ABP

"Inclusion means that we evaluate any companies that we caninvest in through shares or bonds (the investment universe)according to return, risk, cost and the degree to which theyoperate sustainably and responsibly. If a company meets ourcriteria and it scores above average in the industry in question, we call that company a ’leader’. We like to invest in suchcompanies for our pension fund clients. In addition, there are companies that score high in terms ofreturn, risk and cost, but lag behind in terms of sustainabilityand governance. We may invest in such ‘laggards’, but only if weexpect we can inspire them to improve. We then call thecompany a ‘potential improver’...The criteria we have developed to evaluate companies are basedon the principles of the UN Global Compact in terms of humanrights, labor rights, the environment and business ethics. Wecheck if companies have a good policy in these areas. We alsocheck if they generally honor agreements or if any incidents areknown. Below are some examples of themes we look at...We use separate criteria for every industry. They take intoaccount the specific risks that exist in that sector. We also lookat the countries and regions where the companies are active.We expect companies that are active in areas with an increasedrisk of human rights violations to be able to detect those risksand limit them. This means that they must at least have anappropriate human rights policy."

"Inclusion means that we evaluate any companies that we can invest in through shares or bonds (the investment universe)according to return, risk, cost and the degree to which they operate sustainably and responsibly. If a company meets ourcriteria and it scores above average in the industry in question,we call that company a ’leader’. We like to invest in such companies for our pension fund clients. In addition, there are companies that score high in terms of return, risk and cost, but lag behind in terms of sustainability and governance. We may invest in such ‘laggards’, but only if weexpect we can inspire them to improve. We then call the company a ‘potential improver’."

"Inclusion is never ‘done’. Companies change and new onesemerge. Just in 2019, over 2,000 new companies joined ourinvestment universe. These also had to be evaluated. During theyear, they received a provisional (pro forma) classification asleader or laggard. In January 2020, these classifications wereofficially set (‘frozen’). The figures below show the situation asof the end of 2019. This explains the relatively large number ofpro forma classifications. As of the end of 2019, we sold virtually all officially classifiedlaggards, except for 16 (0.4 % of the number of companies inthe portfolio). We also want to sell these, but that was not yetpossible at the end of 2019, due to, for example, traderestrictions. The figure below shows the classification of the investmentportfolio and that of the investment universe as of the end of2019"