Danish pension providers have invested DKK 264bn in growth companies, including DKK 25.5bn in Denmark, according to new analysis from Insurance and Pension Denmark (I&P Denmark).

The association said the country's pension assets are already playing a significant role in supporting the development of new growth companies, but argued that the potential for further investment could be unlocked through stronger policy support.

I&P Denmark chief executive, Kent Damsgaard, argued the recent election campaign focused too little on improving conditions for growth and investment, despite growing economic uncertainty in Europe.

He stated: “The war in Iran is the latest blow to both the Danish and European economies. If Denmark is to maintain strong businesses and attractive jobs in the future, it will require increased investment in growth, innovation and new business models.

“Denmark has a major strength in its pension savings, which are the largest in the world relative to GDP. With the right political framework for growth, the potential is even greater, and we encourage politicians to take this into account during the current government formation negotiations.”

According to its analysis, 10 per cent of pension sector growth investments are allocated to Denmark, while a further 31 per cent are invested elsewhere in Europe. The investments span a range of sectors, including defence, energy and technology.

I&P Denmark said Europe and Denmark have fallen behind countries such as the United States in terms of growth and productivity in recent years, affecting the attractiveness of investment opportunities.

“There must be confidence that a company based in Denmark or Europe can generate returns. Without that, sustainable long-term growth will not materialise,” Damsgaard said.

Therefore, the association called for a series of measures to boost investment, including stronger collaboration between public and private capital, particularly in the growth segment, the launch of Denmark's planned defence fund and reduced bureaucracy for investments in growth companies.

It also urged policymakers to address the double taxation of Danish pension providers' investments in Europe, arguing that the current framework weakens incentives to invest in European growth businesses.

I&P Denmark suggested that a future government should establish a partnership on investment and competitiveness, bringing together pension providers, family offices, commercial foundations, businesses and public sector stakeholders to strengthen long-term investment in growth companies.

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