Green transition

Green transition

We focus on the green transition

Temperature records, extreme weather phenomena and the large loss of nature all point in the same direction: The planet is under pressure. As a pension company, we have a long-term investment horizon and work first and foremost to achieve the best possible returns for our customers. However, we are also concerned about the challenges that have negative consequences for society and the economy and affect our ability to deliver competitive, risk-adjusted returns on our customers’ savings.

Therefore, efforts to combat climate change, the loss of biodiversity and instability in society are important to us. We put our ambitions into action, for example by investing in renewable energy and infrastructure and by actively seeking to influence the companies in which we invest.

It is our fundamental responsibility to contribute to our customers’ financial security through competitive, risk-adjusted returns, while also working to minimise investment risks and help limit the financial and societal risks associated with climate change and the biodiversity crisis for people, animals and nature.

Ambitions

 

Net-zero CO2 emissions from total investments by 2050. 60 % reduction for listed equities and corporate bonds 20301.

51 % of PFA’s equities, corporate bonds and a subset of the alternative investments must have externally validated climate targets under the Science Based Targets initiative no later than 20302.

53 % reduction in CO2 emissions from PFA’s properties (kg CO2e per square metre) no later than 20303.

At least 150 companies will have been in ownership dialogue with PFA on green transition, climate or nature by 2030.

 

1 The ambition has been set in accordance with the recommendations of the Net-Zero Asset Owner Alliance (NZAOA) with 2019 as the baseline year for listed equities and corporate bonds, measured by Scope 1 and 2 emissions.
2 Measured as a proportion of the total value of the covered asset classes.
3Baseline year 2023, covering properties in operation.

Selected initiatives

The green transition requires capital. At the end of 2025, PFA had invested just over DKK 100 billion in a wide range of activities which, according to various recognised methods, including the EU Taxonomy and ICMA’s Green Bond Principles, are considered to support the green transition. This includes, among other things, offshore wind farms, solar cells and innovative construction such as the TRÆ project in Aarhus. We also invest in green bonds, forestry and companies that work with recycling and circular economy. On top of that, we work in a targeted way to reduce the environmental and climate footprint in many of the investments that cannot in themselves be classified as green. Regardless of the nature of the investments, the primary purpose of our investments is to contribute to our customers’ financial security by delivering competitive risk-adjusted returns over time.

Link to film (in Danish) about the TRÆ project

 

At PFA, we make use of our ownership stakes, network and expertise to encourage the companies in which we invest to adopt business models that take into account good corporate governance, climate impact and the wider society. This is done through dialogue, active participation and voting at the general meetings of some of the world’s largest companies. With more than DKK 800 billion under management and strong partnerships with like-minded investors, we are actively engaged in accelerating the green transition. Our engagement takes place, among other things, through two international investor initiatives, Climate Action 100+ and Nature Action 100.

We do not rule out divestment and exclusions if the possibilities for dialogue have been exhausted and the investment risks are considered too high, or if the companies breach our Policy for Responsible Investments and Active Ownership. However, transforming the most CO2-emitting companies is absolutely crucial if, as a society, we are to succeed with the green transition and limit temperature increases in line with the Paris Agreement.
 
Read more about:
At PFA we work to reduce the carbon footprint of our investments and have set clear targets for the pace of reduction.  We have both reduction targets, which are set in accordance with the Net-Zero Asset Owner Alliance, and climate targets, which are validated and approved by the Science Based Targets initiative. This means that our actions follow clear recommendations from external parties.

Our primary responsibility is to achieve the best possible returns for our customers. However, this is compatible with also working to reduce greenhouse gas emissions, which represent a significant sustainability risk to our investments. 
So far, the reduction in CO2 emissions has largely been achieved by adjusting and optimising our portfolio, for example through divestment of companies where we have assessed that our active ownership efforts could not move the companies. Divestment can reduce the carbon footprint of an individual portfolio, but it does not solve global challenges. The same applies if we only invest in companies whose activities result in low CO2 emissions. Companies in which PFA invests must reduce greenhouse gas emissions across sectors in order for it to have an impact on the real economy and the world around us. Therefore, at PFA, we work purposefully to encourage the companies in which we invest to commit to the transition and ensure real progress, while reducing emissions from our property portfolio in line with our SBTi-validated climate targets. 
 
Read more about:
 
PFA takes the global loss of biodiversity and ecosystems seriously. We want to secure good returns for our customers while also taking the protection of nature and biodiversity into account in our investments. Our clear starting point is that failing to take biodiversity into account may harm companies’ long-term value creation. For this and other reasons, we use nature-related data points in our investment processes, incorporate nature and circularity considerations into our direct investments, exercise active ownership targeting selected sectors and set the highest expectations for the companies that are most dependent on and have the greatest impact on biodiversity and ecosystems.
Read more about:
 
We believe that companies which show consideration for society as a whole and help find solutions to some of the world’s problems will perform better than companies that do the opposite. Therefore, we regularly screen the companies we invest in, for example for breaches of international norms, and we carry out a number of analyses based on climate and nature as well as the companies’ work with governance and social conditions and their compliance with international laws and conventions. The better we become at taking these factors – also called ESG factors – into account in our investments, the better our opportunities to create positive long-term returns for our customers.
Read more about:
 
At the same time as PFA focuses on the green transition and ESG factors in our general pension products in PFA Plus, our customers with market rate products also have the option of placing their savings in PFA Climate Plus. Here, the equity investments have a carbon footprint at least 60 per cent lower than that of the global equity index, and certain sectors, such as oil, coal, gas and defence, are excluded entirely. In 2025, we achieved net-zero CO2 emissions from PFA Climate Plus and aim to achieve net-negative CO2 emissions by 2030. In PFA Climate Plus, we also focus on ensuring that investments in the green transition go hand in hand with financial security and attractive long-term returns, while recognising that the narrower investment universe focused on the green transition may result in greater fluctuations in returns when, for example, geopolitical developments occur or interest rates rise. At the same level of investment risk, the expected long-term return on PFA Climate Plus may be slightly lower than that on PFA Plus. In practice, however, returns may be higher, the same or lower.
Read more about:
 

Collaboration and partnerships

PFA prioritises cooperating with other investors and stakeholders on targets and actions within responsible investments and active ownership. Additionally, we participate in councils and networks to exchange knowledge on corporate responsibility and to place greater focus on the green transition. In addition to informal dialogue with various actors and stakeholders, we are, among other things, involved in the following:

 

  • Participates in Climate Action 100+
  • Participates in Nature Action 100
  • Participates in the financial sector’s climate partnership
  • Member of the Institutional Investors Group on Climate Change (IIGCC)
  • Member of the United Nations-convened Net-Zero Asset Owner Alliance (NZ AOA)
  • Approved targets under the Science Based Targets initiative (SBTi)
  • Member of Nordic Engagement Cooperation
  • Signatory to the Principles for Responsible Investment (PRI)
 
  • Support to the Net Zero Engagement Initiative
  • Signatory to the investor statement “Moving together on nature”
  • Member of Dansif
  • Member of the Carbon Disclosure Project – CDP 
  • Member of Ocean Plastic Forum
  • Member of the partnership for increased biodiversity in Copenhagen
  • Member of the UN Global Compact
  • Joined Reduction Roadmap
  • Partner to State of Green

Other relevant information

Our initiatives for Financial Security
Our approach to responsible investments
Our approach to active ownership
Our approach to exclusion