AP4, Stockholm, will seed an emerging markets equity fund that excludes companies with high greenhouse gas emissions and companies with extensive reserves of fossil fuels, according to a news release from the 241 billion Swedish kronor ($38 billion) pension fund.
The equity fund has been created in partnership with Northern Trust and positions “AP4's global equity portfolio to benefit from the transition to a low-carbon economy,” according to the news release.
“With few exceptions, carbon dioxide is now widely recognized to have a negative impact on the climate. We believe that these companies will be valued differently in the future and that greenhouse gas emissions will be associated with higher costs in the long term. Hopefully, this will also increase the pressure on companies to lower their carbon dioxide emissions,” said Mats Andersson, CEO of AP4, in the release.
The Northern Trust Emerging Markets Custom Low Carbon Dioxide Equity Index Fund is a new subfund of an existing Irish UTICS fund called Northern Trust Investment Funds and will be open to other investors, confirmed company spokesman John O'Connell.
Phone calls to Mr. Andersson; Pia Axelsson, AP4's manager, corporate governance; and Bjorn Kvarnskog, head of global equities at AP4, were not returned by press time.
