voor het Levensmiddelenbedrijf (BPF Levensmiddelen) takes care of the pensions of
employees and former employees in the food sector of more than 3,000 related employers. The governing
board of the fund consists of representatives of employers and employees from the sector. Administration and
execution of the pension arrangements is taken care of by Interpolis Pensioenbeheer.
Description
Premium income
 122 million
Active
Passive
150 788
Pensioners
6 775
Number of employees
1
 1.5 billion
equity
corporate bonds
government bonds
loans
real estate
participations
other
4.7.1
58 328
37.7 %
34.5 %
9.8 %
13.4 %
4.6 %
BPF Levensmiddelen has formulated and implemented a responsible investment policy. This approach is
applied to the pension fund’s actively managed equity portfolios. The policy has been launched and implemented as per July 2009. At this moment the pension fund is exploring the opportunities to apply its responsible investment policy to the fixed income portfolios and other asset classes.
The pension fund uses the framework of the UN Global Compact as a guideline for its responsible investment
approach. The Global Compact consists of 10 principles that are related to human rights, labour standards,
environment and anti-corruption.
To effectively implement the responsible investment policy the pension fund uses of four instruments:
-
Screening on the basis of the UN Global Compact;
-
Engagement;
-
Corporate governance (including voting) and;
-
Exclusion.
The policy is available at the pension fund’s website.
Score: 3 points
SRI policy based on UN Global Compact, using multiple instruments, but covering only one investment
category (equity).
4.7.2
BPF Levensmiddelen has an exclusion policy with respect to controversial weapons. The pension fund considers the following type of weapons as controversial:
-
Nuclear weapons;
-
Biological weapons;
-
Chemical weapons;
-
-
Cluster munitions.
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The exclusion of these types of weapons fits within the framework of the pension funds’ social responsible
investment policy. Other than producers of controversial weapons the pension fund does not exclude companies. A formal policy document can be found at the pension fund’s website.
Score: 3 points
Exclusion policy based one issue (controversial weapons), but no publication of excluded companies.
4.7.3
BPF Levensmiddelen screens its investment universe on controversies with the principles of the UN Global
Compact. See also the general document Responsible Investment (Verantwoord Beleggen).
The pension fund is planning on integrating ESG information in its mainstream investment process, as performance on ESG criteria - often not explicitly valued in financial data - can have significant influence on a company’s ability for value creation and risk avoidance.
The pension fund will use research from external data providers, academic research and in house research.
Score: 2 points
Screening of the equity portfolio against the UN Global Compact principles, but no positive selection.
4.7.4
Engagement
Since June 2009, BPF Levensmiddelen is implementing its responsible investment policy, including engagement activities. Engagement with companies is undertaken by Robeco on behalf of the fund, and is focused
on stimulating sustainable behaviour, good corporate governance and increase of shareholder value.
The engagement process starts with an in-depth theme research report on one or more of the Global Compact
principles. Based on this research, engagement targets are set per company. If targets are not met within 3 years,
the pension fund may decide to exclude the company from its investment portfolio. The pension fund will report
semi-annually on its website on its responsible investment activities including engagement activities.
Engagement activities have recently started, and the fund will report on its responsible investment activities
over the second half of 2009 at the beginning of 2010.
Score: 3 points
BPF Levensmiddelen recently started ESG engagement activities, but does not (yet) report on the
companies or the progress.
4.7.5
Voting policy
BPF Levensmiddelen has adopted a voting policy to govern the exercise of voting rights for all of its direct
equity investments.
Proposals at the general meetings are evaluated using the fundamental principles of good corporate governance, while taking into account best practice standards pertinent both to the relevant market and international markets. These principles include board composition, executive remuneration and shareholder rights.
BPF Levensmiddelen also pays special attention to shareholders resolutions that are related to environmental and social issues, and to shareholder meetings of companies that are included in the engagement program.
The pension fund makes use of a specialist research provider, the RiskMetrics Group, that provides information concerning upcoming shareholder meetings of companies in its equity portfolios. Due to the international character of the pension fund’s equity portfolio, it is not possible to attend all general meetings. The pension fund exercises its voting rights by proxy voting, that are facilitated by the RiskMetrics Group as well.
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Score: 3 points
BPF Levensmiddelen has an active voting policy and is clear about the sustainability criteria upon
which it is based. Its voting activities are also publicly available.
4.7.6
BPF Levensmiddelen has allocated a part of its assets to private equity. The fund participates in the Interpolis
Pensioenen Sustainable Private Equity Fund. Responsible investment is an important strategy within this fund.
This is expressed by its strict criteria:
-
Exclusion of sectors (production of pornographic material, tobacco, fur, and the production
-
-
and/or distribution of weaponry).
Score: 2 points
BPF Levensmiddelen invests in sustainable funds, but the amount invested does not exceed 1% of the
fund’s total investments.
4.7.7
BPF Levensmiddelen has outsourced its asset management to Syntrus Achmea Asset Management. Syntrus
Achmea is committed to implement the responsible investment approach and reports to the pension fund on
a semi-annual basis. The responsible investment approach is applicable to equity portfolios that are managed
by Syntrus Achmea Asset Management.
Score: 2 points
Transparency about outsourcing its asset management and responsible investment approach with
Syntrus Achmea.
4.7.8
BPF Levensmiddelen has recently shared its responsible investment policy with its participant council. Topics
like the use of the framework of the UN Global Compact, exclusion on controversial weapons, engagement
strategy, corporate governance and transparency & reporting were discussed. As a result the participant council is fully informed about the responsible investment activities of the pension fund. The pension fund is not
involved in an active dialogue with society in general at the moment.
Score: 3 points
SRI policy discussed with participants, but no structural dialogue with society in general.
4.7.9
BPF Levensmiddelen discloses its responsible investment policy, voting policy and exclusion policy on its website. Voting activities are reported on a quarterly and annual basis. The fund will further report biannually on
activities related to responsible investment once these are fully implemented. The fund plans to report over
the second half of 2009 at the beginning of 2010.
Score: 3 points
The pension fund partially reports on responsible investment.
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4.8 Bedrijfstakpensioenfonds Meubelindustrie en Meubileringsbedrijven
The Bedrijfstakspensioenfonds Meubelindustrie en Meubileringsbedrijven (BPF Meubels) is responsible for the
pension arrangements of companies in the furniture and furnishing companies.
Description
Premium income
Active
3 193
Passive
11 988
Pensioners
1 783
Number of employees
-
 107 million
equity
%
corporate bonds
%
government bonds
%
4.8.1
loans
%
real estate
%
participations
%
other
%
BPF Meubels indicates it has drafted and implemented a socially responsible investment policy, which is based
on widely accepted treaties brought together in the UN Global Compact. This policy is not publicly available.
BPF Meubels invests in equity funds that are part of the Dublin registered SEI Global Master Fund range. As of
January 1st 2009 SEI have appointed F&C reo® as engagement and voting overlay manager. F&C reports to SEI
and its customers on a quarterly basis in a confidential way how it engages with companies. In 2006 F&C was
a founding signatory to the UN Principles for Responsible Investment.
Score: 1 point
BPF Meubelindustrie en Meubileringsbedrijven does not have a public policy document.
4.8.2
Exclusions
BPF Meubelindustrie en Meubileringsbedrijven does not use exclusions as part of the responsible investment
activities, but rather uses the instrument of engagement and voting.
Score: 1 point
No exclusion policy.
BPF Meubelindustrie en Meubileringsbedrijven does not use positive selection as part of the responsible
investment activities, but rather uses the instrument of engagement and voting.
Score: 1 point
No selection of investments based on ESG-criteria.
4.8.4
Engagement
BPF Meubelindustrie en Meubileringsbedrijven indicates it uses engagement as part of its responsible investment activities. This is outsourced to F&C, using the reo service. The criteria for engagement in 2009 are well
stipulated in the (confidential) third quarter report of F&C: they relate to Corporate Governance, Business
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Ethics, Sustainability Management and Reporting, Environmental Management, Climate Change, Ecosystem
Services, Human Rights, Labour Standards and Public Health.
Score: 3 points
BPF Meubelindustrie en Meubileringsbedrijven uses various ESG criteria for its engagement as part of
their responsible investment activities and reports about it.
4.8.5
Voting policy
BPF Meubelindustrie en Meubileringsbedrijven indicates it votes during shareholder meetings by using the reo
service of F&C. The website shows no information on what issues the fund votes on and there are no reports
available. BPF Meubel receives every quarter a detailed overview of voting activity by F&C on behalf of the
holdings in the various SEI Equity Funds. However this report is not publicly available.
Score: 3 points
BPF Meubelindustrie en Meubileringsbedrijven has an active voting policy regarding various issues but
is not publicly available as well as the report it receives from the asset manager executing voting
rights.
4.8.6
It is unclear whether BPF Meubelindustrie en Meubileringsbedrijven directly invests in companies or projects
that are leaders in the field in terms of sustainability as part of the responsible investment activities. BPF
Meubel is not investing directly in companies or projects but uses SEI equity funds that are managed on a multi
manager basis.
Score: 1 point
BPF Meubelindustrie en Meubileringsbedrijven does not have a public policy document or description
of activities.
4.8.7
BPF Meubelindustrie en Meubileringsbedrijven has outsourced its entire asset management to SEI and Syntrus
Achmea including its responsible investment activities.
Score: 2 points
BPF Meubelindustrie en Meubileringsbedrijven provides a full list of its asset managers and provides
insight into how the asset manager complies with and carries out its responsible investment policy.
4.8.8
BPF Meubelindustrie en Meubileringsbedrijven indicates that they implemented a responsible investment policy because participant consider it an important topic and because media indicated that it is a topic that cannot be avoided. This indicates that BPF Meubelindustrie en Meubileringsbedrijven occasionally dialogues with
participants.
Score: 2 points
BPF Meubelindustrie en Meubileringsbedrijven occasionally seeks a dialogue with its participants.
4.8.9
BPF Meubelindustrie en Meubileringsbedrijven reports on its responsible investment policy and implementation on its website and annual report.
Score: 2 points
BPF Meubelindustrie en Meubileringsbedrijven reports on its responsible investment policy but a list
of the companies in which it invests cannot be found.
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2 0 0 9
4.9 Bedrijfstakpensioenfonds Schilders
Bedrijfstakpensioenfonds voor het Schilders-, Afwerkings- en Glaszetbedrijf (BPF Schilders) carries out the pension
arrangements of employees and entrepreneurs in the sectors painting, finishing and glazing. BPF Schilders has outsourced its administration to A&O Services B.V. and its asset management activities to A&O Vermogensbeheer B.V.
Description
Premium income
 148.5 million
Active
Non-active
73 970
Pensioners
33 190
Number of employees
0
 3.4 billion
Equity
Corporate bonds
Government bonds
Loans
Real estate
Other:
4.9.1
42 476
23.3 %
52.3 %
13.4 %
Hedge funds
4.5 %
Infrastructure
2.2 %
Private equity
1.9 %
Commodities
1.6 %
Cash and hedging
0.8 %
BPF Schilders has a socially responsible investment policy that covers its equity portfolio (which makes up 25%
of the total investment portfolio). The policy is currently not publicly available, but can be found in meeting
notes. The website discloses general information regarding the fund’s social responsible investment policy,
which can be described as an exclusion policy. Since 2001 BPF Schilders has been piloting with ethical
investing. In 2007, BPF Schilders decided that the fund does not want to invest any longer in equity of companies that are considered controversial. The fund’s SRI policy has been implemented as of 2008.
Score: 2 points
No publicly available policy document but a clear statement on the website, based on UN principles,
covering one investment category.
4.9.2
BPF Schilders has developed policies regarding the exclusion of controversial investments. BPF Schilders does not
wish to invest in equity of companies that are suspected of undesirable behaviour in the fields of human rights,
labour rights, environment and corruption. Additionally, the fund excludes companies that are involved in the production of cluster munition and anti-personnel mines.
On behalf of the board of BPF Schilders, Dutch Sustainability Research has screened the funds entire equity portfolio, in order to identify controversial investments in the portfolio. Subsequently, all external asset managers
that invest in equity on behalf of BPF Schilders were ordered to remove these controversial investments from
their portfolios. The total weight of controversial investments before being removed amounted to ca. 1% of the
fund’s investments. BPF Schilders has a lists of excluded companies that is updated every quarter.
Score: 2 points
BPF Schilders has an exclusion policy, yet no publicly available document, nor a publicly available list
of excluded companies.
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4.9.3
I N V E S T M E N T
B Y
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F U N D S
I N
T H E
2 0 0 9
BPF Schilders does not have a policy for the selection of investments based on a best-in-class approach. BPF
Schilders will begin implementing phase 2 of its responsible investment policy in the beginning of 2010. This
phase includes positive selection.
Score: 1 point
BPF Schilders has no positive selection procedure based on ESG-criteria.
4.9.4
Engagement
BPF Schilders considers engagement as an important responsibility of the fund, being a final investor. Engagement
is the second instrument (after exclusion) used for implementing a socially responsible investment policy. “The
engagement policy will be formulated in the future; currently there are no policy documents available.”
Score: 1 point
BPF Schilders does not yet have an engagement policy.
4.9.5
Voting policy
BPF Schilders does not have its own voting policy, but the fund is a member of Eumedion. “BPF Schilders is of the
opinion that the size of the fund is too small for an individual voting policy to create added value. For that reason the fund became a member of Eumedion several years ago, so that governance issues can be addressed in a
broader shareholder partnership.”
Score: 2 points
No voting policy, but membership of Eumedion for voting on governance issues.
4.9.6
BPF Schilders will include sustainable project financing in the further development of the fund’s socially responsible investment policy.
Score: 1 point
BPF Schilders does not (yet) undertake sustainable project financing.
4.9.7
BPF Schilders has outsourced both its administration to A&O Services B.V. and its asset management activities to
A&O Vermogensbeheer B.V., which states: “All our asset managers are directly guided by us and have to comply
with our requirements concerning social responsible investments.” There is no publicly available list of external
asset managers.
Score: 2 points
Fund is transparent with respect to its (fiduciary) asset manager, but A&O Asset Management does not
provide the names of its external managers.
4.9.8
BPF Schilders feels the importance of an active dialogue with its participants. Discussions about socially responsible investment have been and are being held with the existing participants council. The participants’
council is actively involved in the development of the responsible investment policy and was also shown the
list of excluded companies. The participants’ council will remain active in the implementation of phase 2 of
the responsible investment policy.
Score: 3 points
Dialogue concerning SRI with participants, but no dialogue with third parties in society.
4.9.9
BPF Schilders reports on its responsible investment performance in its annual report and partly on the fund’s
website. The fund does not provide an overview of all the companies it invests in.
Score: 2 points
Only partial reporting.
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4.10 BPF Schoonmaak
The sector pension fund for (window) cleaners (Stichting Bedrijfstakpensioenfonds voor het Schoonmaak- en
Glazenwassersbedrijf) takes care of the pensions for employees in the cleaning sector. Everyone who works
for an organization or company in these sectors and is above the age of 21 participates in the pension fund.
Description
Numbers (in millions )
Premium income
 157 million
Active
120 455
Non-contributing
499 976
Pensioners
12 072
Number of employees
0
 1.5 billion
Equities
18 %
Fixed income
63 %
Real Estate
14 %
Alternatives
3%
Liquidity
2%
BPF Schoonmaak has formulated a responsible investment policy, which is available on their website. The policy
consists of:
-
Screening of companies based on the UN Global Compact
-
Exclusion
-
Engagement
-
Corporate governance and voting at shareholders meetings
The pension fund uses the principles of the UN Global Compact as framework. The approach has been applied
to the pension fund’s actively managed equity portfolios since 2008.
Score: 3 points
BPF Schoonmaak has a (socially) responsible investment policy that provides insight into the
international standards upon which it is based and the instruments that are used. At this point it
covers one asset class.
4.10.2 Exclusions
BPF Schoonmaak has an exclusion policy with respect to controversial weapons. The pension fund considers
weapons controversial when they cause a disproportionate number of casualties, when they do not make a
distinction between military and civilian targets, and when these weapons cause harm after the conflict has
been terminated. Controversial weapons, such as cluster munitions, have a negative long term impact on both
the economic and social development of a post conflict area. The exclusion of these types of weapons fits
within the framework of the pension funds’ social responsible investment policy.
74
-
Nuclear weapons;
-
Biological weapons;
-
Chemical weapons;
-
-
Cluster munitions.
B E N C H M A R K
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F U N D S
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2 0 0 9
A formal policy document with more background information and a list of companies that were excluded
during 2008 can be found on the website.
BPF Schoonmaak currently only excludes producers of controversial weapons.
Score: 4 points
BPF Schoonmaak currently has a publicly available exclusion policy around one issue: controversial
weapons. The fund also publishes a list of excluded companies.
BPF Schoonmaak will include Environmental, Social and Governance information into its mainstream investment processes in order to improve the risk return profile of the portfolio. This is a result of BPF
Schoonmaaks’ belief that ESG information is often not explicitly valued in financial data, while it can have
financial consequences. To this end, BPF Schoonmaak makes use of research from external (ESG) data providers, academic research as well as in-house research.
Score: 2 points
BPF Schoonmaak states that it incorporates ESG-criteria into its investment strategy.
4.10.4 Engagement
BPF Schoonmaak enters into a dialogue with companies to stimulate companies to adopt sustainable behaviour and good corporate governance and to increase shareholder value. The principles of the United Nations
Global Compact are used as a framework when entering into dialogue with companies as these offer companies a framework for corporate responsibility. In 2008, BPF Schoonmaak centred its engagement around several themes: forced labour and human rights, environment, corruption and controversial regimes for companies involved in the energy and commodities sector. Its engagement activities are published on its website.
The engagement process starts with an in depth theme research report. Engagement targets are then set per
company based on the research. If targets are not met within 3 years, the pension fund may decide to exclude the company from its investment portfolio. The pension fund reports on its website concerning its responsible investment activities including engagement activities on a semi-annual basis.
Score: 4 points
BPF Schoonmaak has an engagement policy that takes deliberately chosen social and environmental
issues into account and regularly engages with companies. It also reports on these activities.
4.10.5 Voting policy
BPF Schoonmaak has adopted a voting policy to govern the exercise of voting rights for all of its direct equity investments.
BPF Schoonmaak also pays special attention to shareholders resolutions that are related to environmental and
social issues, and to shareholder meetings of companies that are included in the engagement program.
The pension fund makes use of a specialist research provider, the RiskMetrics Group that provides information
concerning upcoming shareholder meetings of companies in its equity portfolios. Due to the international character of the pension fund’s equity portfolio, it is not possible to attend all general meetings. The pension
fund exercises its voting rights by proxy voting, that are facilitated by the RiskMetrics Group as well.
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Score: 3 points
BPF Schoonmaak has an active voting policy and is clear about the sustainability criteria upon which
it is based. Its voting activities are also publicly available.
BPF Schoonmaak has allocated a part of its assets to private equity. The pension fund participates in the
-
distribution of weaponry.
Score: 2 points
BPF Schoonmaak has a sustainable project-financing portfolio, but it is unclear what the value
of these investments is.
BPF Schoonmaak has outsourced its asset management to Syntrus Achmea Asset Management. Syntrus Achmea
Asset Management is committed to implementing the responsible investment approach and reports to the pension fund on a semi-annual basis.
Score: 2 points
BPF Schoonmaak provides clarity into its asset managers and provides insight into how the asset
BPF Schoonmaak has formulated and implemented a communication policy. An abstract of this policy is available on the website. Responsible investment is not explicitly addressed in the policy. The pension fund is not
involved in an active dialogue with society at the moment.
Score: 2 points
BPF Schoonmaak engages in dialogue with its participants.
BPF Schoonmaak publishes its voting policy and its exclusion policy on its website. The responsible investment
policy is expected to be published on the website. The pension funds reports on its activities related to responsible investment on a semi-annual basis.
With regards to its voting activities, BPF Schoonmaak reports on a quarterly and annual basis on corporate
governance and voting activities. An online tool is used to report on the pension funds’ voting activities for
each shareholder meeting.
Score: 3 points
BPF Schoonmaak reports on a number of its applied instruments.
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2 0 0 9
4.11 Pensioenfonds Vervoer
Stichting Bedrijfstakpensioenfonds voor het Beroepsvervoer over de Weg (Pensioenfonds Vervoer) carries out
the pensions of employees in the sectors Freight, Private Bus transport, Taxi transport, Mobile Cranes rental
and Domestic Shipping. As of January 1st 2010, Pensioenfonds Vervoer has outsourced its pension administration to TKP Pensioen B.V.
Description
Premium income
 548 million
Active
184 357
Passive and Pensioners
382 126
Number of employees
6
 6 billion
equity
33.0 %
corporate bonds
20.5 %
government bonds
19.0 %
loans
real estate
7.5 %
participations
other
20.0 %
Pensioenfonds Vervoer’s responsible investment policy has been formalized in the document “Verantwoord
Beleggen bij Pensioenfonds Vervoer 2008 - Op weg naar duurzame groei”. The fund has based its policy on
various international guidelines in the areas of Human Rights (UN), labour conditions (ILO) and controversial
weapons (Ottowa).
In principle, the policy covers the entire investment portfolio. With the implementation of the exclusion policy, the fund started with excluding equity quoted on the stock exchange, and added corporate bonds in 2008.
Engagement and managers’ assessment is being applied to the equity portfolio. Additionally, objectives and
activities for 2009 have been formalized in an internal nota, of the key aspects are published on the fund’s
website.
Pensioenfonds Vervoer signed the UN PRI early 2008 and participates in the PRI initiatives.
Score: 5 points
The fund has a fully comprehensive policy, based on international principles and directives and is
publicly available on the fund’s website.
Part of Pensioenfonds Vervoer’s responsible investment policy consists of exclusion. The pension fund excludes investments in parties that are substantially involved in the production of controversial weapons (antipersonnel mines and cluster munitions) as well as companies that strongly violate one or several of the principles of the UN Global Compact. Moreover, the fund does not want to invest in activist hedge funds, because of their possible negative impact on e.g. employment.
Since May 1st 2009, 18 companies were excluded from the investment portfolio (2 based on violation of labour
rights, 1 based on violation of human rights, 1 based on creating environmental damage, 1 because of controversial activities in Sudan and Myanmar, and 13 based on involvement in controversial weapons). The list
of controversial companies is updated semi-annually and published yearly.
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2 0 0 9
Score: 5 points
Exclusion policy based on various international agreements such as Global Impact and the Ottawa
Convention. A list of excluded companies is published online.
Pensioenfonds Vervoer has signed the UN PRI and “chooses strongly for integration of ESG-criteria”. The fund
has decided not to use a best-in-class approach, because they “do not expect added value in terms of improvement of risk/return and because they want to see their managers combine their current strategies with responsible investment activity instead of only selecting sustainable/SRI managers”. Pensioenfonds Vervoer
investigates the capacity of the active equity managers to integrate ESG-criteria in their investment process
on a yearly basis (see details in 4.11.7). The financial performance of the managers that score high on ESG
criteria is such that expansion of the assessment to other asset classes is being considered.
Score: 3 points
Signatory of UN PRI, and ESG-criteria used for the selection of the equity portfolio.
4.11.4 Engagement
The engagement policy of Pensioenfonds Vervoer is embedded in the Governance Platform of Déminor. Reports
of the engagement dialogues are considered and treated as confidential, and hence not made available to the
public. The Governance Platform has expanded its engagement activities in 2009, now including environmental and social criteria in the dialogue.
Besides, Pensioenfonds Vervoer has signed the Carbon Disclosure Project in cooperation with the UN PRI, and
has sent a letter to the ILO concerning forced child labour in the cotton sector in Uzbekistan.
Score: 3 points
Engagement with companies does not explicitly include environmental or social issues (see website
Governance Platform).
Pensioenfonds Vervoer’s voting policy is developed and implemented. Issues of importance within the policy
are independence of governance, reward structures and transparency about responsible entrepreneurship.
From the first quarter of 2009 onward, the fund has published quarterly reports on its voting activity, which
will be published on the website before the end of the year. In the first two quarters of the year, the fund
has voted in 88% of the shareholder meetings. The fund has voted in favour of 85% of the management proposals, and with 15% of the shareholders proposals. The fund has not formulated any shareholder motions
regarding corporate social responsibility.
Whereas the fund will vote in favour of more transparency about CSR issues, it treats shareholder resolutions
in favour of promoting better conduct with respect to ESG issues on a case by case basis through informed
voting. The pension fund will vote in favour of these resolutions if there is a proper balance between the interests of the company and society. In some cases, these resolutions are contrary to the best interest of the
company, shareholders and even society because they are launched by special interest groups.
Pensioenfonds Vervoer publicizes a summary of its voting record for every quarter on its website.
Score: 4 points
Pensioenfonds Vervoer has an active voting policy including ESG-criteria. It also reports on its voting
activities.
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2 0 0 9
In 2008 Pensioenfonds Vervoer researched the investment possibilities in micro financing and committed  30
million to a Microfinance fund of SNS Asset Management. In 2009 the fund researched a participation in a
clean-tech fund, but this hasn’t led to a commitment.
Score: 2 points
Current investments in social and sustainable investment funds amount to less than 1% of the
investment portfolio.
Pensioenfonds Vervoer has appointed Goldman Sachs as fiduciary manager. Goldman Sachs manages 83% of the
investment portfolio. The remaining 17% is managed by Achmea Vastgoed, which invests 7,5% in real estate
and 7,5% in mortgages and 2% in two infrastructure investments (Bouwfonds and Q Park).
In cooperation with the fiduciary manager Goldman Sachs Asset Management, Pensioenfonds Vervoer investigates the capacity of the active share managers to integrate ESG-criteria in their investment process on a
yearly basis. The inquiry includes the quality of the team, availability of information, risk management, performance and the involvement of the management. In all these fields, the managers show progress in 2009
relative to 2008, especially in risk management in which ESG criteria play a relatively large role. The financial performance of the managers that score high on ESG criteria is such that expansion of the assessment to
other asset classes is being considered.
Score: 3 points
Pensioenfonds Vervoer provides transparency concerning outsourcing of asset management. The fund
does not communicate to the public about the ESG-agreements made with the asset managers, but
the fund is very pro-active in educating the asset managers in integrating ESG criteria in their
investment decisions.
Pensioenfonds Vervoer involves participants in a dialogue via existing channels such as the governing board
and the participants council.
Score: 2 points
Continuous dialogue with its participants, but no structural dialogue concerning social and
environmental issues.
The policy and activities regarding responsible investment and the list of excluded companies are published
on the fund’s website for participants, stakeholders and interested third parties. Progress on policies and activities are reported in the annual report and on the website. The fund does not publish an overview of all the
companies in which it invests.
Score: 2 points
Publication of general SRI objectives, policies, and instruments on the fund’s website. There is no list
of the companies in which it invests.
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2 0 0 9
4.12 Bedrijfstakpensioenfonds SBZ
Stichting Bedrijfstakpensioenfonds Zorgverzekeraars (SBZ) is an industry pension fund for employees in the
health insurance sector.
Description
Premium income
 112 million (net)
Active
16 945
Passive
20 167
Pensioners
Number of employees
23
 2 256 million
5 514
Equity
27.2 %
Fixed income
46.6 %
Derivatives
12.3 %
Real estate
9.7 %
Other
4.0 %
According to the Annual Report 2008, SBZ has renewed it responsible investment policy, focusing on its responsibility as an institutional investor to change situations that violate ESG-issues. The instruments are not
solely based on exclusion but also on engagement, recognizing that, if engagement does not lead to the desired outcome disinvestment will follow. SBZ has assigned Robeco as engagement and voting manager, to execute this policy, effective from January 2009.
Also in its Beleggingsbeginselen (Investment Principles) the intention is to take into account ESG-issues, but
in both documents the actual principles and guidelines these issues are based upon remain unclear.
Score: 2 points
Publicly available documents that state that responsible investment is important. The principles and
issues are unclear.
Annual report speaks about a former exclusion policy, but content of it is unclear
Score: 0
No information found and no answer provided.
Score: 0
4.12.4 Engagement
Engagement is an important tool of the responsible investment policy and linked to its exclusion policy. The
engagement policy is based on international principles such as the UN Global Compact. This policy does not
seem to be publicly available.
Score: 3 points
The pension fund engages companies in dialogue, and is clear about the criteria on which priorities are based.
It does not report externally on its engagement activities.
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F U N D S
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T H E
2 0 0 9
Engagement manager Robeco is assigned to execute voting rights of SBZ. The SBZ website states that it votes
based on corporate governance issues.
Score: 2 points
The pension fund limits its voting policy to corporate governance issues.
Score: 0
4.12.7 Transparency on outsourcing
Both Fortis Investments (Lead Overlay Manager) and Russel Investment Group (Manager of Managers) are the
fiduciary asset managers of SBZ. Robeco is the engagement manager, executing the responsible investment
policy by voting and engaging with companies.
Score: 2 points
The pension fund is clear about its outsourcing.
According to the Annual Report 2008, the participants council was involved in the development of a renewed
Score: 3 points
The pension fund occasionally seeks dialogue with participants on responsible investment, but the
influence on the policy is unclear.
The annual report provided information on decisions regarding the responsible investment policy and activities.
Score: 2 points
Only partial reporting on responsible investment.
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2 0 0 9
4.13 Molenaarspensioenfonds
Stichting Molenaarspensioenfonds (MPF) is the compulsory industry-wide pension fund for the grain processing
sector (unless dispensation is granted to them). Currently about 30% of employers are affiliated with the MPF.
MPF has outsourced its activities to PVF Achmea, subsidiary of Syntrus Achmea. In august 2009 MPF has established a participants council.
We could not find any information on the internet about is responsible investment policy, MPF does not have
a website, and there was no response to the questionnaire.
Description
Premium income
-
Active
-
Passive
-
Pensioners
-
Number of employees
-
-
equity
%
corporate bonds
%
government bonds
%
loans
%
real estate
%
participations
%
other
%
MPF has a responsible investment policy that covers its role as active owner and states that Aegon Investment
Management’s responsible investment policy applies to its investments.
Score: 2 points
MPF has a vague responsible investment policy.
Score: 0
Score: 0
4.13.4 Engagement
Score: 0
Score: 0
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T H E
2 0 0 9
Score: 0
Score: 0
Score: 0
MPF makes use of Syntrus Achmea and Aegon Investment Management.
Score: 1 point
MPF provides limited insight into its outsourcing.
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2 0 0 9
4.14 Pensioenfonds Architectenbureaus
Pensioenfonds Architectenbureaus is an industry-wide pension fund for employees in the architectural sector.
It has outsourced its activities to Syntrus Achmea.
Description
Premium income
-
Active
13 860
Passive
24 600
Pensioners
8 100
Number of employees
-
 2.5 billion
equity
40 %
fixed income
39 %
convertible bonds
2.5 %
commodities
3.5 %
real estate
15 %
In its investment policy 2008, published on the website the fund expresses its wish to pay more attention to
social responsible investment. Because the fund invests in funds only it has limited influence on companies
and cannot exercise voting rights. The fund can only select asset managers that take ESG-criteria into
account, for example those that have signed UN PRI. It also decided to assign a fiduciary manager and develop its own responsible investment policy.
Score: 1 point
Policy in development
Score: 0
Score: 0
4.14.4 Engagement
Score: 0
Because the fund invests in funds only it has limited influence on companies and cannot exercise voting rights.
It therefore has not developed its own voting policy but follows the voting policy of the funds invested in.
Score: 1 point
Score: 0
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Administration is outcourced to Syntrus Achmea, asset management to:
•
ABN AMRO Asset Management
•
Achmea Vastgoed
•
Cordares Vermogensbeheer
•
F&C Netherlands
•
Fortis Investments
•
ING Investment Management
•
Rabobank Investment International Banking Services
•
Robeco Asset Management
•
SNS Asset Management
•
State Street Global Investors
Only asset managers are chosen that have signed the UN PRI. In 2008 the fund decided to assign a fiduciary
asset manager that will help to select asset managers that integrate ESG-criteria in selection of investments.
Score: 2 points
The fund provides a comprehensive overview of asset managers and states how they are selected.
Score: 0
Score: 0
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4.15 Pensioenfonds Horeca en Catering
Pensioenfonds Horeca & Catering (PH&C) is the pension fund for the hospitality and catering branch. PH&C is
a top 10 pension fund in the Netherlands, with respect to number of participants and employers (29,000).
Description
Premium income
 236 million
Active
219 157
Passive
569 975
Pensioners
25 454
Number of employees
150
 2.5 billion
Equity
32.5 %
Corporate bonds
18.2 %
Government bonds
21.8 %
Loans
8.7 %
Real estate
9.7 %
Participations
4.3 %
Other
4.8 %
During the summer of 2007, PH&C researched the interest of about 400 employees and employers in the hospitality branch had with respect to socially responsible investment. From the inquiry followed that themes
like child labour and governance were important amongst the fund participants. Additionally, a vast majority
found it very relevant to be informed by the fund about its social responsible investment. Finally, it became
clear that for the majority, good returns on investment are considered the single most important guideline
for any investment policy.
Based on these insights, the pension fund has chosen for an exclusion policy from January 2008 onward. This
exclusion policy covers not only the equity portfolio, but also bonds and convertible bonds. Besides, the fund
will reserve funds for special investments concerning social or environmental projects and themes.
Reporting of the investment policy and actual investments takes place via the fund’s annual report and website.
Score: 3 points
Publicly available policy documents show a SRI policy that is not explicitly based on principles and
directives, but covers multiple investment categories and clarifies the use of instruments.
Since January 1st 2008, PH&C has carried out an exclusion policy conform the Norwegian government pension fund policy. Since November 2004, this fund has had an ethical commission independent from the
Norwegian Ministry of Finance, which advises the fund about companies to be excluded from investment. This
commission is regarded as leading in the field.
Criteria for exclusion are amongst others the production of weapons that violate the fundamental humanitarian principles, serious violation of human rights, such as child labour, and severe environmental pollution.
The exclusion policy covers investments in equity, bonds and convertibles quoted on the stock exchange, and
as far as they are not taking place via fund investments.
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A list of excluded companies is available on the PH&C’s website.
Score: 5 points
Exclusion policy based on the Norwegian Global Pension Fund, covering multiple social and
environmental criteria. List of excluded companies available on the fund’s website, does not apply to
pooled funds.
Since several years, the equity portfolio is screened every two years to determine whether it still complies
with sustainability criteria. In the fall of 2006 such a screening determined that the portfolio is relatively
sustainable compared to market average. The criteria used for the screening relate to the following aspects:
• social aspects (labour and human rights guidelines, investments in dictatorial regimes);
• economic aspects (wealth and employment generation based on sustainable production processes);
• ecological aspects (environment-, nature- and animal- friendliness).
Score: 2 points
PH&C describes the use of ESG-criteria for scanning the equity portfolio. However, criteria are very
general and not used in a best-in-class approach.
4.15.4 Engagement
In the upcoming years, PH&C will think about forms of engagement (involvement with corporate governance)
in cooperation with third parties. The fund has reserved funds for this objective in the investment policy.
Score: 1 point
Engagement policy not yet developed.
PH&C is a member of Eumedion. In July 2008, the managers have received the mandate to base the voting on
shareholder meetings on voting guidelines valid for both Dutch and international shareholder meetings.
PH&C finds it important that the managers stick as closely as possible to the voting policy that the fund has
developed, and has therefore developed voting guidelines. These guidelines leave space for deviation in individual situations. Deviation is possible when the company can convincingly explain why it hasn’t been compliant with the guidelines.
The fund’s website gives insight in the shareholder meetings where PH&C has been represented, which issues have been raised, and how the fund has voted.
Score: 3 points
Voting policy including governance, but not explicitly including social and environmental issues.
Voting behaviour is reported on the fund’s website.
PH&C analysed nine different investment categories in 2008 for a portfolio of thematic investments. These
are investments that can make a positive contribution to certain ESG themes like the environment. Out of
these original nine investment categories, the board of trustees has chosen to further examine clean tech and
healthcare related real estate. PH&C is aiming to start investing in clean tech at the end of 2009. PH&C will
ensure that these investments are sustainable and undisputed.
Score: 1 point
No sustainable project financing (yet).
On the website of PH&C, a list of asset managers can be found:
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Acadian Asset Management, Boston – United States of America
•
Allianz Global Investors, München - Germany
•
AlpInvest Partners – the Netherlands
•
BlackRock, New York - United States of America
•
Cohen & Steers, New York - United States of America
•
F&C, Amsterdam/London - United Kingdom
•
Goldman Sachs Private Equity Partners, New York - United States of America
•
HarbourVest Partners, Boston - United States of America
•
Robeco Asset Management – the Netherlands
•
SPF Beheer – the Netherlands
•
State Street Global Advisors, London – United Kingdom
•
Syntrus Achmea Vastgoed – the Netherlands
•
T. Rowe Price Global Investment Services, Baltimore - United States of America
•
Vanguard, Waterloo, Belgium
•
Western Asset Management, London - United Kingdom
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PH&C also states that it “has set constraints on asset managers in the area of socially responsible investments.
They are supplied with a regularly updated list of companies that must be excluded from their investment
portfolios.”
Score: 2 points
The fund shows an overview of asset managers and communicates how asset managers are bound to
the fund’s investment policies.
PH&C has inquired the opinion of its participants on social responsible investment by telephone interviews. The
findings of this study formed an important impulse for the development of a responsible investment policy.
Score: 2 points
Initial interviews with participants, which partly shaped the current SRI policies, yet no sign of the
development of a continuous SRI-dialogue with participants or third parties in society.
PH&C is transparent on the responsible investment policy currently being undertaken and still under development, and gives insight in the instruments being used. Information on presence at the shareholder meetings can be found in reports on the fund’s website. The website also provides information on the investment
categories in which is being invested.
Score: 2 points
Partial reporting on investment categories and instruments, yet no detailed insight in the parties the
fund invests in.
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4.16 Pensioenfonds Medewerkers Apotheken (PMA)
The pension fund for the employees of pharmacies (PMA) is a sector pension fund that provides pension fund
services for these (ex) employees of pharmacies.
Description
Premium income
 56.7
Active
22 745
Non-contributing
9 244
Pensioners
3 719
Number of employees
20
 945 mln (1/7/’09)
Equity
333
Corporate bonds
109
11.5 %
Government bonds
295
31.2 %
152
16.1 %
Loans
35.3 %
-%
Real estate
Participations
Other
-%
56
5.9 %
PMA has a publicly available responsible investment policy. This policy states that the pension fund strives to
achieve optimal financial performance while caring for social, environmental and ethical aspects. This policy
covers all of its investment categories and is in line with the UN PRI.
Score: 3 points
PMA has a responsible investment policy that considers social, environmental and ethical aspects. This
policy covers all of its investments and clarifies the use of instruments. It is not clear whether it is
based on international principles and directives.
The vast majority of PMA’s portfolio is invested in pooled funds. This makes it difficult for PMA to define an
exact and detailed list of which investments should be excluded, because to a certain extent PMA has to follow the managers. For this reason PMA does not have an explicit exclusion list. Instead, the external managers are monitored with respect to their SRI policy.
This policy is discussed in the semi-annual meetings that are held with all the external managers. It is made
clear to the managers that PMA’s standpoint is to invest in a sustainable way. It does also actively invest in
funds that have an explicit SRI policy, making use of either exclusions or a best-in-class approach.
Score: 2 points
PMA has an exclusion policy in which is stated that it does not make use of exclusions due to the fact
that the vast majority of its equity holdings are via pooled funds. It does invest in pooled funds that
make use of exclusions.
PMA has increased the investments with external managers that include explicit ESG criteria and managers
that use a best-in-class approach. About 20% of the equity investments are through funds that have an expli-
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cit SRI policy, either through exclusion or a best-in-class approach, as well as funds that focus on sustainable
themes. PMA will gradually increase these positions further. Because PMA invests in pooled funds, PMA is not
in the position of writing an own detailed policy with ESG criteria that managers have to follow.
Score: 3 points
PMA applies ESG criteria to the selection of investments within specially developed funds with a
best-in-class approach.
4.16.4 Engagement
Because PMA does not invest directly in companies, it is not possible to undertake engagement activities
towards individual companies. The asset managers, however, are required to report on their engagement activities regularly.
Score: 2 points
PMA does not directly engage in dialogue with the companies, but does require its asset managers to
do so. It does not report on the engagement activities of its asset managers.
Because PMA does not invest directly in companies, it is not possible to undertake voting activities towards
individual companies. The asset managers, however, are required to report on their voting activities regularly. PMA is also a member of Eumedion.
Score: 2 point
PMA does not vote, but does require its asset managers to do so. It is also a member of Eumedion.
Besides PMA’s policy to switch to sustainable funds when possible in the entire portfolio, it has reserved 5%
of its total investment portfolio to invest in companies that have a very high sustainability relevance.
Currently, it has invested 3.5% of its portfolio in this way. PMA has done that by investing in:
a fund that is focused on the global ecology market;
a fund that is focused on water and climate;
four microfinance funds.
Score: 4 points
PMA does have an active sustainable project financing policy, and invests more than 2% of its
portfolio in these types of investments.
4.16.7 Transparancy in outsourcing
PMA outsources asset management almost completely, but selects the external managers itself. This is also
the case for its social responsible investments. One of the important criteria in the general manager selection procedure is the manager’s SRI policy and its expertise on ESG criteria. PMA has outsourced the activities
in the field of social responsible investment to:
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Insinger de Beaufort
-
Theodoor Gilissen
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Kempen
-
Pioneer
-
Delta Lloyd
-
Finethic
-
ResponsAbility
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SNS
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Triodos
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Because PMA uses its SRI policy as a selection criterion when selecting the external managers, they all follow
PMA’s SRI policy. Some of these managers use exclusion criteria, some use a best-in-class approach and others
invest in companies with a high sustainability relevance.
Score: 2 points
PMA provides clarity about the asset managers for its SRI investments and formalizes external
manager commitment to its responsible investment policy.
PMA is often a speaker on seminars/workshops on socially responsible investing. PMA also sends an information magazine to its participants periodically, in which socially responsible investing is an important issue. In
2007 PMA organised a symposium to celebrate its 50th anniversary that was completely focused on sustainable investing.
Score: 4 points
PMA active seeks a dialogue with its participants as well as other members of society.
PMA’s responsible investment policy is extensively described in its annual report that is available for download on the website. PMA does not have an overview of all companies that is invested in on the website. It is
possible to receive a list of the funds in which PMA is invested.
Score: 2 points
PMA reports on its responsible investment portfolio, but does not have a publicly available list of the
companies/funds it invests in.
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4.17 Pensioenfonds Metaal en Techniek (PMT)
The pension fund metal and technology (PMT) is a sector pension fund that provides pension fund services for
a large number of companies in the metal and technology sectors.
Description
Premium income
 1 644
Active
424 940
Non-contributing
617 322
Pensioners
157 691
Number of employees
 28 096
Bonds
 15 013
53.4%
Equity

5 234
18.6%
Real estate

3 874
13.8%
Alternatives

3 975
14.2%
PMT has a publicly available responsible investment policy. This policy is based on a number of international
principles and directives such as the UN PRI, the ILO Core Conventions, and the Universal Declaration of
Human Rights. In 2008, PMT began to implement eight criteria that companies included in the investment universe must adhere to that cover topics such as company strategy, human rights, labour rights, and the environment.
This policy contains the following elements:
•
Integration of ESG-criteria into all asset classes
•
Exclusions
•
Voting
•
Engagement
•
Transparancy
•
Class actions other forms of compensation
•
The mandate of PMT’s asset manager Mn Services using yearly planning.
Score: 5 points
PMT has a responsible investment policy that considers social, environmental and ethical aspects and is
based on various international guidelines and principles. This policy covers all of its investments and
clarifies the use of instruments.
PMT has a clearly defined exclusion policy that makes a distinction between violations that occur as a result
of the company’s product or its process. A company controversial product leads directly to exclusion while a
controversial process first leads to engagement by PMT and then possible exclusion.
Throughout 2009, the exclusion is being expanded to products that are in violation of international agreements that the Dutch government has signed.
Score: 4 points
PMT has a clearly defined exclusion policy concerning various social and environmental issues, but
does not have a list of excluded companies.
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PMT integrates ESG-criteria into all of its asset classes, but the implementation of the criteria varies. PMT has
joined the Enhanced Analytics Initiative (EAI) and uses two ESG research providers for exclusion engagement
activities. Its ESG policy can be found on its website and annual report, and is based upon international principles like the UN Global Compact and the OESO Guidelines.
Score: 3 points
PMT has a publicly available ESG policy and provides details into the concrete activities that it takes
in order to carry out this policy.
4.17.4 Engagement
PMT’s engagement policy is geared towards companies with activities that violate PMT’s responsible investment policy. This engagement can lead to possible exclusion. PMT uses a number of engagement service providers such as Mn Services and F&C Investments. PMT also carries out engagement with a number of companies listed on the Dutch stock exchange and a few companies in which it has a strategic holding. Engagement
activities are reported for every quarter on the PMT website.
Score: 5 points
PMT has a clear engagement policy based on a number of social and environmental issues. This
engagement policy is linked to possible exclusion. Reporting of its engagement activities is available
on the website.
PMT makes use of its voting power for all of its equity holdings and uses its responsible investment policy as
basis. There is an emphasis placed on four ILO principles (working conditions, workers’ rights, child labour,
forced labour) as well as other principles concerning workers’ health and safety. This policy also takes the
subcontractors and other in the value chain into account. The responsible investment policy is also implemented for environmental and executive compensation issues. PMT has taken part in shareholder resolutions
through its service provider F&C, and in 2008 brought up its own shareholder resolution for Wal-Mart through
its asset manager. Since april 2008, Mn Services has the responsibility of carrying out PMT’s voting policy.
PMT’s voting record is available and updated regularly on its website.
Score: 5 points
PMT has a clear voting policy, makes use of its voting power and supports shareholder resolutions. Its
voting record is publicly available and updated regularly.
PMT does invest in initiatives that are part of the ‘sustainable project’ initiative, but this is not a separate
investment category. These exist, rather, in its existing asset classes. Within its private equity portfolio, it
invests in clean tech and renewable energy.
Score: 2 points
PMT does invest in sustainable projects, but does not provide information on projects and investment
size.
PMT makes use of Mn Services for all of its asset management. This company manages PMT’s portfolio according to its responsible investment portfolio. Mn Services is responsible for making sure that its own asset
managers adhere to PMT’s responsible investment policy.
Score: 3 points
PMT provides insight into the asset managers it uses for its investments and formalizes external
manager commitment to its responsible investment policy.
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PMT communicates its responsible investment policy on its website, PMT periodicals, and during meetings
with its participants and employers.
Score: 2 points
PMT informs its participants and others about its responsible investment policy.
PMT has a publicly available responsible investment policy. It also publishes a record of all its equity holdings,
its voting policy and record as well as its engagement activities.
Score: 4 points
PMT publishes a list of all its equity holdings and reports on its exclusion, voting, and engagement
activities.
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4.18 Stichting Pensioenfonds Openbaar Vervoer
Stichting pensioenfonds openbaar vervoer carries out the pension arrangements of all employees of the Dutch
Public transport sector. The pension administration is outsourced to SPF Beheer.
Description
Premium income
 68
17 000
Number of employees
0
 2 000
Equity
20 %
Corporate bonds
40 %
Government bonds
25 %
Loans
5%
Real estate
8%
Participations
2%
Other
1%
On its website, SPOV explains its policy regarding social responsible investment (SRI). The policy is based on
the UN Global Compact and UN PRI. SPOV describes several themes, which are focus areas for the SRI policy,
and describes instruments that (can) be deployed. The SRI policy covers the equity portfolio and other investment categories, amongst which corporate and government bonds and private equity. The policy for real estate is currently being developed.
Score: 4 points
Publicly available responsible investment policy based clear principles and covering all but one
investment category.
The SPOV SRI policy states that the fund will not invest in certain companies, “based on the principles of
Global Compact and additional requirements in the areas of child labour, environment and human rights”.
Score: 4 points
SPOV has a publicly available exclusion policy concerning various social and environmental issues.
A list of excluded companies concerning one issue is available on the website.
SPOV has signed UN PRI, and states on its website that it includes ESG criteria in its guidelines for investment.
It also has a strategically allocated asset portfolio that makes use of positive selection. This accounts for
approximately 16% of the equity portfolio.
Score: 3 points
Signatory of UN PRI and general statement of considering ESG-criteria in investment selection, as well
as a specially developed fund that incorporates a best-in-class approach.
4.18.4 Engagement
SPOV has an engagement policy based on the principles of UN Global Compact. In the annual report, several
names are listed of companies that were part of the engagement programme in 2008. The engagement policy is
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related to the exclusion policy.
Score: 4 points
Engagement based on UN Global Compact, and reports on its activities in the annual report. The
results of engagement activities are not mentioned, but engagement is linked to the exclusion policy.
SPOV has a clear ESG voting policy and actively votes during shareholder meetings (via SPF Beheer). The guidelines for voting on shareholder meetings (with respect to ESG-criteria) are publicly available. The fund’s
voting behaviour is being published online as of early 2008. From these reports it becomes clear that the fund
supported 73 out of 117 resolutions that were related to environmental and social issues.
Score: 4 points
SPOV has a publicly available voting policy specifically addressing ESG issues, and publishes presence
and voting behaviour during shareholder’s meetings on its website.
SPOV actively searches and develops possibilities to invest sustainably in a number of special funds. It has,
for example, set up a fund that includes a project in Mali in cooperation with the Dutch Koninklijk Instituut
voor de Tropen (KIT). The total amount currently invested in sustainable projects and companies is around 5
million, comprising a microfinance fund. This is less than 1% of the fund’s total investment portfolio.
Score: 2 points
No policy on sustainable project financing, but does provide information on project and size of
investment. Current investments in sustainable projects amount to less than 1% of the total
The equity portfolio of SPOV is managed by SPF Beheer which manages the majority of the portfolio internally
while also using external asset managers for some of its investments. The names of the external managers are
published online every quarter, and the external asset managers have to comply to the Ethical Code as stated by the SPOV.
Score: 3 points
SPOV is transparent about its external asset managers and the ethical code these parties have to
comply with.
SPOV actively engages its participants in a dialogue, amongst others concerning responsible investment. The
fund also offers various presentations and courses with space for interaction, in which the topic of social responsible investment is being discussed. Additionally, the pension fund cooperates with the KIT in a shared project in
Mali.
Score: 4 points
Active engagement of participants and (albeit few) other representatives of society.
Each quarter, SPOV publishes a list of all the companies the fund invests in on its website. This lists covers
both direct investments as via external asset managers. No insight is provided in other investment categories.
The fund reports on responsible investments and the instruments used on its website and in the annual report.
Score: 4 points
The pension fund publishes a detailed overview of companies within one investment category in which
investments are made and reports on all applied instruments and results.
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4.19 Pensioenfonds PNO Media
The Pensioenfonds PNO Media is a sector pension fund that provides pension fund services for approximately
374 companies and organisations within the media sector.
Description
Premium income
Active
14 914
Non-contributing
14 246
Pensioners
Number of employees
-
 2 500
6 447
Equities
34 %
Government bonds
31 %
Other bonds
10 %
Commodities
Real estate
1%
16 %
Infrastructure
1%
Private equity
7%
PNO Media has a detailed responsible investment policy. This policy has been recently updated, launched and
communicated. All investments in all asset classes must adhere to PNO Media fundamental principles:
-
respect human rights
-
respect workers’ rights
-
counteract corruption
-
protect the environment and climate
-
exclude controversial weapons
-
respect corporate governance norms
-
respect animal welfare norms
These criteria are all based on international principles and directives. The policy also highlights the instruments used to implement the policy: exclusions, engagement, and voting. PNO Media makes use of Hermes
Equity Ownership Services (EOS) when implementing its responsible investment policy. This service is part of
the BT Pension Scheme, the largest corporate pension fund in the UK.
Score: 5 points
The Pensioenfonds PNO Media has a detailed responsible investment policy that considers a range of
environmental and social criteria, is based on clear principles and directives, covers all investment
categories and clarifies the use of instruments.
4.19.2 Exclusions
The Pensioenfonds PNO Media excludes companies or countries when:
-
One of the primary activities of the venture is not in agreement with its fundamental principles
It becomes evident through reliable sources that the activities of the company or government are in
structural and serious violation of its fundamental principles
-
The activities of the company or government are in serious violation of the fundamental principles
and engagement has not led to a change in behaviour
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PNO Media publishes and regularly updates a list of the excluded companies on its website (www.pnomediaverantwoordbeleggen.nl). At this point in time, producers of landmines, cluster bombs and ammunition,
nuclear, chemical, and biological weapons, as well as those involved in the production and trade of fur are
excluded. There are no countries on the exclusion list.
Score: 5 points
PNO Media has an exclusion policy that is publicly available, has clearly defined environmental and
social issues. It also publishes and updates a list of excluded companies.
The Pensioenfonds PNO Media has signed the UN PRI initiative. Due to the fact that PNO Media uses asset
managers located within and outside of the Netherlands it has found a specialised external partner that
screens all the investments and works to further integrate ESG-criteria in the investment process.
One of its asset managers, FDA, is responsible for around 25% of PNO Media’s assets under management (40%
of all equity holdings) and uses sustainability analyses in its portfolio selection. It does this by distinguishing
between three aspects: economic, social and sustainability. The ratings are quantified and reported on
throughout the year. ESG-criteria are part of the selection process for all new asset managers. Managers must
consider ESG-criteria and commit to PNO Media’s fundamental principles.
Score: 4 points
PNO Media has applied ESG-criteria to the selection of a separate fund and has a publicly available
document containing clearly defined ESG-criteria.
4.19.4 Engagement
The Pensioenfonds PNO Media has an engagement policy in which it goes into dialogue with governments and
companies that have activities in clear violation of its fundamental principles. The implementation of its
engagement policy is done by EOS. If engagement activities are not successful, PNO Media may vote against
the Board of the company, and can ultimately be placed on the exclusion list.
PNO Media reports on its engagement activities on its website and consciously does not publish the names of
the companies with which it is engaging in order to protect the success of the engagement activities.
Score: 5 points
PNO Media a clear engagement policy based on carefully chosen social and environmental issues, and
links this to its exclusion policy. The pension fund also reports on its engagement activities.
PNO Media has a voting policy that is based on its fundamental principles, financial interests and the Hermes
Principles. PNO Media makes use of Hermes EOS to implement its voting policy and protect is interests as shareholder. A complete voting record is available and updated regularly on its website. Making use of Hermes,
PNO Media is able to introduce important ESG and corporate governance shareholder resolutions at general
meetings.
Score: 4 points
PNO Media introduces and votes actively on shareholder resolutions and supports other resolutions on
the topic of sustainability. It also publishes its voting record.
Currently, the Pensioenfonds PNO Media does not invest in sustainable projects. It has completed an investigation in 2009 into the possibilities offered by investing a part of its assets in sustainable projects. This means
that PNO Media is well into the process of selecting a manager for its microfinance portfolio and is finalizing
a commitment in an infrastructure fund focusing primarily on clean tech. It has also initiated a selection pro-
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cess for a manager that is specialised in an SRI investment mandate.
Score: 1 point point
PNO Media currently has no sustainable project financing activities at this time, but is working on it.
PNO Media provides complete transparency in its use of asset managers for all asset classes. This is done in
its annual report. It also has a policy for how its asset managers adhere to its responsible investment policy
and is working on selecting asset managers based on sustainability criteria. ESG-criteria are part of the selection process for all new asset managers.
Score: 5 points
PNO Media provides a complete list of its asset managers and states how these asset managers adhere to
its responsible investment portfolio. It also selects external parties based on sustainability criteria.
The Pensioenfonds PNO Media engages in active dialogue with its participants. Due to the fact that its participants are journalists and opinion makers, it is very important for PNO Media to communicate with them in
an effective manner. The members are given the opportunity to respond through the website and are able to
comment on the ESG policy. PNO Media participates in a group of pension and institutional investors with the
goal of sharing knowledge and ideas on ESG. The responsible investment portfolio is defined by its participant
advisory board (deelnemersraad) and the Board. It has also asked for input from a consultancy into its responsible investment portfolio and frequently consults with opinion leaders on the topic of ESG to see what
the latest developments are and how its can respond to these developments.
Score: 5 points
PNO Media consults its members and other members of society. This has a demonstrable impact on its
responsible investment portfolio.
The Pensionfonds PNO Media reports extensively on its responsible investment policy and implementation.
This is done using a dedicated website (www.pnomediaverantwoordbeleggen.nl), an annual report on its responsible investment activities and a regular website and annual report.
All these sources contain information on the instruments PNO Media uses to implement its responsible investment portfolio, what asset managers are used, and also report on its engagement and voting activities. A complete list of all its holdings per asset class can also be found on the dedicated website.
Score: 5 points
PNO Media publishes a detailed overview of its investments within multiple investment categories and
report on the applied instruments and results.
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4.20 Pensioenfonds Productschappen
The industry-wide Pensioenfonds Productschappen (PFP) was founded in 1948 for employees of the marketing
boards for commodities, including Akkerbouw (Agriculture), Diervoeder (Animal Feed), Dranken (Beverages),
Granen, Zaden en Peulvruchten (Grain, Seeds and Pulses), Margarine, Vetten en Oliën (Margarine, Fats and
Oils), Tuinbouw (Horticulture), Vee, Vlees en Eieren (Lifestock, Meat and Eggs), Vis (Fish), Wijn (Wine) en
Zuivel (Dairy).
Description
Premium income
 12 million (bruto)
Active
Passive
Pensioners
931
983
1 130
Number of employees
-
 378,9 million
Equity
29.9 %
Fixed income
52.1 %
Derivatives
2.1 %
Real estate
7.6 %
Other
7.6 %
As institutional investor, the fund recognizes its social responsibility towards society. The website furthers
describe that: “Companies or governments may act in a manner not in accordance with the norms and values the society finds important. The impact of the fund’s investments on companies or governments is obviously very limited, because the amount of the investments of the fund in the total financing of individual
enterprises and governments in general is little. However, PFP wishes to implement a responsible investment
policy and is willing to held accountable for the social impact of its investment decisions.” Therefore the fund
is developing a policy its asset managers should commit to. More information on this responsible investment
policy will provided in the near future.
Score: 1 point
No publicly available responsible investment policy.
Score: 0 points
Score: 0 points
4.20.4 Engagement
Score: 0 points
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Score: 0 points
Score: 0 points
The fund has outsourced it administration to PBO-Dienstverlening and recently assigned MnService as its fiduciary asset manager. Mn Services acts as a strategic advisor for the balance and investment policy and is also
responsible for implementing the asset management of the Pensioenfonds Productschappen.
Score: 1 point
Score: 0 points
Score: 0 points
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4.21 Pensioenfonds voor de Grafische Bedrijven
The Stichting Pensioenfonds voor de Grafische Bedrijven (PGB) provides pension fund services for employees
within the printing and publishing sector in the Netherlands.
Description
Premium income
-
Active
Non-contributing
Pensioners
Number of employees
2 650
 8 378
45 000
191 150
37 500
Equity
 2 852
34 %
Fixed interest
 3 770
45 %
Real estate
 846
10 %
Derivatives
 553
7%
Other
 357
4%
PGB has a responsible investment policy that incorporates a number of different social, environmental and
governance criteria. These criteria are based on international rules and regulations as well as principles such
as the UN Global Compact. This policy is implemented using a number of different instruments that are summarized in its annual report.
PGB also makes a point of communicating its policy via its website, annual reports, magazines and online
newsletters.
Score: 4 points
PGB has a clear responsible investment policy that is based on international principles and regulations
that makes use of a number of instruments. This policy applies to a number of asset classes like real
estate and bonds beyond equity.
4.21.2 Exclusions
PGB has an exclusion policy that excludes companies that violate international regulations. These regulations concern human rights, working conditions, environmental issues and corruption as well as controversial weapons.
Research provider Sustainalytics provides a quarterly black list of companies that PGB’s asset managers must
adhere to. This policy was introduced in the last quarter of 2008.
Score: 4 points
PGB has a publicly available exclusion policy concerning various social and environmental issues.
PGB screens its equity, real estate and bond portfolio every quarter on the basis of ESG-criteria. In addition
to this, it has entrusted 60 million to the asset manager Threadneedle that uses a best-in-class approach
when making investment decisions.
Score: 3 points
ESG criteria are applied to the selection of investments within specially developed funds with a
best-in-class approach.
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4.21.4 Engagement
PGB is a member of the Governance Platform and engages with Dutch publicly listed companies together with
other pension funds. This led to engagement activities with nine companies in the Netherlands. If engagement is
not successful, a legal procedure can be started. PGB has participated in a number of class actions in the USA.
Score: 2 points
Engagement is limited to corporate governance and has not yet been expanded to ESG issues.
PGB does have a voting policy, but it is not publicly available. Its voting activities in the Netherlands was limited to fifteen companies in 2008, and voted at 541 European general meetings through the service provider
RiskMetrics/ISS.
Score: 3 points
PGB does have a voting policy, but it not clear if environmental and social criteria are used. It does
publish its voting activities.
PGB has added a responsible investment vehicle (also called ‘green investments’) to its portfolio. According
to its 2008 annual report, the size is approximately 319 million. This portfolio invests in infrastructure, clean
commodities (wood), clean energy (wind and solar energy) and microfinance.
Score: 4 points
PGB has a clearly defined sustainable project financing policy and invests more than 2% of its
investments in this portfolio.
PGB contracts approximately 90% of its asset management out to external managers. It is unclear who this
asset managers are and how they must adhere to PGB’s invest policy.
Score: 1 point
PGB provides some clarity into its asset management.
PGB monitors the opinions of its participants, pensioners and companies concerning its responsible investment
policy. This is done on a yearly basis.
Score: 3 points
PGB seeks a dialogue with its participants/policy holders concerning responsible investment.
PGB reports on its responsible investment policy and the instruments that it uses to apply this policy.
Score: 2 points
PGB reports on its policy and a number of instruments.
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4.22 Pensioenfonds voor de Metalektro
Pensioenfonds voor de Metalektro (PME) takes care of the pension arrangements of companies in the metal
industry. PME has its asset management activities outsourced to Mn Services.
Description
Premium income
 1,1 bilion
Active
157 395
Passive
334 282
Pensioners
144 694
Number of employees
0
 18,6 billion
Equity
38 %
Corporate bonds
20 %
Government bonds (vastrentende
waarden hoogrenderend)
Loans
Real estate
Participations
18 %
10 %
-
Other commodities
5%
Special projects
5%
Hedge funds
2%
Infrastructure
2%
Private equity
1%
PME has formulated a social responsible investment policy that covers equity, fixed income assets, real estate and alternative investments (including hedge funds and private equity). PME is a signatory to the UN
Principles for Responsible Investment (UN PRI). PME’s responsible investment policy is based on international
guidelines "such as the Universal Declaration of Human Rights, the ILO Core Conventions and other conventions developed by the UN and OECD”. These are the guiding principles for responsible investment that form
the basis for all activity in this field. The fund’s policy explains which guideline is used for which issue. The
policy is publicly available on the fund’s website.
Implementation of the policy uses the following instruments:
•
Integration of ESG-criteria in all asset classes
•
Exclusion
•
Voting
•
Engagement & dialogue with companies
•
Transparancy
•
Class actions and other compensation schemes
•
Mandating PME’s asset manager Mn Services via an annual plan.
Score: 5 points
The fund has a fully comprehensive policy, based on international principles and directives and is
publicly available on the fund’s website.
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In its exclusion policy, PME makes a distinction between violations of guiding principles that are inherent to
the product of a company, and violations that take place in the production process. Violations regarding the
product will lead to exclusion and applied in 2008 to controversial weapons, such as cluster munitions and
anti-personnel mines.
During 2009, the exclusion policy is being expanded to companies that are directly involved in the manufacturing of products that violate international treaties signed by the Dutch government. Violations in the production process can also lead to “desinvestment”, but before excluding the company, PME will first engage
this company in a dialogue in order to end the violation. The pension fund expects that this type of exclusion will comprise about 150 companies in 2009.
To avoid a conflict of interest, PME does in principle not invest in companies in the Dutch metal sector that
are quoted on the Dutch/European stock exchange.
Part of the responsible investment policy consists of a list of excluded companies (last update Augustus 31st
2009). This lists comprises 17 companies that are excluded because of the nature of their products, and 10
companies because they are part of the Dutch metalektro sector.
Score: 4 points
Exclusion based on one social criterion – controversial weapons (note: exclusion of Dutch metalektro
sector is based on governance).
In 2006, PME signed the UN PRI. PME is also participant in the Enhanced Analytics Initiative (currently part of
UN PRI) and uses two research providers that are specialised in ESG-issues. Their information is mainly used
for exclusion and engagement decisions. The fund states that “the way in which ESG-criteria are integrated
in the responsible investment policy differs between investment categories. Fund managers include ESG-criteria in the selection process of investments, also in the selection of hedge funds and real estate investments.” The ESG-criteria are secured in PME’s ‘guiding principles’ and match international treaties, UN Global
Compact and the OECD-code for multinational enterprises.
Score: 2 points
Signatory of UN PRI. ESG-criteria are used to scan the investment portfolio, but not for positive
selection.
4.22.4 Engagement
The ‘guiding principles’ are leading for the engagement dialogue that is undertaken by Mn Services and subcontractors (a.o. F&C Investments) on behalf of PME. Reports are published on a quarterly bases on PME’s
website. The engagement policy is focused on enterprises that violate PME’s ‘guiding principles’ (as far as
these are not excluded). PME uses a policy for engagement-led divestment. Besides, PME undertakes engagement activities with a limited number of enterprises that are quoted on the Dutch stock exchange and several enterprises in which the fund has a strategic interest.
Score: 5 points
Engagement policy based on clear principles, in multiple investment categories, and well-reported in
quarterly engagement reports available on the fund’s website.
In principle, PME votes at all shareholder meetings worldwide, following a voting policy that is based on the
fund’s ‘guiding principles’. Compliance with the ILO core conventions (concerning labour conditions, employees rights, child labour and forced labour) and treaties concerning health and safety of employees, are weig-
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hed heavily in the voting policy. Special weight is also granted to responsibility of companies to realise compliance with the fund’s ‘guiding principles’ (including ILO-conventions) with subcontractors and other partners in the product chain. The voting policy has further been developed and described in detail with respect
to certain issues such as ‘labour conditions‘ and ‘remuneration’.
PME has participated in proposing shareholder resolutions in cooperation with service provider F&C. In 2008,
PME brought in a resolution at Wal-Mart via its asset manager. As per April 2008, Mn Services carries out the
PME voting policy via Riskmetrics/ISS on behalf of PME.
Score: 5 points
PME has an extensive voting policy explicitly including ESG-criteria. Detailed voting reports are
available on the fund’s website.
PME does invest in initiatives that fall within sustainability financing, but doesn’t consider these investments
as a separate investment category. Hence, the investments are part of the existing portfolios. The fund further expresses that it wishes to expand these investments.
In 2007, more than  400 million was invested in forestry plots in the US. Contractual agreements have been
made with the managers of these plots, to aim towards sustainable forest management. This was agreed in
the covenant that PME and FSC Nederland signed in 2007. The amount invested in the American forestry sector amounts to 1,8% of the fund’s total value invested.
Additionally, the Private Equity portfolio comprises private equity investments in clean-tech en renewable
energy.
Score: 3 points
PME invests more than 1% of its total portfolio in sustainable projects, and provides public
information on size of the investment and the projects.
PME has outsourced all its asset management activities to Mn Services. Mn Services, as PME’s fiduciary manager, carries out all asset management according to the policy guidelines developed by PME. Mn Services takes
its own responsibility in selecting other investors (external managers, hedge funds), granting these parties
mandates and taking care of their policy execution. A list of underlying managers is not published but known
with the fund’s governing bodies.
Score: 3 points
Transparency about asset management and agreements on responsible investment approach.
After the Zembla documentary in 2007, PME invited the participants council for a dialogue, and an inquiry
was undertaken amongst participants. Moreover, PME pays attention to responsible investment on the fund’s
website and in PME-Magazine, during meetings organised for pensioners and on meetings for employers. The
fund has signed a covenant with FSC Nederland regarding certification of a.o. American forestry investments.
Score: 3 points
Dialogue with both participants and other (albeit only few) representatives from society.
On its website, PME publishes complete overviews of the companies in which the fund holds equity, of the
fund’s voting behaviour, and its engagement programme. The fund also reports about the responsible investment policy and its guiding principles, its responsible investment results in the annual report, it reports on
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UN PRI, on active shareholdership and the covenant with FSC and transparency objectives. The responsible
investment policy is available on the website, including exclusion list and the activities planned for the upcoming year, such as upcoming engagement activities.
Score: 4 points
Reporting on all applied instruments and results and publication of total equity portfolio.
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4.23 Pensioenfonds voor de Woningcorporaties (SPW)
The Stichting Pensioenfonds voor de Woningcorporaties (SPW) provides pension fund services for the housing
corporations sector.
Description
Premium income
 262
Active
34 741
Non-contributing
16 573
Pensioners
12 504
Number of employees
-
 3 767
Equity
 1 130
30 %
Fixed interest
 1 394
37 %
Real estate
 414
11 %
Derivatives
 452
12 %
Other
 377
10 %
According to its 2008 Annual Report, SPW has a responsible investment policy that is based on the UN PRI. A
number of instruments are described for the implementation of this policy. Last year’s edition of this benchmark described the policy as being based on a number of international principles and directives, but the policy
is still not publicly available. This policy applies to all investment categories.
Score: 3 points
SPW does have a clear responsible investment policy, but it is not publicly available.
4.23.2 Exclusions
SPW has an exclusion policy that aims to avoid investments that violate international rules and regulations.
Investments having to do with immoral conduct as well as those that are related to violations of human rights
and freedoms are also avoided.
This means that companies are excluded that are involved in the manufacture of cluster bombs, landmines,
as well as companies that tolerate forced child labour or are active in Burma or Colombia (unless human rights
are seen as having an important place in the company’s policy and/or the violation of human rights is avoided in the activities of the company).
Score: 4 points
SPW has a publicly available exclusion policy concerning various social issues, but does not have
a publicly available list of excluded companies and/or countries.
SPW follows the UN PRI and thus tries to take ESG criteria into account in its investment criteria. This is done
in the equity portfolio, but it is looking to expand on this using themed investments (eg. Clean Tech).
Score: 2 points
SPW has a general statement that it supports the UN PRI and works to integrate ESG into its
portfolio selection.
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4.23.4 Engagement
SPW has an engagement policy based upon Corporate Governance issues and takes part in the Governance
Platform. This means that it addresses companies on their corporate governance policy.
Score: 3 points
SPW does have an engagement policy, and is clear about the priorities upon which it is based
(Corporate Governance). There is, however, no reporting on these activities.
SPW has delegated its voting activities to Cordares Vermogensbeheer. A document describing the voting policy is available upon request. Cordares Vermogensbeheer makes use of RiskMetrics to implement its voting
policy and reports on its voting activities.
Score: 2 points
SPW has an active voting policy that includes clear environmental and social criteria. Its voting
activities do not seem to be publicly available.
SPW has a 5 million investment in microfinance and is planning to invest in the Clean Tech sector.
Score: 2 points
SPW has a sustainable project-financing portfolio that makes up less than 1% of its invested capital.
SPW has outsourced its entire asset management to Cordares Vermogensbeheer, including its responsible
investment activities.
Score: 3 points
SPW provides a full list of its asset managers and provides insight into how the asset manager
complies with and carries out its responsible investment policy.
SPW’s investment strategy is discussed within its participant council (deelnemersraad). This council advises
the board on its policies including its responsible investment policy.
Score: 3 points
SPW has seeks a dialogue with its participants about its responsible investment policy.
SPW reports on its responsible investment policy and implementation on its website and annual report.
Cordares Vermogensbeheer, its asset manager, reports every quarter on its Corporate Governance activities.
Score: 2 points
SPW reports on its responsible investment policy but a list of the companies in which it invests
cannot be found.
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4.24 Pensioenfonds Werk en (re)Integratie (PWRI)
The Pensioenfonds Werk en (re)Integratie (PWRI) provides pension fund services for the social employment
opportunity sector.
Description
Premium income
300,6
active
105 677
non-contributing
102 904
Pensioners
41 948
Number of employees
-
 3 451
Equity
 839
24 %
Fixed-interest
 2 069
60 %
Derivatives
1
Real estate
 401
12 %
Other
 141
4%
0%
PWRI has integrated responsible investment into its investment policy since 2004. This policy considers legal
requirements and societal developments set in initiatives such as the Code Tabaksblat. PWRI has also signed
the UN PRI. Its policy is based on:
-
exclusion
-
engagement
-
voting
In implementing its responsible investment policy, PWRI wants to make use of its voting rights as well as its
engagement opportunities. It has also defined a number of environmental, social and governance (ESG) criteria that must be considered in the investment process. PWRI excludes companies involved in the manufacture of cluster bombs and land mines in the equity, credit, and bond asset classes. For engagement, PWRI’s
asset manager determines the priorities and topics on an annual basis.
Score: 3 points
PWRI has a publicly available responsible investment policy with deliberately chosen social and
environmental issues that clarifies the use of instruments. It is not based on clear international
principles and directives.
4.24.2 Exclusions
PWRI excludes companies involved in the production of cluster bombs and land mines. A list of excluded companies is available on demand. PRWI is currently part of a working group consisting of various pension funds
that is determining other possible exclusion criteria. It is also considering adding other asset classes to its
exclusion policy.
A list of excluded companies is available on request.
Score: 4 points
PWRI has a publicly available exclusion policy concerning one issue with a list of excluded companies.
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4.24.3 ESG-criteria for portfolio selection (positive selection)
PWRI works to integrate ESG criteria into its investment process. PWRI’s asset manager F&C has a team of ESG
researchers and is involved in a number of international working groups:
-
the International Corporate Governance Network (ICGN);
-
Eumedion;
-
the Corporate Leaders Group on Climate Change (CLGCC); and
-
a working group of the Global Reporting Initiative (GRI).
F&C also supports initiatives such as the Enhanced Analytics Initiative (EAI) and spends 5% of broker commission on external research.
Score: 3 points
PWRI has signed the UN PRI and ESG criteria are applied to investments one or more general
investment categories.
4.24.4 Engagement
PWRI has given its asset manager(s) the mandate to conduct engagement activities to encourage companies
in which it invests to improve their performance on ESG issues. All companies are engaged with at least once
a year, encouraging them to perform better on ESG issues. The engagement activities are more intensive with
companies that have larger risks or opportunities in this area.
A priority list of companies is put together every year (or more) with which active engagement is sought based
on a combination of macro-economic risks and other factors such as input from asset owners.
Score: 4 points
PWRI has an engagement policy based on deliberately chosen environmental and social criteria and
regularly engages with companies through its asset manager. It also reports on its engagement activities.
PWRI votes at general meetings through its asset manager F&C. Its voting policy is based on corporate governance aspects (Code Tabaksblat) and other criteria. The goal of the voting policy is to increase shareholder
value through increased transparency and holding management accountable. PWRI reviews its voting activities based on the reporting that its asset manager F&C does. Reporting is done on a quarterly as well as annual basis.
Score: 4 points
PWRI has a voting policy based on ESG aspects and reports on it.
PWRI currently does not invest in sustainable projects.
Score: 1 point
The pension fund has no sustainable project financing.
PWRI’s asset managers are F&C as well as Syntrus Achmea Vastgoed. Its responsible investment policy is implemented by F&C.
Score: 3 points
PWRI is provides clarity into its outsourcing and formalizes external party commitment to its
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PWRI regularly communicates its responsible investment policy and activities to its participants, the board
and the investment committee.
Score: 3 points
PWRI seeks a dialogue with its participants concerning its responsible investment policy.
PWRI reports on its responsible investment policy in its annual report as well as on its website. A quarterly
report of its asset manager summarizes its activities.
A list of excluded companies is available on request. Due to the fact that PWRI invests in pooled funds, it is
unable to report more accurately on its specific investments.
Score: 3 points
PWRI reports on its responsible investment policy and reports on all applied instruments, but only
provides a detailed overview of investments on request.
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4.25 Pensioenfonds Wonen
The Stichting Pensioenfonds Wonen provides pension fund services for (ex) employees in the housing sector.
Description
Premium income
 85 million
Active participants
32 700
Non-contributing
81 337
Pensioners
9 996
Number of employees
 1.4 billion
Equity
 172
12 %
Fixed-interest
 846
61 %
Derivatives
 191
14 %
Real estate
 155
11 %
Other

42
3%
Negative derivatives
 - 21
-2%
Stichting Pensioenfonds Wonen has a responsible investment policy that uses the principles of the UN Global
Compact as starting point. These principles, in turn, are based on international guidelines such as the
Universal Declaration of Human Rights and the ILO Conventions. The implementation of the policy consists of
-
the following elements:
-
exclusion of controversial weapons
-
engagement
-
voting policy for corporate governance
Score: 3 points
Pensioenfonds Wonen has a publicly available responsible investment policy covering environmental
and social issues that is based on a number of international guidelines and directives. The use of
instruments is clarified but it seems only to apply to the equity portfolio.
4.25.2 Exclusions
Pensioenfonds Wonen has an exclusion policy with respect to controversial weapons. The pension fund considers weapons controversial when they cause a disproportionate number of casualties, when they do not make
a distinction between military and civilian targets, and when these weapons cause harm after the conflict has
been terminated. Controversial weapons, such as cluster munitions, have a negative long term impact on both
the economic and social development of a post conflict area. The exclusion of these types of weapons fits
within the framework of the pension funds’ social responsible investment policy.
-
Nuclear weapons;
-
Biological weapons;
-
Chemical weapons;
-
-
Cluster munitions.
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A formal policy document with more background information and a list of companies that were excluded
during 2008 can be found on the website.
Pensioenfonds Wonen currently only excludes producers of controversial weapons.
Score: 4 points
Pensioenfonds Wonen currently has a publicly available exclusion policy around one issue:
controversial weapons. The fund also publishes a list of excluded companies.
Pensioenfonds Wonen will include Environmental, Social and Governance information into its mainstream
investment processes in order to improve the risk return profile of the portfolio. This is a result of
Pensioenfonds Wonen’s belief that ESG information is often not explicitly valued in financial data, while it can
have financial consequences. To this end, Pensioenfonds Wonen makes use of research from external (ESG)
data providers, academic research as well as in-house research.
Score: 2 points
Pensioenfonds Wonen states that it incorporates ESG-criteria into its investment strategy.
4.25.4 Engagement
Pensioenfonds Wonen has an engagement policy that is described in its annual report. Its aim is to incite the
companies in its portfolio to improve its behaviour and create shareholder value. In 2008, Pensioenfonds
Wonen centred its engagement around several themes: forced labour and human rights, environment, corruption and controversial regimes for companies involved in the energy and commodities sector. Its engagement activities are published on its website.
Score: 4 points
Pensioenfonds Wonen has an engagement policy that takes deliberately chosen social and
environmental issues into account and regularly engages with companies. It also reports on these
activities.
Pensioenfonds Wonen has adopted a voting policy to govern the exercise of voting rights for all of its direct
equity investments.
Pensioenfonds Wonen also pays special attention to shareholders resolutions that are related to environmental and social issues, and to shareholder meetings of companies that are included in the engagement program.
The pension fund makes use of a specialist research provider, the RiskMetrics Group, that provides information concerning upcoming shareholder meetings of companies in its equity portfolios. Due to the international character of the pension fund’s equity portfolio, it is not possible to attend all general meetings. The pension fund exercises its voting rights by proxy voting, that are facilitated by the RiskMetrics Group as well.
Score: 4 points
Pensioenfonds Wonen has an active voting policy and is clear about the sustainability criteria upon
which it is based. Its voting activities are also publicly available.
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Pensioenfonds Wonen has allocated a part of its assets to private equity. The pension fund participates in the
- Exclusion of sectors (production of pornographic material, tobacco, fur, and the production and/
or distribution of weaponry.
- The importance of the 10 UN Global Compact principles when negotiating with fund managers.
Pensioenfonds Wonen has a sustainable project-financing portfolio, but it is unclear what the value of these
investments is.
Score: 2 points
Pensioenfonds Wonen has outsourced its asset management to Syntrus Achmea Asset Management. Syntrus
Achmea Asset Management is committed to implementing the responsible investment approach and reports
to the pension fund on a semi-annual basis.
Score: 3 points
Pensioenfonds Wonen provides clarity into its asset managers and provides insight into how the asset
Pensioenfonds Wonen has a participants’ council (deelnemersraad) that meets with the board.
Score: 2 points
Pensioenfonds Wonen seeks a dialogue with its participants.
Pensioenfonds Wonen reports on its responsible investment policy and activities in its annual report and on
its website.
Score: 3 points
Pensioenfonds Wonen reports on its responsible investment activities and publicizes a list of its
equity holdings through its voting records.
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4.26 Pensioenfonds Zorg en Welzijn (PFZW)
Pensioenfonds Zorg en Welzijn (PFZW) provides pension fund services for (former)employees in the care and
welfare sector in the Netherlands.
Description
Premium income
 4 086
Active
1 100 000
Non-contributing
737 000
Pensioners
277 000
Number of employees
-
 71 000
(31-12-2008)
Equity
32 %
Bonds
32 %
Derivatives
-
Real estate
14 %
Alternatives (commodities, private equity,
structured credit, infrastructure, portfolio
of strategies
19 %
Cash
3%
PFZW has a publicly available responsible investment policy that has been detemined by the fund, with the
support of PGGM, its asset manager. This has been the case for a number of years. This policy deals with a
variety of ESG themes, but focuses particularly on the topics of controversial weapons, human rights, health
and medicine, corporate governance, and climate change and is based on international principles like the UN
PRI and the OECD guidelines for multinational enterprises. PGGM’s policy is meant to create added value by
keeping the following points in mind:
-
achieve a high, stable and responsible return for its clients
-
maintain strict control over the investment portfolio and the controlling of risks
-
achieve extra return through innovative investment strategies
This policy covers all investment categories.
Score: 5 points
PFZW has a clear responsible investment policy covering a range of deliberately chosen environmental and
social themes. The policy is based on international principles, clarifies the use of instruments and covers
all investment categories.
4.26.2 Exclusions
PFZW has an exclusion policy with three categories. Companies are excluded if they:
-
Are involved in the production and/or sale of (essential parts of) controversial weapons
-
Are involved in the violation of fundamental human rights (as described by the UN and the ILO)
Do not change their behaviour after an ESG engagement process has not led to improvement (for instance on
environmental issues)
The exclusion policy also includes government bonds since 2008. PFZW publishes a list of excluded companies
and countries on its website. This list of 30 companies contains 29 companies involved in controversial weapons and one company that was excluded after an unsuccessful ESG engagement process around human rights
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violations. A total of 5 countries are excluded. These exclusions are based on ILO statements and UN sanctions. A country can also be excluded if these countries violate the values of PFZW and do not show any intention to change.
Score: 5 points
PFZW has a clear exclusion policy based on a range of environmental and social criteria. It also
publishes a list of excluded companies and countries.
PGGM Vermogensbeheer, the asset manager for PFZW, also has an ESG policy. ESG-criteria are used to analyse the behaviour of companies in which PFZW invests. PFZW has signed the UN PRI and PGGM
Vermogensbeheer is a signatory investor of the Carbon Disclosure Project (CDP). This ESG analysis also applies
to the investment process in other asset classes such as real estate and private equity.
PFZW has given PGGM a mandate to construct a Responsible Equity Portfolio, where responsible companies
are selected based on positive selection.
Score: 5 points
ESG-criteria are applied to the selection of investments within specially developed funds using
positive selection. PFZW also has a publicly available document containing clearly defined
ESG criteria applied to investments and carries out concrete activities.
4.26.4 Engagement
PFZW has chosen four themes for its engagement policy: corporate governance, human rights, climate change, and health. Its engagement activities are carried out by PGGM, which outsources these activities partially to F&C. A report that summarizes all engagement and voting activities is available on the website. This
report also contains the names of companies that were engaged with.
Score: 5 points
PFZW has a deliberately chosen engagement policy and regularly engages with companies. It also
reports on its activities and links this to its exclusion policy.
PFZW has a voting policy that contains a range of ESG issues. It also reports on its voting activities in its PGGM
Kwartaalverslagen Actief Aandeelhouderschap report. In this report companies and issues are clearly reported on. It is also possible to view the proxy voting activities for PFZW on the PGGM website.
PFZW voted at 92% of the Annual General Meetings in which it was entitled to vote. This was done by attending the meetings, sending representatives or using voting platforms. PFZW pays special attention to shareholder resolutions concerning ESG issues and decides on an individual basis whether to support it or not.
Score: 4 points
PFZW pays attention to shareholder resolutions, has an ESG voting policy and reports on its activities.
PFZW invests a significant amount in sustainable project financing. In 2008 the invested amount increased
form 1,7 to 2,4 billion. PFZW is planning to increase this amount in 2009.
Score: 4 points
PFZW invests in excess of 1 billion in sustainable project financing, but does not provide information
on projects.
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PFZW has completely outsourced its asset management to PGGM. PGGM is subject to PFZW’s responsible
investment policy. In broad terms, it involves the following activities:
• Responsible investment decisions
• Committed investment
• Exclusions of companies and government bonds
•
Stimulating innovation
PFZW also outsources part of the asset management out to external parties. These parties, along with the
invested capital, are published on PFZW’s website and are also judged based on ESG criteria. These criteria
will play an increasingly important role in the selection of new parties. The methodology for this process is
described on PGGM’s website as well as its annual report on responsible investment activities in 2008
(Jaarverslag Verantwoord Beleggen 2008).
Score: 3 points
PFZW is clear about its outsourcing and provides an overview of external parties. It does not,
however, formalize external party commitment to its responsible investment policy.
PFZW has an active dialogue with its members within its participants’ council (deelnemersraad). This dialogue can be continued with the fund as well as the asset manager at its client days. PFZW also seeks a dialogue with societal organisations. This led, for example, to the selection of the themes to be focused on in its
Score: 5 points
PFZW reports on its responsible investment policy and activities in the annual responsible investment report
of its asset manager (PGGM Verslag Verantwoord Beleggen). Its activities are further reported on in its quarterly report. PFZW’s website also contains information on the investments in funds, equity, publicly traded
bonds and private equity.
Score: 5 points
PFZW published a detailed overview of its holdings within multiple categories and also reports on the
applied instruments and results.
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4.27 Spoorwegpensioenfonds
Spoorwegpensioenfonds carries out the pension arrangements of all employees of the Dutch Railways (NS) and
related companies. The pension administration is outsourced to SPF Beheer.
Description
Premium income
 68 million
Active
30 252
Passive
16 918
Pensioners
24 865
Number of employees
0
 9.5 billion
Equity
30.5 %
Corporate bonds
12.4 %
Government bonds
25.1 %
Loans
Real estate
Participations
Other
6.3 %
15.3 %
5.5 %
- private equity
1.6 %
- opportunities portfolio
0.7 %
- commodities
2.5 %
- cash
-
On its website, Spoorwegpensioenfonds explains its policy regarding social responsible investment (SRI). The
policy is based on the UN Global Compact and UN PRI. Spoorwegpensioenfonds describes several themes which
are focus areas for the SRI policy, and describes instruments that (can) be deployed. The SRI policy covers the
equity portfolio and other investment categories, amongst which corporate and government bonds and private equity. The policy for real estate is currently being developed.
Score: 4 points
Publicly available responsible investment policy based clear principles and covering all but one
investment categories.
The Spoorwegpensioenfonds SRI policy states that the fund will not invest in certain companies, “based on
the principles of Global Compact and additional requirements in the areas of child labour, environment and
human rights”. The fund’s list of excluded companies that is publicly available lists only producers of controversial weapons.
Score: 4 points
Publicly available exclusion policy, but list of excluded companies is limited to one issue.
Spoorwegpensioenfonds has signed UN PRI, and expresses on its website to include ESG criteria in its guidelines for investment. It also has a strategically allocated asset portfolio that makes use of positive selection.
This accounts for approximately 10% of the equity class.
Score: 3 points
Signatory of UN PRI and general statement of considering ESG-criteria in investment selection, as well
as a specially developed fund that incorporates a best-in-class approach.
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4.27.4 Engagement
Spoorwegpensioenfonds has an engagement policy based on the principles of UN Global Compact. In the annual
report, several names are listed of companies that were part of the engagement programme in 2008. However,
the results of engagement are not reported upon. The engagement policy is linked to the exclusion policy.
Score: 4 points
Engagement based on UN Global Compact, with limited reporting on the extent and results of
engagement process. It is, however, linked to the exclusion policy.
Spoorwegpensioenfonds has a policy to vote actively on shareholder meetings (via SPF Beheer). The guidelines for voting on shareholder meetings (a.o. with respect to ESG-criteria) are not publicly available. The fund’s voting behaviour is being published online as of early 2008. From these reports it becomes clear that the
fund supported 73 out of 117 resolutions that were related to environmental and social issues.
Score: 3 points
Spoorwegpensioenfonds has no publicly available voting policy addressing ESG issues, but does
publicize presence and voting behaviour during shareholder’s meetings on its website.
Spoorwegpensioenfonds actively searches and develops possibilities to invest sustainably in a number of special funds. It has, for example, set up a fund that includes a project in Mali in cooperation with the Dutch
Koninklijk Instituut voor de Tropen (KIT). The total amount currently invested in sustainable projects and companies is around  20 milion, comprising two microfinance funds and a ‘green bond’. This is less than 1% of
the fund’s total investment portfolio.
Score: 2 points
No policy on sustainable project financing, but does provide information on project and size of
investment. Current investments in sustainable projects amounts to less than 1% of the total
The equity portfolio of Spoorwegpensioenfonds is managed by SPF Beheer, which in turn uses external asset
managers for its investments. The names of the external managers are published online every quarter, and
the external asset managers have to comply to the Ethiscal Code as stated by the Spoorwegpensioenfonds.
Score: 3 points
Spoorwegpensioenfonds is transparent about its external asset managers and the ethical code these
parties have to comply with.
Spoorwegpensioenfonds actively engages its participants in a dialogue, amongst others concerning responsible investment. The fund also offers various presentations and courses with space for interaction, in which
the topic of social responsible investment is being discussed. Additionally, the pension fund cooperates with
the KIT in a shared project in Mali.
Score: 4 points
Active engagement of participants and (albeit few) other representatives of society.
Each quarter, Spoorwegpensioenfonds publishes a list of all the companies the fund invests in on its website.
This lists covers both direct investments as via external asset managers. No insight is provided in other invest-
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ment categories. The fund reports on responsible investments and the instruments used on its website and in
the annual report.
Score: 4 points
Full disclosure of companies into equity investments, but no detailed insight in other investment
categories. It also reports on a number of implemented instruments.
Occupational pension funds
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4.28 Pensioenfonds Medisch Specialisten (SPMS)
Stichting Pensioenfonds Medisch Specialisten (SPMS) is an occupational pension fund. The fund is responsible
for implementing the collective pension scheme of medical specialists.
Description
Numbers (31 December 2008)
Premium income
 115 million
Active
6 981
Non-active
-
Pensioners
-
Number of employees
5
 4266 million
Equity
34 %
Bonds
39 %
Loans
-
Real estate
15 %
Participations
-
Other
12 %
SPMS has formulated a policy on SRI that applies to all investment categories. A description of this policy (in
Dutch) can be found on the website of SPMS and presents mainly the used instruments (exclusion, voting and
engagement). SPMS uses the services of F&C to execute the policy on SRI. The objectives, principles and criteria of the policy are unclear as well as the international norms and directives it is based upon.
SPMS adopts the criteria of United Nations Principles for Responsible Investment (UNPRI).
Score: 2 points
SPMS does clarify the use of instruments and covers multiple investment categories, but a policy
document with principles and criteria of the policy is not available.
SPMS uses ESG-criteria for exclusion of investments and does not invest in companies associated to landmines
or cluster bombs.
Both an explanation of the policy and a list of currently excluded companies are available on the website.
Score: 4 points
Publicly available and clearly defined exclusion policy concerning one issue and exclusion list on the
website.
SPMS uses ESG criteria for the selection of investments.
•
A description of this policy (in Dutch) is on the website of SPMS.
•
SPMS adopts the criteria of UNPRI.
•
SPMS uses the services of F&C to execute the policy on SRI.
Score: 2 points
SPMS applies the UN PRI and has a general statement that ESG criteria are included in investment
decisions.
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4.28.4 Engagement
SPMS does undertake engagement activities aiming to stimulate corporate social responsibility among the
companies in the investment portfolio by using the Responsible Engagement Overlay service (reo) of F&C
Investments. F&C uses its influence as a major asset manager to encourage better management of environmental, social and governance risks by companies on behalf its clients. The purpose of this active, systematic and constructive dialogue with corporations invested in is to encourage improvement of corporate governance, social commitment and environment policy. Of major importance for this dialogue are corporate governance, prevention of bribery and corruption, sustainability and labour. The engagement policy of SPMS has a
link to the exclusion policy. If engagement shows no result, a firm can be transferred to the exclusion list.
The report of F&C’s engagement activities is available on SPMS’ website.
Score: 5 points
and environmental issues and regularly engages companies in dialogue. The pension fund also reports
on its engagement activities.
SPMS will give substance to guidelines for corporate governance under the Code Tabaksblatt by its voting policy, executed by F&C Investments. On behalf of SPMS, F&C seeks to understand the circumstances of each company, encouraging companies to provide explanations if their policies deviate from good practice.
SPMS receives quarterly and annual reports to monitor the results of F&C's voting activities, also available on
SPMS’ website.
Score: 4 points
and is publicising presence and voting behaviour.
SPMS does not invest part of its portfolio to finance companies that have a very high sustainability relevance
sec for this reason.
Score: 1 point
SPMS outsources its asset management to Doctors Pension Fund Services (DPFS). DPFS acts as a fiduciary
manager and outsources all asset management to external asset managers (mandates).
All the activities (voting and engagement) in the field of responsible investment are outsourced to F&C
Investments.
Score: 2 points
The pension fund is clear about its outsourcing of responsible investment activities and its fiduciary
asset manager, but does not provide a comprehensive overview of its external asset managers
operating under DPFS, nor how they are committed to is responsible investment policy.
SPMS has an active dialogue with participants, especially with representatives and the board of the so-called
Beroeps Pensioenvereniging Medisch Specialisten (BPMS, a participants council).
On the subject of SRI we cooperate with the Stichting Pensioenfonds Huisartsen (SPH) and have a working
group that consists of participants of the board of trustees of both funds. This working group regularly invi-
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tes experts on the subject of SRI. The minutes of (all) meetings are available to participants at the private
part of the website of SPMS.
Finally SPMS signed the investment statement of the Access to Medicine Index (ATM).
Score: 2 points
The pension fund seeks dialogue with participants and other pension funds.
The annual report of SPMS provides information on the decisions taken with regard to responsible investment.
SPMS also provides voting and engagement reports of the first quarters of 2009 from F&C Investments and
asset managers voting on behalf of SPMS before 2009, on its website.
Score: 2 points
The pension fund only partially reports on applied instruments. Despite the information provided on
the instruments, the principles and criteria of its policy are not available on the website.
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4.29 Stichting Pensioenfonds voor Huisartsen
Stichting Pensioenfonds voor Huisartsen (SPH) was set up in 1973 as a compulsory collective occupational pension scheme for doctors.
Description
Premium income
 145 million
14.781
Number of employees
0
 6.500 million
Equity
42.5 %
Corporate bonds
10.0 %
Government bonds
15.0 %
Loans
-
Real estate
12.5 %
Participations
-
Other
20.0 %
A social responsible investment policy has been formulated by the Board of Directors of SPH in the past that
applies to equity and real estate. A description of this policy (in Dutch) can be found on the website of SPH
and presents mainly the used instruments (exclusion, voting and engagement). The objectives, principles and
criteria of the policy are unclear as well as the international norms and directives it is based upon.
F&C Investments has been appointed as the service provider regarding the execution of the policy of SPH from
January 2009. They take care of the implementation of the policy on the areas of engagement, proxy voting
(corporate governance) and social governance.
SPH acts according to the Principles for Responsible Investment (UNPRI) and the agreed policy which has been
implemented by F&C. SPH will evaluate its Responsible Investment Policy on a yearly basis and adjust this if
necessary.
Score: 2 points
SPH does clarify the use of instruments and covers multiple investment categories, but a policy
document with principles and criteria of the policy is not available.
SPH excludes investments in companies active in the production of landmines and cluster bombs. SPH has a
list of excluded companies. The list contains companies which core activities are the production of weapons
and/or landmines:
•
Alliant Techsystems
•
General Dynamics
•
L3 Communcations
•
Lockheed Martin
•
Northrop
•
Raytheon
•
Singapore Technologies Engineering
•
Textron
•
Thales
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This list is available on the SPH-website.
Score: 4 points
The pension fund does use a list with excluded companies, and has a public policy document.
SPH does not include ESG-criteria in their investment decisions. The investments have been outsourced to
external asset managers. Their investment decisions are based upon, amongst others, the undervaluation of
the stock of a company, the focus of the management and the sustainability and quality of the business model.
The ESG-criteria have been included implicitly in those decisions.
Score: 1 points
No ESG-criteria included in selection of investments
4.29.4 Engagement
Since January 2009 F&C Investments executes engagement activities for SPH. Through the Responsible
Engagement Overlay service (reo), F&C uses its influence as a major asset manager to encourage better management of environmental, social and governance risks by companies on behalf its clients. This is done by
voting actively on all holdings and through dialogue. The purpose of this active, systematic and constructive
dialogue with corporations invested in is to encourage improvement of corporate governance, social commitment and environment policy. Of major importance for this dialogue are corporate governance, prevention of
bribery and corruption, sustainability and labour. The engagement policy of SPH has a link to the exclusion
policy. If engagement shows no result, a firm can be transferred to the exclusion list.
Furthermore, SPH supports the Access to Medicine index by signing the Investor Statement. This index measures and assesses the efforts of the pharmaceutical companies (on an individual level) to give people access
to medicines on a global basis. For the Access to Medicine Index to work, it is paramount that large investors
see value in ranking pharmaceutical companies’ efforts to improve global access to medicines.
Score: 5 points
The pension fund does systematically engage with companies in dialogue and the policy is linked to the
exclusion policy. It also reports on its engagement activities.
SPH has assigned F&C as of the early part of 2009 for the implementation and execution of its voting policy.
On behalf of SPH, F&C seeks to understand the circumstances of each company, encouraging companies to
provide explanations if their policies deviate from good practice. F&C also engages companies both before
the vote, to explain the expected standards and afterwards, to explain the reasons for any votes against
management.
SPH receives quarterly and annual reports to monitor the results of F&C's voting activities. On a quarterly basis
shareholder resolutions filed by F&C on behalf of SPH are published in a confidential report received by SPH. In
general shareholder resolutions are reported each year in a publicly available Responsible Investment report.
Shareholder resolutions filed in 2009 on behalf of SPH will therefore be made public in the beginning of 2010. The
quarterly public voting reports of 2009 will become available on the SPH-website as soon as possible.
In 2008, the external asset managers voted on behalf of SPH.
Score: 4 points
and is publicising presence and voting behaviour.
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Within its Resposible Investment policy, SPH focuses on companies that distinguish themselves positively in
the field of socially responsible issues, such as companies that focus on developing clean technologies.
These are the following investments:
•
Robeco Clean Tech Private Equity II
•
Amsterdam City Recovery Fund.
Score: 2 points
The pension fund does invest in sustainable projects, but does not provide information on
investment size.
Both asset management and engagement activities have been outsourced by SPH. The asset management activities have been completely outsourced to external asset managers. F&C implements the policy as stated by
the Board of Directors of SPH on the areas of engagement, proxy voting and social governance.
SPH does not disclose the portfolio of their underlying asset managers. The selection of external asset managers is not done solely on the use of ESG-criteria. Those external parties have been assessed on a number of
criteria, amongst others alignment of interests, team, organization, investment process. Special attention has
been paid to the use of ESG-criteria in the investment process within the requests for information which have
been sent to external asset managers.
Score: 2 points
xternal asset managers, nor how they are committed to is responsible investment policy.
There has been an active dialogue with participants on the subject, through meetings and publications. An
example of such a dialogue are the meetings with the Vergadering van Afgevaardigden (Meeting of Delegates
from the participants association).
There is no report available describing the activities undertaken in this field and their results.
Score: 3 points
The pension fund occasionally seeks dialogue with participants and policy holders on the subject
of responsible investment.
The annual report of SPH provides information on the decisions taken with regard to responsible investment.
SPH also provides voting reports of the first quarters of 2009 from F&C Investments on its website.
Score: 2 points
The pension fund partially reports on applied instruments. Despite the information provided on the
instruments, SPH does not provide a detailed overview of companies in its investment portfolio.
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4.30 ABN AMRO Pension fund
The ABN AMRO pension fund is a corporate pension fund. It is an independent foundation that provides the
pension fund administration and payment for its past and current employees or relatives for the bank and/or
the affiliated organizations. These are:
• ABN AMRO Bank N.V.,
• BNY Mellon Asset Servicing B.V.,
• ABN AMRO Arbo Services B.V.,
• Fortis Investment Management (Netherlands) B.V.,
• Fortis Investment Management Holding N.V.,
• ABN AMRO Hypotheken Groep B.V.,
• Amstel Lease Maatschappij N.V.,
• Altajo B.V.,
• AAC Capital Holding B.V.
• Crédit Agricole Deveurope B.V.
Description
Premium income
 263
Active
24 117
Non-contributing
38 412
Pensioners
17 190
Number of employees
-
 8 900
Equities
-
Fixed income
-
Real Estate
-
Direct
-
Indirect
-
Alternatives
-
Liquidity
-
ABN AMRO pension fund has formulated and published a responsible investment policy based around the following definition: ‘Responsible investing is investing that takes financial, social, governance and environmental issues into account’. It feels that responsible investing is part of its fiduciary responsibility. This detailed policy is available on the website.
The responsible investment policy is based on a number of international principles and directives such as the
Ottawa and Oslo Conventions on controversial weapons, the ILO Declaration on Fundamental Principles and
Rights at Work and the Universal Declaration of Human Rights. It is implemented using a number of instruments such as exclusions, ESG integration and voting policies. The policy is implemented for equity and corporate bonds.
Score: 4 points
ABN AMRO has a (socially) responsible investment policy that provides insight into the international
standards upon which it is based and the instruments that are used. It is publicly available and covers
more than one asset class.
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4.30.2 Exclusions
The ABN AMRO pension fund has an exclusion policy in which it will not invest in companies that engage in
certain controversial behaviours and/or activities. ABN AMRO deems controversial those behaviours and activities that:
-
Are in conflict with (inter)national rules and regulations (signed by the Dutch government);
-
Are seen as controversial by broad societal agreement in the Netherlands.
This policy has been translated into three areas. The ABN AMRO pension fund will not invest in companies that
are involved in activities concerning:
-
Controversial weapons: cluster bombs, anti-personnel mines, chemical and biological weapons
-
Breach of fundamental workers’ rights
-
Breach of human rights
Score: 3 points
ABN AMRO has a publicly available and clearly defined exclusion policy. There is not a publicly
available list of excluded companies.
The ABN AMRO pension fund has begun integrating ESG-criteria in its the valuation analysis (waardenanalyse)
of its portfolio. Some of its asset managers pay attention to corporate governance aspects, while environmental and social aspects and their effect on long term performance are currently underexposed.
For this reason, ABN AMRO evaluates their asset managers based on a number of criteria related to ESG. These
criteria are all in the responsible investment policy found on its website.
Score: 2 points
ABN AMRO states that it incorporates ESG-criteria into its investment strategy.
4.30.4 Engagement
The ABN AMRO pension fund’s voting policy states that it makes use of proxy voting unless the pension fund’s
executive board wishes to engage in dialogue with a company. This engagement is limited to companies that
are located and listed in the Netherlands. The engagement subject matter is done on the basis of corporate
governance aspects.
Score: 3 points
ABN AMRO has an engagement policy that is limited to corporate governance aspects and does
not report on its engagement activities.
The ABN AMRO pension fund’s voting policy is aligned with the corporate governance aspects accepted by its
executive board. The pension fund votes at the general meetings of Dutch and international companies. It
makes use of proxy voting unless the pension fund’s executive board wishes to engage in dialogue with a company. This is limited to companies that are located and listed in the Netherlands.
The implementation of the voting policy is delegated to Glass Lewis. Due to the international character of the
equity portfolio, the pension fund works together with Broadridge, a specialized voting service agency.
The ABN AMRO pension fund publishes on the website its voting record for every for every general meeting in
which it voted within 15 days of the end the quarter. The accumulated voting statistics are also published on the
website. Since 2009, the pension fund has exercised its voting rights for practically the whole equity portfolio.
Score: 3 points
ABN AMRO has a clear voting policy that is limited to corporate governance aspects. It does publish
its voting record.
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No information.
Score: 0 points
The ABN AMRO pension fund makes use of a number of asset managers and service providers:
Activity
Asset Manager
Investments Various asset managers
Coordination investments
ABN AMRO Pensioenbureau
Custodian
BNY Mellon Asset Servicing B.V.
Hosting pension fund administrator
ExcellerateHRO
Proxy voting Broadridge, Glass Lewis
Exclusion polis
Double Dividend, Sustainalytics
Results and attribution tracking,
mandate watch
Vermogensgroep
Payment of pensions
ABN AMRO Pensioenbureau, Raet B.V.
en Equens Nederland B.V.
Score: 2 points
ABN AMRO provides a comprehensive overview of its external asset managers and service providers.
No information.
Score: 0 points
The ABN AMRO pension fund has a publicly available responsible investment policy that provides insight into
the instruments it uses to implement it.
Score: 2 points
ABN AMRO provides partial insight into its responsible investment policy instruments. It does not
publish a list of the companies it invests in.
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4.31 Ahold Pensioenfonds
Ahold Pensioenfonds is a company pension fund. It is the financial services and pension fund provider for
Koninklijke Ahold N.V. and her current and former employees in the Netherlands.
Description
Premium income
45 464
Number of employees
28 799
 1 802.9 million
Equity
33
%
Bonds
46.2 %
Derivatives
5.9 %
Real estate
9.5 %
Alternatives
2.7 %
Cash
2.7 %
The Ahold pension fund is focused on the long term to meet the pension obligations while maintaining a reasonable pension premium from the participants. At the same time, Ahold is well aware of its social responsibility as investor. It makes use of an external party with regards to its socially responsible investment policy.
The European equity and bond portfolio that it manages itself is screened using specific variables. In this way,
Ahold makes sure that there are no companies or countries in the portfolio that could potentially pose a reputation or financial risk. These companies or countries all receive a overall score based on four variables and
are judged based on how they interact with the environment, social (employee) policies, regulations and stakeholders (clients, share- and bondholders).
Score: 2 points
Ahold does have a (socially) responsible investment policy that is publicly available. This policy does
not, however, provide clarity about the instruments that it makes use of or the international
standards upon which it is based.
4.31.2 Exclusions
No information.
Score: 0 points
Ahold’s socially responsible investment policy indicates that its portfolio is screened for environmental, social,
regulatory and stakeholder aspects. To do this, it makes use of information provided by an external party. The
European equity portfolio is reviewed every quarter while the European bond portfolio is checked once a year.
Score: 2 points
There is a general description of ESG-criteria that are considered in portfolio selection.
4.31.4 Engagement
No information.
Score: 0 points
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2 0 0 9
Ahold incidentally makes use of its voting power in its European equity portfolio. Ahold is a member of
Eumedion, in part to keep abreast of the developments in electronic voting. No clarity is provided as to whether its voting behaviour incorporates sustainability themes.
Score: 1 point
Ahold Pensioenfonds does not have a voting policy and votes only incidentally. It is also unclear
whether sustainability themes are incorporated.
No information.
Score: 0 points
Ahold indicates that it manages around two-thirds of its European equity portfolio. External asset managers
are used for the remaining portfolio. Credit Suisse has been given the mandate to manage Ahold’s private
equity and venture capital funds.
Score: 1 point
Ahold provides some information on the use of external asset managers.
No information.
Score: 0 points
Ahold Pensioenfonds publishes an annual report in which its responsible investment policy is outlined. This
policy is meant to avoid investments that can result in negative publicity or potential financial risk. There is
little information with regards to the instruments used.
Score: 2 points
Ahold Pensioenfonds has a responsible investment policy but only partially reports on the instruments
applied.
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2 0 0 9
4.32 Algemeen Pensioenfonds KLM
Algemeen Pensioenfonds KLM is a company pension fund, existing since 1932. The fund is responsible for
implementing the collective pension scheme of KLM, intended for employees of KLM ground staff.
Description
Premium income
 165 million
Active
16 000
Non-active
8 300
Pensioners
9 000
Number of employees
-
 3.9 billion
Equity
39.8 %
Fixed income
56.7 %
Real estate
Other
8.2 %
- 4.7 %
In cooperation with other KLM pension funds, Algemeen Pensioenfonds KLM set up a joint working group on
responsible investment. The group has discussed several proposals for in the beginning of 2008 and published
the following in its magazine Focus, and later in its Annual Report 2008: “The fund understands SRI as investments in activities which are not illegal or prohibited by international treaties. Child labour and violation of
human rights are among the activities. The fund supports the principles of the United Nations on responsible
investment.”
The fund informed its external asset managers about its point of view regarding responsible investment and
has asked them to report about how they can meet the goals of KLM pension funds.
Algemeen Pensioenfonds KLM participates in Eumedion and is a member of Corporate Governance Platform.
Score: 1 point
Algemeen Pensioenfonds KLM’s policy on responsible investment does not consider deliberately chosen
social and environmental issues and has no clear principles and directives going beyond its legal duties.
No information found.
Score: 0 points
Score: 0 points
4.32.4 Engagement
Score: 0 points
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Algemeen Pensioenfonds KLM does neither participate nor vote on annual meetings of the companies it invests
in, because it outsource asset management to external parties.
Score: 1 point
No voting policy.
Score: 0 points
Score: 0 points
The pension fund informs its participants on decisions and has established a participants council.
Score: 2 points
The pension fund occasionally seeks dialogue with participants and policy holders.
The Annual Report and the magazine Focus report on the developments regarding responsible investment.
Score: 2 points
The pension fund only partially reports on decisions regarding its policy.
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2 0 0 9
4.33 ARCADIS Pensioenfonds
ARCADIS Pensioenfonds is a company pension fund. The fund is responsible for implementing the collective
pension scheme of ARCADIS, intended for employees of ARCADIS Nederland.
Description
Premium income
 18.8 million
Active
2 200
Non-active
2 700
Pensioners
2 300
Number of employees
-
 617.5 million
Equity
27.8 %
Fixed income
43.1 %
Derivatives
9.0 %
Hedgefunds
2.8 %
Real estate
17.3 %
In 2008 the discussions regarding responsible investment has resulted in an exclusion policy and special selection of investments in sectors that are close to the working filed of ARCADIS: water, energy and technological innovation. Regarding the exclusion policy the fund set up a list of companies it will not invest in and it
monitors the actual investments of its external asset managers. The policy applies to equity investments. It
is unclear to which principles and issues the list is based upon.
ARCADIS Pensioenfonds is member of Eumedion to support the activities regarding corporate governance.
Score: 2 points
Publicly available policy document that considers instruments used for responsible investments,
but covers only one investment category.
In 2008 the pension fund has made a list of exclusions, applied to equity. Both the principles as well as the
companies listed are unclear.
Score: 2 points
Vaguely defined exclusion policy
Score: 0 points
4.33.4 Engagement
Score: 0 points
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Score: 0 points
According to the Annual Report 2008, as part of its responsible investment activities ARCADIS Pensioenfonds
wishes to invest in sectors close to its own working field: water, energy and technological innovation. No information was provided on projects and investment size.
Score: 1 point
No sustainable project financings.
Score: 0 points
Score: 0 points
The Annual Report 2008 includes a paragraph on the developments regarding responsible investment.
Score: 2 points
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2 0 0 9
4.34 Heineken
The Stichting Heineken Pensioenfonds is responsible for all employees of Heineken Nederlands Beheer B.V.,
employees of liaison companies and employees of the Stichting Heineken Pensioenfonds.
Description
Premium income
66.174
Active participants
5 160
Non-contributing
4 054
Pensioners
3 945
Number of employees
-
 1 738.9
Equity
510.9
29.4 %
Bonds
800.1
46.0 %
Derivatives
2.3
0.01 %
Real estate
204.6
11.8 %
Alternatives
158.4
9.1 %
62.6
3.6 %
Cash
Stichting Heineken Pensioenfonds does not give any information related to responsible investment or a socially responsible investment policy. It is considering expanding its responsible investment activities.
Score: 1 point
No policy document.
4.34.2 Exclusions
No information.
Score: 0 points
No information.
Score: 0 points
4.34.4 Engagement
No information.
Score: 0 points
Heineken makes use of its voting rights for all of its actively managed investments. The topics covered are
limited to corporate governance aspects.
Score: 2 points
Heineken has an active policy that only includes corporate governance issues.
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2 0 0 9
Heineken has a ‘new energy fund’ that invests in alternative energy. This fund is about 1% of the total investment
portfolio.
Score: 2 points
Heineken invests 1% of its capital in sustainable project financing.
Stichting Heineken Pensioenfonds outsources at least part of the portfolio. It is not clear who the asset manageres
are.
Score: 1 point
Stichting Heineken Pensioenfonds provides some information on the use of external asset managers.
No information.
Score: 0 points
No information.
Score: 0 points
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P E N S I O N
F U N D S
I N
T H E
2 0 0 9
4.35 Pensioenfonds Akzo Nobel
Pensioenfonds Akzo Nobel is a company pension fund. The fund is responsible for implementing the collective
pension scheme of Akzo Nobel, intended for employees of Akzo Nobel.
Description
Premium income
 107 million
Active
5 356
Non-contributing
17 420
Pensioners
19 947
Number of employees
0
 3.6 billion
Equities
31 %
Fixed income
52 %
Real Estate
11 %
Commodities
4%
Derivatives
3%
Stichting Pensioenfonds Akzo Nobel (hereafter the “pension fund”) has formulated and implemented a corporate governance & voting policy and an exclusion policy on controversial weapons. The exclusion policy is
applicable to all equity portfolios. The policies are available on the pension fund’s website.
On an annual basis the pension fund screens its equity portfolios on controversies with the principles of the
UN Global Compact.
Score: 3 points
Publicly available policy documents that considers corporate governance issues and an exclusion
instrument, but covers only one investment category.
The pension fund has an exclusion policy with respect to controversial weapons. The pension fund considers
certain types of weapons controversial in case these weapons causes disproportionate number of (deadly) victims, in case these weapons do not make a distinction between military and civil objects and in case these
weapons causes harm after the conflict has been terminated. Besides, controversial weapons, such as cluster
munitions, have a negative long term impact on both economic and social development of a post conflict area.
-
Nuclear weapons;
-
Biological weapons;
-
Chemical weapons;
-
-
Cluster munitions.
The pension funds invest directly in European, American and Japanese equity. The policy is applicable to these
equity portfolios.
The policy with more background information can be found at the pension fund’s website.
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2 0 0 9
Other than controversial weapons the pension fund does not exclude companies.
Score: 3 points
The pension fund does not include ESG criteria in its investment process.
Score: 1 point
No ESG-criteria applied to the selection of investments
4.35.4 Engagement
•
The pension fund does not undertake any engagement activities.
Score: 1 point
No engagement policy
The pension fund has implemented a voting policy to govern the exercise of voting rights for all of the direct
equity investments of the pension fund.
When reviewing resolutions proposed at general meetings the proposals are judged against fundamental principles of good corporate governance, while taking into account best practice standards pertinent both to the
relevant market and international markets. These principles include amongst others:
•
Financial results and auditors
•
Nomination/appointment and dismissal of (non executive) directors
•
Executive compensation and option schemes
•
Mergers and acquisitions
The pension fund draws on the expertise of a specialist research provider, the RiskMetrics Group, who provides information concerning upcoming shareholders meetings of companies in the equity portfolios. Due to the
international character of the pension fund’s equity portfolio it is not possible to attend all general meetings.
The pension fund exercises its voting rights by proxy voting, these services are facilitated by the RiskMetrics
Group as well.
The pension fund is fully committed to communicate its voting activities and discloses its voting conduct on
a detailed level providing information per shareholders’ meeting on its website. Voting reports are available
to the pension fund’s beneficiaries and the general public on a quarterly basis, via ISS Voting Reporting Tool.
The pension fund has not proposed or filed shareholders resolutions on CSR issues at shareholders meetings.
Score: 3 points
The pension fund has an active voting policy that only includes Corporate Governance issues.
•
The pension fund has not developed activities in the field of sustainable financing.
Score: 1 point
The pension fund has outsourced its fiduciary (asset) management to Syntrus Achmea Asset Management.
Syntrus Achmea Asset Management is committed to implement and execute the voting activities on behalf of
the pension fund and to implement and execute the exclusion policy on controversial weapons.
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Besides, a specialist research provider, RiskMetrics Group, facilitates the pension fund in its voting policy.
Score: 2 points
external asset managers, nor how they are committed to is responsible investment policy.
The pension fund shares information about it activities directly to its participants and indirectly to the wider
society. However, the pension fund does not have an active dialogue with the wide society.
Score: 2 points
Akzo Nobel’s pension fund has a dialogue with its participants.
The pension fund reports on the implementation of the corporate governance and voting policy on its website:
•
Voting reporting tool (information on each agenda item voted at a shareholders meetings)
•
Corporate governance and voting report on quarterly basis
•
Corporate governance and voting annual review report.
The exclusion policy is also available on the pension fund’s website.
Score: 3
The pension fund reports on applied instruments and makes its equity holdings public via its
voting reporting tool.
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F U N D S
I N
T H E
2 0 0 9
4.36 Pensioenfonds Ernst & Young
The Stichting Pensioenfonds Ernst & Young is responsible for the collective pension arrangement of the Ernst
& Young organisation in the Netherlands and Holland van Gijzen Advocaten en Notarissen.
Description
Numbers in million euro
Premium income
 22.6
Active participants
4 637
Non-contributing
9 322
Pensioners
1 144
Number of employees
-

Equity
18.5 %
Bonds
71.3 %
Derivatives
-%
Real estate
7.3 %
Alternatives
-%
Cash
-%
Stichting Pensioenfonds Ernst & Young has a unique investment policy. Ernst & Young provides accountancy
services for the two re-insurers that invests its assets, and therefore has to adhere to strict rules to avoid a
potential conflict of interest. This means that the investment income is calculated based on a specific external benchmark per asset class and it also means that it does not have any input into the investments made
by Aegon and Nationale-Nederlanden on its behalf.
Its annual report does not provide any information related to responsible investment or a socially responsible
investment policy.
Score: 0 points
4.36.2 Exclusions
No information.
Score: 0 points
No information.
Score: 0 points
4.36.4 Engagement
No information.
Score: 0 points
No information.
Score: 0 points
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2 0 0 9
No information.
Score: 0 points
Stichting Pensioenfondse Ernst & Young has reinsured all assets through AEGON and Nationale-Nederlanden.
Score: 2 points
Stichting Pensioenfondse Ernst & Young provides information on the use of external asset managers.
No information.
Score: 0 points
No information.
Score: 0 points
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F U N D S
I N
T H E
2 0 0 9
4.37 Pensioenfonds Fortis Bank Nederland
The Stichting Pensioenfonds Fortis Bank Nederland is a corporate pension fund that provides pension fund
services for its (ex) employees.
Description
Premium income
 97
Active
9,018
Non-contributing
9,208
Pensioners
2,514
Number of employees
-
 2 072
Equity
 246
12 %
Fixed interest
 1 683
81 %
Derivatives
 10
1%
Real estate
 46
2%
Other
 81
4%
Pensioenfonds Fortis Bank Nederland does not provide any information related to responsible investment or a
socially responsible investment policy.
Score: 0 points
4.37.2 Exclusions
No information.
Score: 0 points
No information.
Score: 0 points
4.37.4 Engagement
No information.
Score: 0 points
No information.
Score: 0 points
No information.
Score: 0 points
No information.
Score: 0 points
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F U N D S
I N
T H E
2 0 0 9
Pensioenfonds Fortis Bank Nederland indicates in its annual report that its participants’ organisation advises
the board.
Score: 2 points
Pensionfonds Fortis Bank Nederland occasionally seeks a dialogue with participants and policy holders.
No information.
Score: 0 points
145
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F U N D S
I N
T H E
2 0 0 9
4.38 Pensioenfonds Gasunie
The Stichting Pensioenfonds Gasunie provides pension fund services for Gasunie employees.
Description
Premium income
-
-
Number of employees
-
-
Equity
-
Bonds
-
Derivatives
-
Real estate
-
Alternatives
-
Cash
-
Stichting Pensioenfonds Gasunie does not provide any information related to responsible investment or a socially responsible investment policy.
Score: 0 points
4.38.2 Exclusions
No information.
Score: 0 points
No information.
Score: 0 points
4.38.4 Engagement
No information.
Score: 0 points
No information.
Score: 0 points
No information.
Score: 0 points
No information.
Score: 0 points
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F U N D S
I N
T H E
2 0 0 9
No information.
Score: 0 points
No information.
Score: 0 points
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2 0 0 9
4.39 Pensioenfonds Hoogovens
Stichting Pensioenfonds Hoogovens provides pension services for the (ex) employees of the Sociale Eenheid
IJmuiden. This includes the Corus and DSM Agro facilities located in Ijmuiden.
Description
Premium income
 92
Active
Non-contributing
Pensioners
Number of employees
-
 4 748
11 312
8 083
16 154
Equity
 810
17 %
Bonds
 3 133
66 %
Real estate
 498
10 %
Financings
 -139
-3%
Other
 446
9%
The Pensioenfonds Hoogovens’ Annual Report for 2008 contains a section on socially responsible investment.
The pension fund feels it is important that the investments are done in a socially responsible manner and is
therefore working to define the appropriate criteria. External asset managers are selected and judged based
also on their responsible investment policy.
Score: 1 point
Hoogovens intends to formulate a responsible investment policy, but this has not happened yet.
No information.
Score: 0 points
The Pensioenfonds Hoogovens states that responsible investment is important, but has not formulated any
ESG-criteria for its investments.
Score: 1 point
No investment portfolio selection based on ESG-criteria.
4.39.4 Engagement
The Pensioenfonds Hoogovens carries out engagement activities for its equity portfolio through its asset managers on the topic of corporate governance.
Score: 3 points
Hoogovens has an engagement policy, but it is limited to corporate governance issues and does not
report on its activities.
The Pensioenfonds Hoogovens carries out engagement activities for its equity portfolio through its asset mana-
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2 0 0 9
gers on the topic of corporate governance. This may include voting activities.
Score: 1 point
Hoogovens makes no explicit reference to a voting policy, but could fall under the
corporate governance policy.
No information.
Score: 0 points
The Pensioenfonds Hoogovens makes use of external asset managers. Which parties these are is not provided,
and neither is how they are to follow Hoogovens’ responsible investment policy.
Score: 0 points
No information provided on outsourcing.
No information.
Score: 0 points
The Pensioenfonds Hoogovens states that a responsible investment policy is in the process of being formulated but this document and the applied instruments are not publicly available.
Score: 1 points
No reporting on activities regarding responsible investment.
149
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T H E
2 0 0 9
4.40 Stichting Pensioenfonds IBM Nederland
Stichting Pensioenfonds IBM Nederland (SPIN) is company pension fund for employees of IBM Nederland and
affiliated companies, established in 1995. Currently about 30% of employers are affiliated with the MPF. MPF
has outsourced its activities to PVF Achmea, subsidiary of Syntrus Achmea. In august 2009 MPF has established a participants council.
We could not find any information on the internet about is responsible investment policy, MPF does not have
a website, and there was no response to the questionnaire.
Description
Numbers (as per 31 December 2008)
Premium income
 55 million
Active
4 514
Passive
5 971
Pensioners
4 463
Number of employees
19 (fte)
 2.4 billion
Distribution among investment categories (%)
Equity
-
Corporate bonds
-
Government bonds
-
Loans
-
Real estate
-
Participations
-
Other
-
The fund recognizes its social responsibility as an institutional investor, to implement a responsible investment policy, but has limited influence because of investments in common funds. The Annual Report 2008 also
speaks of adaption of its voting policy, screening of its investments based on sustainability criteria and dialogue with its asset managers about integration of responsible investment in their policies. There was no information about whether these decisions were actually implemented in 2009.
Score: 1 point
Policy in development
Score: 0 points
Score: 0 points
4.40.4 Engagement
According to the Annual Report 2008, the fund has spoken with its external parties to start engagement with
companies on behalf of Pensioenfonds IBM Nederland. Whether asset managers will engage with companies or
what the priorities are remains unclear.
Score: 1 point
No publicly available policy with regards to engagement.
150
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F U N D S
I N
T H E
2 0 0 9
According to the Annual Report 2008, SPIN has spoken with its external parties to give more weight to ESGcriteria in voting. What this exactly entails remains unclear.
Score: 1 point
No publicly available document with regards to voting.
Score: 0 points
The pension fund administration is outsourced to ASR Pension Fund Services (the former Fortis Pension Fund
Service). Asset management is also outsourced to external managers, but the fund does not mention any
names in its Annual Report 2008.
Score: 1 point
Clear about outsourcing but no complete overview.
Score: 0 points
Score: 0 points
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F U N D S
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2 0 0 9
4.41 Pensioenfonds ING
The Stichting Pensioenfonds ING is a corporate pension fund. It provides pension fund services for (ex) ING
employees in the Netherlands.
Description
Numbers (as per 31 December 2008)
Premium income
Active
31 941
Non-contributing
27 005
Pensioners
14 369
Number of employees
 9 958
Equity
 3 091
31 %
55 %
Fixed interest
 5 483
Derivatives
 186
2%
Real estate
 842
8%
Hedge funds
 274
3%
Private equity
 83
1%
The ING pension fund mentions a responsible investment policy in its annual report. ‘Pensioenfonds ING fully
understands that it must continue to achieve a return within the boundaries of its social responsibilities. A
policy has therefore been developed for this purpose. Within the social responsibility that the fund defines
for itself, sustainability is, of course, highly desirable’. It also mentions the ‘ING defense policy’, in which
companies are excluded that are active in the production of controversial weapons.
ING has established an ESG Code that will come into effect in January 2010. It will be published as soon as the
Code has been approved by all relevant parties. ING Pensioenfonds will also sign on to Eumedion and UNPRI.
Score: 2 points
ING Pensioenfonds states its responsibility as investor, but only briefly mentions the instrument(s)
applied.
4.41.2 Exclusions
ING Pensionfonds subscribes to the ‘ING defense policy’, in which companies are excluded that are active in
the production of controversial weapons. This policy is publicly available.
ING Pensioenfonds is in the process of selecting a partner for the ESG overlay.
Score: 3 points
ING has a publicly available and clearly defined exclusion policy concerning one issue.
No information.
Score: 0 points
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4.41.4 Engagement
ING Pensioenfonds is in the process of selecting a partner for the ESG overlay.
Score: 0 points
ING Asset Management BV carries out the asset management for ING Pensioenfonds. This also means that the worldwide voting policy for ING Groep also applies for ING Pensioenfonds. ING Asset Management BV publishes a quarterly account of its voting activities.
One of the principles of the ING Groep voting policy states that companies in which it invests must take all stakeholders into account. This means that companies must realize the impact of their activities on the environment
and the impact of their activities on social and human rights issues in the regions where they are active.
ING Pensioenfonds is planning to report on its voting activities using its website on an annual basis. ING
Pensioenfonds is also in the process of selecting a partner for the ESG overlay.
Score: 3 points
ING has an active voting policy that explicitly includes social and environmental issues.
No information.
Score: 0 points
ING Pensioenfonds has outsourced its asset management to ING Asset Management BV. AZL Vermogensbeheer
BV carries out fiduciary management for its private equity and hedge fund investments. ING Real Estate
Investment Management Ltd. takes care of the non-publicly traded part of the real estate portfolio. Russell
Investment Group Ltd. also has a number of mandates.
Score: 2 points
ING is clear about its outsourcing and provides a complete list of its asset managers and service
providers.
The ING Pensioenfonds board met twice with its participants’ organisation (deelnemersraad).
Score: 2 points
ING occasionally seeks a dialogue with its participants.
ING Pensioenfonds includes a section on responsible investment policy in its annual report. There is, however, no reporting on the instruments applied except for a short section on its exclusion policy.
Score: 2 points
ING reports only partially on applied instruments.
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4.42 Stichting Pensioenfonds KPN
Stichting Pensioenfonds KPN is a company pension fund that carries out the pensions for all personnel of KPN
and related companies.
Description
Premium income
 73,878
Active
18 219
Passive
21 200
Pensioners
11 487
Number of employees
0
 3 500
Equity
36.5 %
Corporate bonds
Government bonds
44.8 %
Loans
Real estate
12.7 %
Participations
-
Other
Commodities
3.4 %
Hedge funds
3.0 %
Cash
- 0.4 %
Pensioenfonds KPN has a responsible investment policy covering investments in equity and fixed income. Asset
management is outsourced to TKP Investments, which carries out the responsible investment policy as described by the pension fund. The policy is available on the fund’s website and is included in the Investment
Guidelines (Beleggingsbeginselen), which are also published on the website.
Score: 4 points
SRI policy based on UN Global Compact, using multiple instruments, and covers both equity and fixed
income investments.
Pensioenfonds KPN has an exclusion policy stating that companies that are directly involved in the production of controversial weapons are excluded from investment. The list with companies to be excluded is based
on the “Controversial Weapons Radar” that is put together and reviewed on an annual basis by Sustainalytics
and is updated on an annual basis. The following weapons are defined as controversial:
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Nuclear weapons
•
Biological weapons
•
Chemical weapons
•
Cluster weapons
•
Munitions with depleted uranium
•
Anti-personnel mines
B E N C H M A R K
I N V E S T M E N T
B Y
P E N S I O N
F U N D S
I N
T H E
2 0 0 9
The exclusion list can be found on the website of TKP Investments. This list is applied to equity and fixed
income investments (company loans) and is updated annually.
Score: 4 points
Exclusion policy based on one criterion (controversial weapons). The list of excluded companies is
publicly available at TKP’s website.
Several years ago Pensioenfonds KPN invested in a sustainable equity fund. This fund invests in equity of global listed companies that meet certain requirements with respect to ESG criteria.
Score: 3 points
The fund’s ‘Beleggingsbeginselen’ describe the use of a best-in-class fund, but the document doesn’t
provide detailed information on ESG-criteria used, nor names of companies included in the fund.
4.42.4 Engagement
Once a year, the equity and bond portfolios screened on compliance with the UN Global Compact by
Sustainalytics. Engagement activities are undertaken with a selection of the non-compliant companies. If
after a period of three years engagement activities do not result in improved performance on ESG criteria,
the fund considers exclusion of investment for the company in question
At the end of 2008, Pensioenfonds KPN was carrying out active engagement with a selection of ten companies
which were non-compliant with the UN Global Compact. The results of the engagement activities will be published in the annual report 2009. The companies with which engagement activity is currently undertaken are:
-
Anglo Gold Ashanti
-
Barrick Gold
-
Bharat Heavy Electricals
-
Bridgestone
-
Hyundai Development
-
Nippon Oil
-
PTT EP
-
Wal-Mart de Mexico
-
Freeport-McMoRan
-
Vedanta Resources
In 2007, Pensioenfonds KPN decided to participate in the Governance Platform, an initiative of the Deminor
Group, that joins forces of large institutional investors. Deminor undertakes a continuous dialogue with listed
companies, on behalf of the platform. In 2009 these companies are AEGON, Akzo Nobel, Alstom, Bristish Sky
Broadcasting, Daimler, Enel, KPN, Nestlé, Philips, Reed Elsevier, Roche, Shell, Siemens, Telefonica, TNT, Total,
UBS, Unilever. If it concerns dialogue with KPN, TNT or AEGON, Pensioenfonds KPN does not take part in the
meetings, and determination of the goals and content of the dialogue is left to the other members of the
Governance Platform.
Score: 5 points
Engagement policy based on UN Global Compact, and linked to exclusion policy. Publication of
screening results are available on the TKP website, and results of engagement activity is published
by Pensioenfonds KPN.
Pensioenfonds KPN has a voting policy, which was expanded to cover European companies in 2009. Companies
falling outside the voting policy are KPN, TNT and AEGON, as the fund does not vote at shareholder meetings
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of these companies by principle. The investment funds in which the pension fund invests sometimes lend equity
to third parties (securities lending). On these shares no voting rights can be exercised. The fund decides per
company whether the advantages of security lending offset the loss of the voting rights.
The voting activity on shareholder meetings in which the fund invests is reported on the website.
Score: 3 points
Pensionfonds KPN / TKP Investments has an active voting policy that includes corporate governance
issues, but does not explicitly include social or environmental issues. It also publishes its voting
activities.
Pensioenfonds KPN does not undertake sustainable project financing.
Score: 1 point
No sustainable project financing.
Pensioenfonds KPN’s asset management is fully outsourced to TKP Investments. TKP Investments carries out
the responsible investment policy as described by the pension fund.
Score: 3 points
Transparency regarding outsourcing of asset management and commitment of the asset manager to the
fund’s SRI policy.
Participants of Pensioenfonds KPN are informed about the content and implementation of the social responsible
investment policy by means of the “Pensioenkrant” and on the website. The dialogue on the issue is held within
the fund’s governing board, which forms a good representation of all parties involved. Decisions with respect to
investment policy are made by the governing board, after assessment of the impact on risk and return.
Score: 2 points
No active engagement of the fund’s participants, policy holders or other representatives of society in
a SRI-dialogue.
Pensioenfonds KPN uses both its website and the annual report to communicate the policies and activity with
respect to socially responsible investment.
Reporting on instruments in the fund’s annual report and on the website of TKP Investments. No details provided with respect to investments.
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2 0 0 9
4.43 Pensioenfonds Stork
The Stichting Pensioenfonds Stork is a corporate pension fund that provides pension fund services for its (ex)
employees.
Description
Premium income
 78
Active participants
9 354
Non-contributing
25 268
Pensioners
14 979
Number of employees
40
 2 137
Equity
 599
28 %
Fixed interest
 899
42 %
Derivatives
 153
7%
Real estate
 348
16 %
Other
 138
7%
Stichting Pensioenfonds Stork does not provide information related to responsible investment on its website
and has no socially responsible investment policy publicly available.
Score: 0 points
4.43.2 Exclusions
No information.
Score: 0 points
No information.
Score: 0 points
4.43.4 Engagement
No information.
Score: 0 points
Stork Pensioenfonds deems it important that managers align their voting at shareholder meeting with the fund’s
policy. For the Netherlands, Pensioenfonds Stork’s voting guidelines follow Eumedion’s policy, outside the
Netherlands ISS guidelines are followed.
Score: 2 points
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Pensioenfonds Stork invests 1,5% of its assets in micro finance projects. There is however no information available on the website about the individual projects or the criteria for selection of these projects.
Score: 2 points
The pension fund invests in sustainable projects, but has no policy and does not provide information on
projects.
No information.
Score: 0 points
Stork Pensioenfonds indicates in its Annual Report 2008 that its participants’ organisation (deelnemersraad)
met a total of three times with the board, but the subjects discussed are unclear.
Score: 2 points
The pension fund occasionally seeks dialogue with participants and policy holders.
No information.
Score: 0 points
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2 0 0 9
4.44 Pensioenfonds TNO
Pensioenfonds TNO is a company pension fund, responsible for implementing the collective pension scheme
of TNO since 1939 and intended for employees of companies affiliated with TNO.
Description
Premium income
 45 million
Active
5 551
Passive
4 802
Pensioners
2 772
Number of employees
15
 1.9 billion
Distribution among investment categories
(per 30 July 2009)
Equity
Corporate bonds
Government bonds
26 %
9%
27 %
Loans
-%
Real estate
7%
Private equity
10 %
Other (incl. overlays and
structured products)
21 %
Pensioenfonds TNO has developed a responsible investment policy based on the UN Global Compact principles. Companies that are non-compliant can be excluded from investments. But before the board will decide
to do so, the organisation that executes the policy will engage with companies, and at first, its asset managers. The Ethics Committee for the Pensioenfonds TNO consists of 3 board members, the director of the fund
and an internal investment manager.
The policy applies to equity and is published on the website. Possible extension to other categories in currently researched.
Score: 3 points
Publicly available policy document that considers deliberately chosen social and environmental issues,
based on clear principles and clarifies the use instruments, but covers only one investment category.
Pensioenfonds TNO excludes companies systematically on compliance to the ten principles of the UN Global
Compact. This includes activities related to human rights issues, working conditions, environment and anti
corruption. Pensioenfonds TNO established for the implementation of its policy an Ethics Committee that evaluates the controversial activities of enterprises and gives an advise to the board. The research and screening
of companies is carried out by Sustainalytics.
The website does report on the amount of companies that are excluded (2) but does not publish a list with
names of companies.
Score: 4 points
Publicly available and clearly defined exclusion policy concerning various social and environmental
issues.
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2 0 0 9
Positive selection of investment with a best-in-class approach is currently considered.
Score: 1 point
No use of ESG-criteria for selection of investments.
4.44.4 Engagement
Pensioenfonds TNO is engaging with its external asset managers to apply the exclusion policy. It looks like all
asset managers will comply. Russell has, for example, recently signed the Global Compact Principles.
Companies are excluded once engagement efforts undertaken by Sustainalytics are unsuccessful.
Score: 2 points
The fund has a policy on engagement that is currently being implemented by its asset managers, but
dialogue with companies has not yet taken place.
The voting policy of Pensioenfonds TNO is available on the website and based on the Code Tabaksblat and Eumedion
guidelines. In the Netherlands voting is executed via the network of Eumedion and for companies for which the
investment represents at least 1% of the outstanding equity. Securities lending for voting purposes is prohibited.
For execution of voting rights on international companies the fund uses a proxy voting service for a selection
of investments, based on OECD Guidelines for Corporate Governance.
Finally, Pensioenfonds TNO follows the voting policies of investment funds. Report on voting behaviour is
published quarterly on the website and in the annual report.
Score: 3 points
The pension fund has an active voting policy that includes Corporate Governance issues and reports
on its voting activities.
No financing of projects with high sustainability relevance.
Score: 1 point
Pensioenfond TNO has outsourced it asset management as well as activities on responsible investment to,
amongst others: Vanguard, Walter Scott, Russell, BNP Paribas, BCM, Morgan Stanley, Knight Vinke, BlackRock,
Montag & Caldwell, EIM, various PE(RE)- managers, Sustainalytics and Eumedion.
The fund asks asset managers to apply its exclusion policy, based on the non-compliance list of Sustainalytics.
Score: 2 points
The pension fund provides a comprehensive overview of external parties and formalizes their
commitment to its responsible investment policy.
The responsible investment policy is discussed with the participants council.
Score: 2 points
The pension fund seeks dialogue with participants.
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The annual report of Pensioenfonds TNO pays attention to responsible investment and each quarter a list of
all companies in which it holds equity is published.
Score: 3 points
The pension fund publishes a detailed overview of companies within one investment category in which
investments are made and partially reports on applied instruments.
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2 0 0 9
4.45 Stichting Pensioenfonds TNT
Stichting Pensioenfonds TNT is company pension fund that carries out the pensions for all personnel of TNT
and Postkantoren BV.
Description
Premium income
 113 million
Active
42 063
Passive
32 366
Pensioners
17 682
Number of employees
0
 3.9 billion
Equity
Corporate bonds
Government bonds
Loans
Real estate
Participations
37.5 %
44.8 %
11.7 %
-
Other
Commodities
Hedge funds
Cash
3.4 %
2.9 %
- 0.3 %
Pensioenfonds TNT has a responsible investment policy covering investments in equity and fixed income. Asset
management is outsourced to TKP Investments, which carries out the responsible investment policy as described
by the pension fund. The policy is available on the fund’s website and is included in the Investment Guidelines
(Beleggingsbeginselen), which are also published on the website.
Score: 4 points
SRI policy based on UN Global Compact, using multiple instruments, and covers both the equity and fixed
income portfolio.
Pensioenfonds TNT has an exclusion policy stating that companies that are directly involved in the production of
controversial weapons are excluded from investment. The list with companies to be excluded is based on the
“Controversial Weapons Radar” that is put together and reviewed on an annual basis by Sustainalytics, and is
updated on a yearly basis. The following weapons are defined as controversial:
162
•
Nuclear weapons
•
Biological weapons
•
Chemical weapons
•
Cluster weapons
•
Munitions with depleted uranium
•
Anti-personnel mines
B E N C H M A R K
I N V E S T M E N T
B Y
P E N S I O N
F U N D S
I N
T H E
2 0 0 9
The exclusion list can be found on the website of TKP Investments. This list is applied to equity and fixed income investments (company loans) and is updated annually.
Score: 4 points
Exclusion policy based on one criterion (controversial weapons). The list of excluded companies is
publicly available at TKP’s website.
Several years ago, Pensioenfonds TNT invested in a sustainable equity fund. This fund invests in global listed company equity that meets certain requirements with respect to ESG criteria.
Score: 3 points
The fund’s ‘Beleggingsbeginselen’ describe the use of a best-in-class fund, but the document doesn’t
provide detailed information on ESG-criteria used, nor names of companies included in the fund.
4.45.4 Engagement
Once a year, the equity and bond portfolios are screened on compliance with the UN Global Compact by
Sustainalytics. Engagement activities are undertaken with a selection of the non-compliant companies. If after a
period of three years engagement activities do not result in improved performance on ESG criteria, the fund considers exclusion of investments for the company in question.
At the end of 2008, Pensioenfonds TNT was carrying out active engagement with a selection of ten companies
which were non-compliant with the UN Global Compact. The results of the engagement activities will be published in the annual report 2009. The companies with which engagement activity is currently undertaken are:
-
Anglo Gold Ashanti
-
Barrick Gold
-
Bharat Heavy Electricals
-
Bridgestone
-
Hyundai Development
-
Nippon Oil
-
PTT EP
-
Wal-Mart de Mexico
-
Freeport-McMoRan
-
Vedanta Resources
In 2007, Pensioenfonds TNT decided to participate in the Governance Platform, an initiative of the Deminor
Group, that joins forces of large institutional investors. Deminor undertakes a continuous dialogue with listed
companies, on behalf of the platform. In 2009 these companies are AEGON, Akzo Nobel, Alstom, Bristish Sky
Broadcasting, Daimler, Enel, KPN, Nestlé, Philips, Reed Elsevier, Roche, Shell, Siemens, Telefonica, TNT, Total,
UBS, Unilever. If it concerns dialogue with TNT, KPN or AEGON, Pensioenfonds TNT does not take part in the
meetings, and determination of the goals and content of the dialogue is left to the other members of the
Governance Platform.
Score: 5 points
Engagement policy based on UN Global Compact, and linked to exclusion policy. Publication of screening
results are available on the TKP website, and results of engagement activity is published by
Pensioenfonds TNT.
Pensioenfonds TNT has a voting policy, which was expanded to cover European companies in 2009. Companies
falling outside the voting policy are TNT, KPN and AEGON, as the fund does not vote at shareholder meetings
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of these companies by principle. The investment funds in which the pension fund invests sometimes lends shares to third parties (securities lending). On these shares no voting rights can be exercised. The fund decides
per company whether the advantages of security lending even out the loss of the voting rights.
The voting activity on shareholder meetings in which the fund invests is reported on the website.
Score: 3 points
Pensioenfonds TNT / TKP Investments has an active voting policy that includes corporate governance
issues, but does not explicitly include social or environmental issues. It does publish its voting
activities.
Pensioenfonds TNT does not undertake sustainable project financing.
Score: 1 point
Pensioenfonds TNT’s asset management is fully outsourced to TKP Investments. TKP Investments carries out
the responsible investment policy as described by the pension fund.
Score: 3 points
Transparency regarding outsourcing of asset management and commitment of the asset manager to
the fund’s SRI policy.
Participants of Pensioenfonds TNT are informed about the content and implementation of the social responsible investment policy by means of the “Pensioenkrant” and on the website. The dialogue on the issue is
held within the fund’s governing board, which forms a good representation of all parties involved. Decisions
with respect to investment policy are made by the governing board, after assessment of the impact on risk
and return.
Score: 2 points
No active engagement of the fund’s participants, policy holders or other representatives of
society in a SRI-dialogue.
Pensioenfonds KPN uses both its website and the annual report to communicate the policies and activity with
respect to socially responsible investment.
Score: 2 points
Reporting on instruments in the fund’s annual report and on the website of TKP Investments.
No details provided with respect to investments.
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4.46 Pensioenfonds UWV
Pensioenfonds UWV is a corporate pension fund. It provides pension fund services for UWV’s employees.
Description
Premium income
 135
Active
18 753
Non-contributing
19 563
Pensioners
8 132
Number of employees
 3 140
Equity
18.5 %
Fixed interest
64.2 %
Real estate
13 %
Convertibles
2.1 %
Commodities
0.7 %
Cash
1.5 %
UWV does have a responsible investment policy. This policy states that it is UWV pension fund’s belief that
sustainability can deliver a positive contribution to the funds’ investment performance over the long run and
covers the equity and bond asset classes. It is, however, not publicly available.
The 2008 annual report mentions that the fund held a number of sessions with external experts on the topic
of sustainability criteria and its investment policy. Because UWV has a lot of pooled investments, this issues
is quite complex. It was decided that sustainability and responsible investment will play a role in the new
strategic allocation of the investments.
Score: 1 point
UWV does not have a publicly available responsible investment policy.
4.46.2 Exclusions
UWV currently does not have ESG-criteria for exclusions, but an ESG policy will be further developed and
implemented in 2010.
Score: 1 point
UWV currently does not have an exclusion policy.
UWV Pensioenfonds will further develop and implement its ESG policy in 2010 and considers positive selection as a part of its new thematic sustainable asset class. These themes can be issues like climate change (eg.
Clean energy) and the aging population (eg. Zorgboulevards).
Score: 1 point
UWV currently does not apply ESG criteria to its investments.
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4.46.4 Engagement
UWV Pensioenfonds indicates that it currently does not have an engagement policy. One of its asset managers
is, however, active in engagement.
Score: 1 point
UWV does not have an engagement policy.
UWV Pensioenfonds votes, along with other pension funds, via Eumedion. For the rest, it indicates that its ESG
policy will be further developed and expanded in 2010.
Score: 2 points
Through Eumedion, UWV has a voting policy with respect to corporate governance.
At this point in time, UWV does not have a sustainable project financing policy, but this will likely be a part
of its new thematic sustainable asset class from 2010 on. There are a number of thematic investment ideas
like microfinance.
Score: 1 point
UWV currently does not have a responsible investment policy.
UWV Pensioenfonds indicates in its annual report that it makes use of a number of asset managers while BNY
Mellon acts as its custodian. In 2010 it will begin outsourcing via a fiduciary manager. This will enhance transparency and will enable UWV to better incorporate sustainability into its integral strategic ambitions.
Score: 1 point
UWV provides limited transparency into its outsourcing.
UWV Pensioenfonds has an active dialogue with its members via its members’ council (deelnemersraad). It
also maintains contact with its pensioners’ society and acts as a speaker at its annual meeting. UWV is also a
member of the OPF (the association for corporate pension funds), and participates actively in several of its
activities.
Score: 2 points
UWV maintains a dialogue with its members.
UWV Pensioenfonds currently does not report on its responsible investment policy. But this will be further
developed with its new ESG policy.
Score: 2 points
UWV reports that it is in the process of applying a responsible investment policy.
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4.47 Pensioenfonds VolkerWessels
The Stichting Pensioenfonds VolkerWessels is a corporate pension fund that provides pension fund services for
more than 70 Dutch businesses that belong to VolkerWessels.
Description
Premium income
 915
Active
4 493
Non-contributing
3 521
Pensioners
2 423
Number of employees
40
 895
Equity
 18
Fixed interest
 687
2%
Derivatives
0
0%
Real estate
 61
7%
Other
 129
77 %
14 %
Pensioenfonds VolkerWessels provides information on its responsible investment policy on the website. This
documents provides a general direction or vision and is a start for an official investment policy. Currently the
fund is discussing the activities to implement the responsible investment policy with the parties that take care
of the asset management.
Score: 1 point
Pensioenfonds VolkerWessels currently has no publicly available responsible investment policy
document.
4.47.2 Exclusions
All investments of Pensioenfonds VolkerWessels are externally managed. The new mandates for asset managers include responsible investment. In the current mandates there are no guidelines concerning exclusions.
Score: 1 point
Pensioenfonds VolkerWessels currently has no publicly available policy concerning exclusions.
The responsible investment vision of Pensioenfonds VolkerWessels is based on the Global Compact and UN PRI,
although these principles are not clearly translated into investment criteria for asset managers. In this vision
it is mentioned what methods asset managers can use, the fund does not prioritize one method over the other.
Score: 2 points
The responsible investment policy, based on Global Compact and UN PRI is currently being translated
into concrete investment criteria with asset managers.
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4.47.4 Engagement
The set-up of the engagement policy of Pensioenfonds VolkerWessels is currently being discussed with the
asset managers.
Score: 1 point
Pensioenfonds VolkerWessels does not have engagement policy
Pensioenfonds VolkerWessels only invest in equity through funds and is unable to actively vote. From the corporate governance policy it appears that the fund agreed with asset managers that they keep to the OECD
guidelines and the NCGC. Pensioenfonds VolkerWessels is also a member of Eumedion. The voting policy is also
currently being discussed with asset managers.
Score: 2 points
Currently only voting on corporate governance.
There is no specific focus on sustainable project financing. Projects that live up to the risk-return criteria can
be included in the investment portfolio.
Score: 1 point
The tactical and operational asset management is outsourced to FLM N.V. and EIM S.A. The strategic asset
management is in the funds own hands.
Score: 2 points
It is clear whom Pensioenfonds VolkerWessels outsources its asset management to. The assets under
management per asset manager are known. It is unclear how these asset managers are held to
responsible investment policy or vision.
VolkerWessels Pensioenfonds indicates that it sometimes engages in dialogue with participants, also on the
topic of responsible investment. However, these are not structural meetings and there are no reports available.
Score: 2 points
There is a dialogue, but not specifically on ESG issues.
Because the discussion with external asset managers on the responsible investment policy was not finished in
2008, the first information on this topic will be published in the annual report for 2009.
Score: 1 point
Currently no reporting on the responsible investment policy.
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4.48 Pensioenfonds Wolters Kluwer
Pensioenfonds Wolters Kluwer is a company pension fund. The fund is responsible for implementing the collective pension scheme of Wolters Kluwer Nederland.
Description
Premium income
 24 million
Active
1 532
Non-active
5 282
Pensioners
1 854
Number of employees
-
 616 million
Equity
26.5 %
Bonds
60.6 %
Private equity
1.5 %
Loans
4.8 %
Real estate funds
5.7 %
Other
0.9 %
In 2008 Pensioenfonds Wolter Kluwer drafted the note “Sustainable Investment” that provide a framework for
the development of responsible investment. The pension fund considers responsible investment as investment
that takes into account environment, ethics, corporate governance and social issue (the so-called ESG-principes). There is a multitude of criteria which the pension funds will take into account: child labor, environment, corruption, animal testing and others. To avoid discussions the pension fund has chosen for compliance with generally accepted principles laid down in the UN Global Compact. Besides that the pension fund has
also determined its voting policy.
Score: 2 points
Publicly available policy that considers social and environmental issues and is based on clear
principles.
Pensioenfonds Wolter Kluwer does not apply negative selection to its investment, but as chosen for an engagement approach.
Score: 1 point
No exclusion policy.
In general the pension fund will use ESG-criteria for the selection of investments, laid down in its ‘investment
beliefs’. This is only applied to the selection of investments in real estate. The fund is planning to use them
within the category of private equity.
Score: 2 points
General statement that ESG criteria are included in selecting investments for the investment
category real estate.
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4.48.4 Engagement
Pensioenfonds Wolters Kluwer has limited engagement activities that will be developed progressively during
implementation.
Score: 1 point
No engagement activities, but planning to develop them.
Pensioenfonds Wolters Kluwer has established a voting policy in 2008 and published it on its website. The pension fund only participates in investment funds and cannot vote, but supports the voting policy of external
asset managers that focuses on shareholders value.
Score: 1 point
The pension fund has no active voting policy.
Pensioenfonds Wolters Kluwer has no sustainable project financing implemented, but is planning to do so the
coming years.
Score: 1 point
The selection of investments are outsourced to external asset managers, almost all by participating in investment funds. The fund does not select its asset managers based on experience with applying ESG-criteria.
Score: 1 point
The pension fund is clear about its outsourcing but does not provide a comprehensive overview of its
external asset managers.
Stichting Pensioenfonds Wolters Kluwer Nederland cooperates wit hits participants council, but does not have
a dialogue with society.
Score: 2 points
The pension fund occasionally seeks dialogue with participants.
The Annual Report 2008 includes a paragraph on the developments regarding responsible investment.
Score: 1 point
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4.49 Philips Pensioenfonds
Stichting Philips Pensioenfonds is a corporate pension fund. The pension fund carries out the pension arrangements covering all Philips employees in the Netherlands.
Description
Premium income
 139 million
Active
19 652
Pensioners
60 254
Number of employees
20
 13.2 billion
Equity
13.4 %
Fixed Income
74.6 %
Real Estate
4.1 %
Other
7.9 %
Philips Pensioenfonds sets the financial interest of its participants as its priority. The fund however is of the
opinion that this duty to its participants can be well combined with the integration of environmental, social
and governance (ESG) criteria in the investment policy. The fund – being a long-term investor - finds itself in
an excellent position to engage in a dialogue with companies that lag behind in ESG-areas.
During 2008 Philips Pensioenfonds gained experience in responsible investments with a so-called ESG pilotportfolio. Based on this pilot, the Board of Trustees decided early 2009 upon a gradual integration of ESG criteria covering the full breadth of investments. The fund today measures the ESG-content of all equity and
credit portfolios and intends to gradually scan the rest of the portfolio against ESG criteria. In order to do
this, cooperation has been sought with leading providers of ESG-research. Investments are assessed periodically on criteria such as environment, human rights, labour conditions, and good governance. Guiding principles in this assessment are the principles of the Global Compact, an initiative of the UN, that promotes corporate social responsibility. In eventual cases, the asset manager (BlackRock) will engage in dialogue with
companies, when these are clearly noncompliant with the aforementioned criteria. As a shareholder, Philips
Pensioenfonds can influence the policy of the companies in which it invests.
Score: 4 points
SRI policy is described on the website. It is based on the principles of the UN Global
Compact, includes various instruments, and covers multiple asset classes.
Philips Pensioenfonds has decided to exclude investments in producers of controversial weapons (anti-personnel landmines, cluster bombs, chemical, biological and nuclear weapons). The fund also excludes companies that – after engagement activities - don’t improve their behaviour with respect to ESG criteria.
Score: 3 points
No policy document, but description on website. Exclusion based on controversial weapons and where
engagement fails, but no list of excluded companies provided.
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The fund assesses all equity and credit investments periodically on criteria such as environment, human rights,
labour conditions and good governance, for which the principles of the UN Global Compact form the guiding principles. Based on external research from amongst others Asset4 and EIRIS, the fund measures the ESG-content of
all equity and credit portfolios. It is the intention of the fund to expand this ESG-scan to all investment categories. Finally, the fund has signed the UN Principles for Responsible Investments (UNPRI) in 2009. By signing,
the fund underlines the importance of the integration of ESG aspects in the investment policy.
Score: 3 points
Signatory of UN PRI and ESG information acquired from third parties for screening equity portfolio.
4.49.4 Engagement
The periodic scan of the ESG-content of the equity portfolio (based on sources and principles described in
1.1.3) enables the fund to identify laggards. In the eventual case the fund can decide to engage in dialogue
with these companies that lag in ESG-performance. A major role is played by the fund’s asset manager
BlackRock. Companies that – after engagement – don’t improve their behaviour with respect to ESG criteria,
are excluded from investment.
Score: 3 points
Engagement via BlackRock based on UN Global Compact. However, no information provided on ESG
engagement activity.
Philips Pensioenfonds actively exerts its voting rights for Governance issues, based on BlackRock’s responsible
investment policy.
Score: 2 points
Philips Pensioenfonds has a voting policy limited to corporate governance.
Philips Pensioenfonds decided in 2009 to actively start investing in sustainable projects and funds. The first
investments are to be made by the end of November 2009. The fund will have invested approximately 40
million in renewable energy funds. Future sustainable project financing will mostly focus on themes in which
Philips is a major player: energy and health care.
Score: 1 point
Sustainable project financing in development.
Philips Pensioenfonds has its asset management activities outsourced to: Black Rock (Netherlands) B.V.
BlackRock is responsible for the execution of the ESG policy as being formulated by Philips Pensioenfonds.
Additionally, the fund uses explicit ESG criteria for the selection of new external managers, e.g. in the recent
search for managers in indirect real estate.
Score: 3 points
Transparency on outsourcing of asset management to BlackRock, yet no transparency to the public
on agreements regarding SRI policies. Extra point rewarded for using ESG criteria for selection of
new external managers.
Philips Pensioenfonds participates in various ESG working groups within the Dutch pensions sector. Moreover,
the person responsible for ESG issues within the fund, participates in the academic network of the UNPRI, by
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active participation in the European Centre for Corporate Engagement (ECCE) of the University of Maastricht.
Besides, Philips pays attention to ESG in its communication to stakeholders. Finally, Philips Pensioenfonds
organizes an annual meeting during which participants can raise questions, amongst others concerning the
fund’s ESG policy.
Score: 4 points
Active dialogue on SRI with different players in society via ESG-workgroups, the UNPRI network and
the academic institute of ECCE.
In order to inform participants with regard to social responsible investment procedures, Philips Pensioenfonds
pays attention to ESG aspects in the 2008 annual report, within the investment policy, and on the website. A
detailed ESG report can only be drawn after the implementation year 2009 is over.
Score: 2 points
Philips Pensionfund reports only generally about progressions in the fund’s responsible investment
policy and activities. The fund has not yet started reporting on voting, engagement, exclusion and
inclusion instruments, but is planning to do so over the year 2009.
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4.50 Rabobank Pensioenfonds
Rabobank Pensioenfonds is a company pension fund. The fund is responsible for implementing the collective
pension scheme of the Rabobank, intended for employees of Rabobank Netherlands, the local Rabobanks and
several related institutions.
Description
Premium income
 404 million
Active
46 319
Non-contributing
36 832
Pensioners
10 246
Number of employees
 8.7 billion
( 11.6 billion incl. value of strategic hedge)
Equity
 2,26
26 %
Corporate bonds (Fixed income)
 4,43
51 %
Government bonds
-
Loans
-
Real estate:
• direct
• indirect
Participations
 0,52
6%
 0,26
3%
-
Other:
• Alternatives
 0,78
9%
• Liquidity
 0,43
5%
Rabobank Pensioenfonds (the pension fund) has a policy on responsible investment. The pension fund has
adopted the Rabobank Group Statement on Armaments Industry, as the pension fund does not want to be
involved in investments that are related tot to controversial weapons. Next to that, the pension fund has a
corporate governance policy, the Rabobank Pensioenfonds Corporate Governance policy.
To conclude, the pension fund has an engagement strategy. On behalf of the pension fund, Robeco enters into
dialogue with companies. International codes and treaties, like the UN Global Compact are used as a framework when acting as active and involved owner.
The actual responsible investment policy that is publicly available does not consider deliberately chosen social and environmental issues.
Score: 2 points
SRI policy consists various documents describing the instruments it uses, but it does not have a clear
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Rabobank Pensioenfonds has adopted the Rabobank Group Statement on Armaments Industry, available on the
Rabobank website. This means that the pension fund does not want to be involved in any investment that is
related to controversial weapons. The following types of weapons are considered as controversial: cluster
munitions, anti-personnel mines, nuclear, biological, chemical weapons.
There is no list with excluded companies available.
Score: 3 points
Publicly available and clearly defined exclusion policy concerning one issue
In the portfolios managed by Robeco on behalf of the Rabobank Pensioenfonds governance factors are integrated in the investment process. These factors, described in the Rabobank Corporate Governance policy, are
based on international principles of the International Corporate Governance Network (ICGN).
Score: 2 points
A public available document on the criterion of corporate governance
4.50.4 Engagement
Since 2006, Robeco conducts engagement activities on behalf of Pensioenfonds Rabobank. When entering into
dialogue the pension fund aims to stimulate companies to adopt sustainable behaviour and good corporate
governance, expecting this will increase shareholder value.
Robeco reports to the pension fund on a quarterly basis on the progress of the engagement activities. In the
annual report, available on the website, the pension fund reports on its engagements activities. Reported subjects for dialogue in 2008 were the situation in Birma, remuneration structures and participation in the
Carbon Disclosure Project.
Score: 3 points
The pension fund engages companies in dialogue and is clear about the criteria on which priorities
are based and reports on its engagement activities, but has no policy outlining the issues engaged is
based upon.
The Rabobank Pensioenfonds Corporate Governance policy includes a voting policy. This policy does not cover
social and environmental issues. The Rabobank Pensioenfonds , mandated Robeco for its portfolio to vote at
shareholder meetings. The pension fund reports on a quarterly basis on its voting activities. Both the policy
and reports are available at the website of Rabobank Group, not on the pension fund’s website.
The pension fund has not proposed or filed shareholders resolutions on CSR issues at shareholders meetings.
Score: 3 points
The Rabobank Pensioenfonds (the pension fund) is currently investigating if a part of its assets will be allocated to thematic investments, including sustainability related investments.
Score: 1 point
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The Rabobank Pensioenfonds has outsourced its asset management, for which Syntrus Achmea Asset
Management acts as fiduciary manager. Robeco is one of the asset managers that manages the largest part of
the assets of the pension fund and is committed to implement and execute the voting and engagement activities on behalf of the pension fund.
Score: 1 point
external asset managers, nor how they are committed to is responsible investment policy.
Rabobank Pensioenfonds is not involved in an active dialogue with society in general at this moment. The pension fund has an ongoing dialogue with the participants’ councel (Deelnemersraad).
Score: 2 points
The pension fund seeks dialogue with participants
Rabobank Pensioenfonds reports in its annual report on the responsible investing activities, mainly on engagement and voting. Next to that the pension fund discloses on request its responsible investment policy to its
stakeholders (employees, employer and pensioners) via participants’ counsel (Deelnemersraad) or accountability body (Verantwoordingsorgaan).
Score: 2 points
The pension fund partially reports on applied instruments.
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4.51 Pensioenfonds Shell
The Shell pension fund is a corporate pension fund. The Stichting Shell Pensioenfonds provides pension fund
services for the companies of the Royal Dutch Shell Groep who have joined the pension fund.
Description
Premium income
 69
Active
Non-contributing
Pensioners
Number of employees
-
 10 598
11 690
6 701
19 554
Equity
2 728
26 %
Fixed interest
5 600
53 %
Alternatives
1 346
13 %
Other
437
Hedge funds
1 200
11 %
4%
Loans associated with hedge funds
713
-7 %
Shell’s pension fund emphasizes an engagement approach. Its policy has been broadened from focusing on corporate governance to include environmental and social criteria. The UN Global Compact criteria are seen as
the starting point. Companies are not directly excluded based on these principles, but engagement and voting
activities are used when necessary.
Shell strives to, where possible, make use of its voting rights for all the companies included in its investments.
This is done using a specialised service provider that adheres to a clear set of instructions. Shell reports on
its voting activities on a quarterly basis. This policy covers its entire equity and corporate bonds portfolio as
well as a part of its private equity portfolio.
Score: 4 points
Shell has a publicly available policy document that includes environmental, social, and governance
issues. It clarifies the use of instruments and covers multiple investment categories.
4.51.2 Exclusions
Shell does not exclude companies on an a priori basis. Its engagement activities, carried out by Hermes EOS,
has led to the exclusion of a number of companies involved in the production of controversial weapons. This
happened when the activities go against Dutch national or international laws ratified by the Dutch government. Engagement activities are still ongoing with a number of companies.
Score: 3 points
Shell has a publicly available exclusion policy for one issue.
Shell Pensioenfonds is working on incorporating corporate governance and other criteria in its responsible
investment policy. Shell signed up for the UN PRI on October 30, 2008. Shell also subscribes to a database with
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ESG factors that is used for its equity portfolio selection.
Score: 2 points
Shell has signed the UN PRI and states that ESG-criteria are included in its selection of equity
investments.
4.51.4 Engagement
Shell has engagement activities geared towards social responsibility for a number of companies in its equity
portfolio. A dialogue with a company first serves as a fact-finding function, and only in the second place is it
geared towards exerting influence on the company. These activities can lead to exclusion of the company.
Score: 4 points
Shell has formulated an engagement policy outlining its social and environmental issues. This policy
is linked to its exclusion policy but it does not report on its engagement activities.
Shell has a voting policy for the companies in its equity portfolio. It voted at 1 256 general meetings, and
mainly covered corporate governance aspects. Shell finds that topics such as human rights, child labour, climate change and corruption are rarely dealt with at general meetings. If these items are on the agenda, it
will vote on these issues. Shell feels that having a serious dialogue with companies is more suitable for exerting influence.
Score: 3 points
Shell has a voting policy that includes ESG factors but is practically limited to corporate
governance issues.
Shell does not have an explicit sustainable project financing policy, but it does have specific investment projects with high sustainability relevance. These are in the following areas:
-
Renewable energy
-
Microfinance (65 million)
-
Sustainable automotives
The investments currently total 255 million, but Shell is continually looking to expand this portfolio when
suitable investment opportunities arise.
Score: 4 points
Shell invests more than 2% of its capital in sustainable project financing.
Shell outsources a part of its asset management and the largest part of its voting and engagement activities.
For competition reasons, it does not reveal its asset managers. Hermes EOS has been selected to carry out its
responsible investment policy (monitoring, voting, and engagement) in close cooperation with Shell’s ESG
department. Shell’s externally managed equity portfolio is also included in its ESG policy. External asset
managers are also asked to sign Shell’s Statement of General Business Principles.
Score: 2 points
Shell provides some insight into its outsourcing and formalizes external party commitment to its
responsible investment policy. It does not, however, provide a comprehensive overview of its
external asset managers.
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Shell has an active dialogue with its participants and plays an active role in structured discussion sessions concerning CSR issues with other institutional investors (Eumedion).
Score: 3 points
Shell seeks a dialogue with its participants and discusses CSR issues with other institutional investors.
Shell Pensioenfonds uses its website to report on its responsible investment policy and the activities that it
conducts.
Score: 2 points
Shell reports on its responsible investment policy and activities, but does not publish a list of its
holdings.
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References
1 Levensverzekeraars stille kracht in tweede pijler pensioenstelsel, Statistisch Bulletin, De Nederlandsche Bank,
Amsterdam, December 2006; Website Pensioenkijker (www.pensioenkijker.nl), Viewed in October 2009.
2 Statistisch Bulletin, De Nederlandsche Bank, Amsterdam, September 2009.
3 Website Vereniging van Bedrijfstakpensioenfondsen (www.vvb.nl), Viewed in November 2009.
5 Website Stichting voor Ondernemingspensioenfondsen (www.opf.nl), Viewed in November 2009.
7 Website Unie van Beroepspensioenfondsen (www.uvb.nl), Viewed in November 2009.
8 Levensverzekeraars stille kracht in tweede pijler pensioenstelsel, Statistisch Bulletin,
De Nederlandsche Bank, Amsterdam, December 2006.
9 Verzekerd van Cijfers 2009 - Dutch Insurance Industry in Figures, VvV, July 2009.
10 Gebaseerd op data in VVP, 1 Augustus 2007.
12 ING koopt beheerder van pensioenfonds, Het Financieele Dagblad, Amsterdam, 10 January 2007.
13 Barclays verovert Nederland, NPN, 23 Augustus 2007.
14 SER Pensioencommissie, “Eindevaluatie medezeggenschap gepensioneerden”, SER, 19 March 2009.
16 De houdbaarheid van het Nederlandse pensioenstelsel, Occasional Studies Vol. 4 / Nr. 6,
Jan Kakes en Dirk Broeders (red.), De Nederlandsche Bank, Amsterdam, November 2006.
17 Website De Nederlandsche Bank (www.dnb.nl), Viewed in October 2009.
18 Pensioenwet met wijzigingen aangenomen, Staf Depla (www.stafdepla.nl), 27 September 2006.
19 Pensioenfondsen verliezen miljarden door kredietcrisis, Robin van der Kloor, Elsevier, 23 oktober 2008;
Kwartaalcijfers pensioenfondsen: de reserves doen hun werk, Press release Vereniging van Bedrijfstakpensioenfondsen,
Den Haag, 23 October 2008.
20 DNB, “Overzicht Financiële Stabiliteit in Nederland”, DNB, November 2009.
21 Het effect van de herstelplannen van de pensioenfondsen op de groei van Nederlandse economie, Press release DNB,
3 August 2009.
22 Investors and policy-makers discuss financial crisis and responsible investment, Press release UN PRI, Genève,
7 November 2008; Statement on the Global Financial Crisis, Press release International Corporate Governance Network,
10 November 2008.
23 A legal framework for the integration of environmental, social and governance issues into institutional
investment - Report for UNEP-FI, Freshfields Bruckhaus Deringer, November 2005.
24 Pensioenfonds als belegger en aandeelhouder, Mr. A.W. van Leeuwen CPL en Mr. R.E.M. Rinnooy Kan,
Tijdschrift voor de Ondernemingsrechtpraktijk, Den Haag, July 2007.
25 Fiduciary responsibility. Legal and practical aspects of integrating environmental, social and governance issues into
institutional investment. Asset Management Working Group of the UNEP Finance Initiative, July 2009.
26 Fiduciary responsibility. Legal and practical aspects of integrating environmental, social and governance issuesinto
27 Röhrbein, N., “ESG equals fiduciary duty, says IPE survey”, IPE.com, 18 September 2009.
28 Demystifying Responsible Investment Performance - A review of key academic and broker research on ESG factors,
A joint report by The Asset Management Working Group of the United Nations Environment Programme Finance
Initiative and Mercer, October 2007.
29 Shedding light on responsible investment: Approaches, returns and impacts, Mercer, Free version, November 2009.
30 Shedding light on responsible investment: Approaches, returns and impacts, Mercer, Free version, November 2009.
31 Lambrechtsen, F and knoepfel, I., “De lakmoesproef van verantwoord beleggen”, Nederlands Pensioen &
Beleggingsnieuws, No. 29, August/September 2009; Responsible Investor, “The Future of ESG Integration, pre-conference
report”, Responsible Investor/Eurosif, November 2009.
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32 European SRI study 2008, Eurosif, October 2008; Website Eurosif (www.eurosif.org/publications/sri_studies), Viewed in
November 2009
33 FairPensions, “FairPensions, Responsible Pensions? UK Occupational Pension Schemes’ Responsible Investment
Performance”, FairPensions, London, 2009.
34 FairPensions, “Fair Pensions, Investor Responsibility? UK Fund Managers’ Performance and Accountability on
‘Extra Financial’ Risks”, FairPensions, London, 2008.
35 Fiduciary responsibility. Legal and practical aspects of integrating environmental, social and governance issue into
36 Fiduciary responsibility. Legal and practical aspects of integrating environmental, social and governance issues into
37 Marcillac, M. de and Clawson, S., Investment Consultants & Responsible Investment”, Eurosif, December 2009.
38 Ottawa, B., “Innovative SRI products needed, say pension execs”, IPE.com, 18 November 20009.
39 Fiduciary responsibility. Legal and practical aspects of integrating environmental, social and governance
issues into institutional investment. Asset Management Working Group of the UNEP Finance Initiative, July 2009.
40 Miljarden belegd in zwerfkapitaal, Menno Tamminga, NRC Handelsblad, Rotterdam, 30 September 2006.
41 Pensioenfondsen laten het alweer afweten, Persbericht Vereniging van Beleggers voor Duurzame Ontwikkeling (VBDO),
Culemborg, 29 maart 2006.
42 Toekomstagenda milieu: schoon, slim, sterk, Ministerie van VROM, Den Haag, April 2006.
43 De kracht van pensioenfondsen, Prof. Dr. Harry Hummels, Universiteit Maastricht, Maastricht, April 2007.
44 Handleiding Maatschappelijke belangenafweging en transparantie in het beleggingsproces (Handbook Social Appraisal
and Transparency in Investment Processes), Vereniging van Bedrijfstakpensioenfondsen, Den Haag, 16 April 2007;
De gearriveerde toekomst - Nederlandse pensioenfondsen en de praktijk van verantwoord beleggen
(The Future Has Arrived - Dutch Pension Funds and the Practice of Responsible Investment), Vereniging van Bedrijfstakpensioenfondsen / Stichting voor Ondernemingspensioenfondsen / Unie van Beroepspensioenfondsen, Den Haag,
14 November 2007.
45 FNV roept pensioenfondsbestuurders op tot actie tegen Birma, Press release FNV, Amsterdam, 13 November 2007.
46 Website Vereniging van Bedrijfstakpensioenfondsen (www.vvb.nl), Viewed in november 2008;
Website Uitgeverij Van Gorcum (www.vangorcum.nl/NL_toonBoek.asp?PublID=4363), Viewed in November 2008.
47 Website Eerlijke Bankwijzer (www.eerlijkebankwijzer.nl), Viewed in July 2009.
48 Website UNEP Finance Initiative (www.unepfi.org), Viewed in July 2009.
49 Website UN Principles for Responsible Investment (www.unpri.org), Viewed in July 2009.
50 Wheelan, H., “What’s the future for ESG broker research? SRI team cuts and the merger of EAI and
PRI demand clear future research incentives”, Responsible Investor, 22 December 2008.
51 Website Carbon Disclosure Project (www.cdproject.net), Viewed in July 2009.
52 Website IIGCC (www.iigcc.org), Viewed in November 2009; Website IIGCC (www.igcc.org.au), Viewed in November 2009.
53 Website UN Global Compact (www.unglobalcompact.org), Viewed in November 2009.
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www.vbdo.nl / www.goed-geld.nl
The VBDO (Dutch Association of Investors for Sustainable Development) aims at generating a sustainable capital market,
a market that brings together supply and demand, not just based on financial criteria, but also on social and environmental aspects.
VBDO focuses its activities on actors in the Netherlands, within the international context.

Benchmark Responsible Investment by Pension Funds in

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