AP1, Stockholm, invested $250 million in Osmosis Investment Management’s new resource efficiency strategy, said Nadine Viel Lamare, head of sustainable value creation at the pension fund.
The 311 billion Swedish kronor ($34.6 billion) pension fund seeded the Osmosis MoRE World Resource Efficiency Fund – Low Volatility, which invests in a minimum variance portfolio of resource-efficient stocks.
Ms. Viel Lamare said in an email that the strategy gives the pension fund low volatility characteristics at a much lower “nature” footprint. The strategy only invests in companies that are efficient in terms of energy use or carbon, water use and waste management. “As traditional low-volatility strategies have a high carbon footprint almost by nature because of a large exposure to utilities, this reduces the carbon footprint of the investment substantially,” she wrote.
The investment was funded from AP1’s internally managed low-volatility portfolio.
The fund launched a new sustainability strategy at the end of 2015, with a special focus on resource efficiency.