Active ownership is an integral part of our investment process here at Danske Bank Asset Management. We engage in dialogue with companies and vote at general meetings to influence their behaviour, support sustainable practices and manage sustainability risks.
“We want to protect our customers’ interests and create attractive returns while also being aware of the impact our investments have on society,” says Oshni Arachchi, Head of Active Ownership at Danske Bank Asset Management.
During the first half of 2023, three topics in particular dominated our dialogue with companies and general meetings:
> We have called for a reduction in the use of plastic
Plastic pollution poses a significant threat to the environment, biodiversity and the climate. At companies such as Amazon, Burger King, Pizza Hut and KFC, we stood behind proposals that sought the introduction of reporting on plastic consumption and establishment of targets to curtail plastic use and production. We considered that both of these measures would benefit the environment and our clients' investments.
“We expect that there will be stricter legislation for plastic consumption in the coming years and this can create both environmental and financial opportunities for the companies in the long term. It is therefore important that the companies prepare for these changes already now,” says Oshni Arachchi.
Oshni Arachchi, Head of Active Ownership at Danske Bank Asset Management.
> We have pushed for climate plans at major US banks
During this year's general meetings, we supported proposals at major American banks, such as JPMorgan Chase and Goldman Sachs, that sought the development of plans for phasing out loans to new fossil fuel projects and creating more detailed climate action plans,
“As US banks have historically shown slow progress on climate issues, it is crucial that they begin setting ambitious goals and defining concrete action plans to demonstrate how they will support the green transition. While the proposals were not adopted, support for climate-related proposals generally increased this year compared to the past, indicating a positive trend,” says Oshni Arachchi.
> We have urged big energy to speed up the green transition
We have placed significant focus on the energy sector, engaging in dialogue and voting at the annual general meetings of major global energy corporations, including Total, Shell, BP and Chevron.
The energy crisis and the conflict in Ukraine have boosted fossil fuel production to compensate for the loss of Russian oil and gas and to stabilise the economy. Furthermore, surging oil prices have incentivised investments in oil over renewable energy.
“While we recognise the need to reduce reliance on Russian oil, we must nonetheless continue to make progress in our efforts to address climate change. Our message to energy companies has been clear: in line with the recommendations of the International Energy Agency, halt the development of new oil projects and increase investments in renewable energy to ensure a viable future business,” says Oshni Arachchi.
Our active ownership activities in numbers for the first half of 2023
2 900+ total meetings voted
37 000+ total proposals voted
469 Environmental and social proposals voted