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Active ownership is paving the way for positive change

As an investor, Danske Bank is able to shape the companies of the future and can propel society in a more responsible and sustainable direction. We are committed to being an active owner and to helping companies to manage and improve sustainability performance and reduce sustainability risks. Not only does this approach support the companies’ long-term value creation and contribute to creating attractive returns for customers, but it also contributes to the positive development of society.

We exercise active ownership in three ways

Engage in dialogue with the management of companies

Vote at the general meetings of companies

Collaborate with other investors and organisations

Creating value for investments, companies and society

Our investment teams engage in direct dialogue with companies with the aim of influencing and supporting the companies’ behaviour, strategies and performance related to business-critical sustainability aspects. Our teams have in-depth knowledge of the companies in which they invest, and they use that knowledge to influence companies to reduce their CO2 emissions, to create better board-membership diversity, to strengthen waste management processes, to reduce water pollution, to create safe and healthy working conditions for employees, to live up to human rights, and to fight corruption. This helps us to reduce the sustainability risks of investments, and it also helps to create more responsible companies and sustainable societies.

At the same time, the dialogue provides our investment teams with greater insight into companies – insights that the teams then use to make better-informed investment decisions to benefit the potential returns for our customers.

You can read more about our integration of sustainability risk in our Responsible Investment Policy

Investment teams use dialogue to:

  • discuss and reduce company-specific sustainability risks, thereby protecting customer investments
  • influence companies to address sustainability challenges and address problematic issues
  • influence companies to improve reporting of business-critical ESG issues
  • gain a greater understanding and knowledge of the companies’ business models, strategies and growth opportunities
  • support the companies’ long-term, responsible development and contribute to positive societal development

Taking responsibility

We believe that we can most effectively contribute to positive change by remaining invested in companies thus being a responsible investors. For this reason, we do not divest companies as out first option and turn our backs on problems, challenges or dilemmas. Instead, we engage in constructive dialogue to exert pressure and help companies change their behaviour and resolve challenging issues and problematic practices. We believe that this is the way to create real change and to ensure healthy, responsible companies.

Exclusion as a last resort

It may take time for companies to improve – and we support them in the long term through active dialogue. If we assess that a company is not sufficiently improving over time, and if we see no further means of exerting pressure on that company, we may divest the investment or introduce an investment restriction for that specific company.

Protects investors through dialogue

To protect investors, senior portfolio manager Cecilie Hoffmeyer puts pressure on private equity funds to stop them from selling assets from companies that they have acquired. Assets must remain in the company, otherwise there may be negative consequences for the company’s financial stability.

Read how Cecilie puts pressure on private equity funds to protect companies and customers’ investments on page 12.

Moving oil companies in a green direction

Investors have a great deal of opportunities to influence oil companies to take part in the green transition. Oil companies do not turn green overnight, but from senior portfolio manager Kasper From Larsen’s perspective, it is about taking responsibility and using his influence as an investor to help drive the transformation.

Read how Kasper contributes to creating more climate-friendly oil companies on page 28

Using our voting rights at general meetings

As an investor, Danske Bank uses its voting rights to voice our opinion at the general meetings of companies we invest in. We vote either for or against proposals with the purpose of ensuring that companies are able to create long-term value and mitigate sustainability risks and minimise negative impact on society.

On our voting platform, we regularly disclose how we vote on proposals at general meetings. See our voting platform here

Voting guidelines

Our voting guidelines sets out a number of principles that guide how we vote on proposals at general meetings. The overall guiding principle is to improve and protect customer investments. The guidelines address, for example, how we vote on financial matters, the remuneration of the board of directors, the capital structure and shareholders’ rights. There are also a number of guiding principles for how we vote on proposals relating to ESG aspects with the objective to reduce sustainability risks and minimise the companies’ negative impact on sustainability issues in society. Such ESG aspects include CO2 emissions, energy efficiency, gender diversity, use of renewable energy, biodiversity, water and sanitation, employee conditions and human rights, child labour, and anti-corruption.

Reasonable remuneration packages in the pharmaceutical industry

In order to attract the right competencies and talent, it is important to have a suitable level of remuneration for members of the boards of pharmaceutical companies. However, it is important that the board members do not have undue financial interest in the company’s performance. Chief portfolio manager Jesper Neergaard Poll uses the general meeting to ensure reasonable remuneration packages for board members.

Read the story on page 24

Making a difference through collaboration

Danske Bank is a member of a number of investor organisations and investor initiatives, and we collaborate with a range of other relevant stakeholders. By doing this, we aim to contribute to the development of responsible investments and to promote transparency and sustainability standards in companies and in the financial markets. 

Increased transparency

Working with responsible investments requires quality ESG information about companies. Through partnerships and direct dialogue and discussion, we encourage companies, regulators and ESG data providers to continuously improve and standardise reporting on ESG aspects and sustainability risks. This enables investors to include ESG factors and sustainability risks in the investment process to a greater extent. This will also support the ambition that investment capital should be increasingly placed in investments that work toward a more sustainable society.

Strengthening our options to influence

We work with other investors and stakeholders to exert active ownership and engage in joint dialogue with companies to contribute to positive change. By working together, we and the investment industry gain a stronger voice, and this enables us to put additional pressure on companies to improve or solve ESG challenges and to have a responsible business model.

Our collaborations

  • The organisation encourages companies and cities to publish details of their climate impact, with the objective of reducing greenhouse gas emissions from companies and mitigating the consequences of climate change. By collecting and sharing information on greenhouse gas emissions and climate strategies, the organisation enables investors to mitigate climate-related risks in investments. 

    Read more about the organisation here

  • Climate Action 100+ is one of the largest investor-led initiative that engages with companies on the climate agenda. Together with more than 500 global investors, Danske Bank is in dialogue with the companies that have the highest levels of CO2 emissions worldwide. The purpose of this is to make these companies reduce and curb their climate impact in accordance with the climate objectives of the Paris Agreement and to improve their reporting on CO2 emissions. The initiative targets companies in the oil and gas industries, the supply and mining sectors, the transportation sector, industrial companies and the consumer sector.

    Read about the initiative here

  • As part of our ambition to support the green transition, Danske Bank is a signatory to the Montreal Carbon Pledge. This means that we report on the carbon footprint of ESG investment products.

  • Danske Bank is a member of the Partnership for Carbon Accounting Financials, which is a global partnership for financial institutions. The purpose of the collaboration is to develop and implement a standard for analysing and reporting greenhouse gas emissions from investments and lending.

    Read more about the partnership here

  • The UN Principles for Responsible Investment (UN PRI) is a UN-supported member organisation that works to understand how ESG factors affect investment. The organisation supports members in integrating sustainability aspects into their investments and active ownership activities. Danske Bank has been a member of the UN PRI since 2010, and we have signed up to the organisation’s six principles for responsible investments, which form the foundation of our work in the field of responsible investment. We report annually to the UN PRI on our processes and our progress in implementing the six principles into our responsible investment work.

    View our latest ratings here
    Read about the UN PRI here

  • The institutional Investors Group on Climate Change (IIGCC) focuses on reducing climate change. The alliance has more than 250 members, and its mission is to mobilise capital for the green transition and to contribute to creating a robust society that can manage climate change. This is achieved through cooperating with companies, politicians, investors and other stakeholders. The IIGCC contributes to creating regulation, investment practices and company strategies that address the long-term risks and opportunities associated with climate change.

    Read more about the IIGCC here

  • Danske Bank has partnered with the Sustainability Accounting Standards Board (SASB) to leverage their knowledge of and competencies in analysing business-critical ESG factors. The SASB’s ambition is to help companies identify, manage and report on the ESG factors that are most important to investors. We encourage companies to use the SASB’s reporting framework because this will enable investors to compare companies’ ESG performance against each other. Being able to make such comparisons increases transparency about key ESG issues, which strengthens the ability of investors to manage sustainability risks and to include ESG criteria in investment decisions.

    Read more about the SASB here
    Read how we use the SASB’s methodology in our ESG analytical tool mDASH@ here

  • Danske Bank is a member of the Danish, Norwegian, Swedish and Finnish branches of the Sustainable Investment Forum (SIF). The mission of the SIF is to promote knowledge and the exchange of responsible-investment experience and to contribute with analysis and data in this field.

  • Danske Bank is a member of the Task Force on Climate-related Financial Disclosures (TCFD), which develops a voluntary framework for companies to report their climate-related financial risks to investors, lenders and other stakeholders. We believe that the TCFD’s recommendations help companies to understand the information needs of investors so that they can respond to potential climate-related financial risks. At the same time, the initiative encourages companies to report climate-related issues that align with the needs of investors. We encourage companies to report on climate-related risks in accordance with the TCFD recommendations, and we believe this will help companies to future-proof their businesses.

    Read more about the TCFD here