Sustainable and responsible investing

A good pension in a livable world

We as a pension fund also assume our social responsibility. The Board of PDN considers sustainability to be a major aspect of the investment philosophy and a full component of PDN's investment principles. PDN is the company fund of DSM Nederland and its affiliated companies. We believe it is important to have a sustainability policy that is in line with DSM’s standards and values.

In this article, you can read in brief what PDN does with regard to sustainability.

We see it as our main task to continue to provide a good pension, now and later, which is why we invest our members' pension contributions in a responsible way. Numerous scientific studies have strengthened our belief that sustainability does not need to be at the expense of return on investments. On the contrary, we can take better-informed investment decisions by incorporating information about people, the environment, and good corporate governance in our policy. Certainly because we are investing for the long term.

Would you like to receive detailed information about our Sustainability Policy? Then click here.Duurzaam beleggen_EN.jpg (21 KB)






But how do you do that? Socially responsible or sustainable investing?

Duurzaam beleggen_2.jpg (5 KB)To start, a general short video (click on image) on 'Duurzaam beleggen: het nieuwe normaal' (Sustainable Investing: the new normal).


In addition, at the end of 2018, PDN and other pension funds signed the Covenant on International Socially Responsible Investment by Pension Funds. The signatories of this Covenant have opted for an approach that takes the OECD Guidelines for Multinational Enterprises and the UN Guiding Principles on Business and Human Rights as the basis for identifying, prioritizing, and addressing Environmental, Social, and Governance (ESG) risks.

In committing to these guidelines and principles, we aim to focus on specific societal developments that are important for our members and have been identified as high risk for the investment portfolio.

Our sustainability policy currently focuses specifically on three themes: health and welfare, climate and energy, and raw materials and circularity.
SDGs.png (56 KB)These themes are linked to four of the UN's Sustainable Development Goals (SDGs).
In particular, we focus on:
SDG 3 – good health and welfare;
SDG 7 – affordable and sustainable energy;
SDG 12 – responsible consumption and production; and
SDG 13 – climate action.

These goals are seamlessly linked to DSM's focus areas.

Pillars as a basis

PDN has further translated its strategic vision on sustainability into policy areas. Our policy for socially responsible and sustainable investment is therefore based on the following pillars:

Exclusion
PDN excludes some companies or countries from investment. The basis for excluding companies and countries is that they engage in activities that the United Nations, the European Union, or the Dutch government deem unacceptable.

Target Investments
With target investments (Impact investments), PDN is investing in investment opportunities that can help resolve social and environmental problems, such as poverty in developing countries or climate change. As of 2020, we link a small proportion of invested assets to the 17 UN Sustainable Development Goals (SDGs). As part of this, our focus is on three themes: (I) 'health and welfare', (II) 'climate and energy', and (III) 'raw materials and circularity'.

Transparency
A third part of PDN’s investment policy for socially responsible investing is that the fund is transparent about where it invests its money (it ensures this is visible), which voting policy it introduces in the context of corporate governance, and provides an explanation in the form of a sustainability report. Visit our website Investment policy at PDN for more information.

Engagement
The term ‘Engagement’ refers to entering into a dialogue with companies that do not comply with social norms and values. Our objective here is to encourage companies to effect positive developments in terms of social issues and sustainability. 

Corporate Governance and voting guidelines
Good corporate governance is about transparent and efficient supervision of a company's board. The basic principle is that the Board and the Supervisory Board are accountable for their corporate policy and the monitoring exercised by the Supervisory Board. By subsequently making our voice heard at shareholder meetings, we can influence the policy and quality of the boards of those companies in which PDN holds shares. We have active voting hosted by BMO Global Asset Management. We endorse their guidelines and they respond to our requests. More information on the voting guidelines via BMO Global Asset Management can be found here. To see how PDN voted, click here.

ESG integration and lowering of CO2 emissions
Companies that have an excessive impact on the environment or do not handle certain social factors in an acceptable way (such as with employees and other stakeholders in the company) are not an ESG investment according to PDN. We are convinced that such companies have no basis for existence in the future and are therefore not good investments for the fund.

The PDN brochure Socially Responsible Investment and Corporate Governance provides more information on this subject.


Reporting

PDN publishes an annual sustainability report to ensure transparency about the sustainability policy and its implementation. In this report, we indicate how we handled sustainability in that year and which results were achieved with respect to sustainability.

In the context of transparency about where PDN invests, we publish an annual overview of the total investment portfolio on our website. For more information visit our website Investment policy at PDN. We also report the results of Vote Summary Report at shareholders’ meetings on our website. The PDN Magazine and the website also regularly feature items on PDN’s sustainability policy.