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New report: Our approach to sustainable investment

Danske Bank launched a new strategy for sustainable investment in 2018, and since then we have strengthened our ability to integrate sustainability when investing on behalf of customers. The new report, ‘Our Sustainable Investment Journey 2019’, shows how investment teams integrate sustainability. 

Sustainable investment is an integral part of our goal to deliver attractive long-term returns to customers while influencing companies and contributing positively to the societies that we are part of. 

Sustainable investment is about making sound investments. Sustainability is therefore an integral part of our investment teams’ investment processes, where they consider environmental, social and corporate governance (ESG) matters alongside the financial aspects. This helps them make better-informed investment decisions and create long-term value for our customers. We call our approach ‘ESG Inside’ to highlight that ESG is an integral part of our investment processes, products and advisory.

ESG integration approach depends on strategy and asset class
Integrating ESG in to the investment process is not a one-size-fits-all approach. It differs depending on the investment strategy and asset class. Investment teams and portfolio managers are responsible for addressing and managing ESG issues that pose a risk or an opportunity as they may affect their investments and thereby the ability to deliver returns to customers.

The new annual report highlights our sustainable investment approach and investment teams share how they integrate sustainability across investment strategies and asset classes.

Portfolio manager Andreas Dankel about sustainability

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Strengthened foundation

Our 2020 goal is that all our investment teams should be able to tell how they integrate ESG. Today, 87% integrate ESG, which is positive; however, a majority do not consider their approach to be strong and systematic. And that is why we are building a stronger foundation that will enable our investment teams to deploy a strong and systematic ESG integration process.

We kicked off a number of initiatives in 2018 that we will continue to improve and expand in the coming years. For instance, we developed a tool called mDASH – our ESG materiality dashboard – which helps investment teams identify ESG issues that are material for each sector and company. We have rolled out an ESG educational and skill-building programme, and we have strengthened our data platform by using multiple sources to help us find high-quality ESG data. Last, but not least, we have a Nordic team of ESG researchers and specialists on site across our Nordic markets to support local investment teams. 

New ESG materiality dashboard with an overview of ESG issues

ESG education & training programmes

A strengthened ESG data platform with high quality data

Nordic team of ESG specialists supporting local markets

Taking responsibility and influencing companies

We use our power as an investor to influence the companies in which we invest. It is through our portfolio-manager-driven dialogue that we can address material ESG issues and contribute to change and improvements.

I believe it is more responsible to stay invested in companies and address concerns, dilemmas, risks or problems when they arise rather than divesting and leaving the problems to be solved by someone else. Through dialogue, I can influence companies to integrate sustainability into their business model and manage the ESG risks and opportunities facing them. This is how I as an investor can support the growth and development of companies and contribute to a positive societal impact.

Ivan Larsen 

Chief Portfolio Manager, Danske Bank