Denmark’s Forsikring & Pension (F&P) has hit back at criticism aimed at Danish pension companies that highlighted their level of investment in fossil fuel companies.

In a report, Danish non-governmental organisation, Mellemfolkeligt Samvirke, pointed out that Danish pension companies have at least DKK 22bn invested in fossil fuel firms.

However, F&P stated that while there is still a global dependency on fossil fuels for energy, pension companies are investing “billions” in solar, wind and new green technologies.

It added that it believes the pensions industry is contributing significantly to the green transition.

“The Danish pension companies are working to promote the green transition by investing in solar and wind energy all over the world and the next generation of clean technologies such as Power-to-X and green hydrogen,” F&P deputy director, Tom Vile Jensen, commented.

“We have made a commitment to reach DKK 500bn DKK green investments in 2030. These are massive investments that Mellemfolkeligt Samvirke overlooks.”

Mellemfolkeligt Samvirke criticised the industry by referring to the International Energy Agency (IEA), which assessed that new investments from 2022 in new fossil fuel extraction are not compatible with the Paris Agreement.

However, F&P argued that the IEA still expected oil and gas to make up a “significant part” of the world’s energy supply in 2050.

“There is a long way to go from the gradual green transition outlined by the IEA to a total stop for the extraction of oil and gas,” said Jensen.

“The green transition cannot be achieved with a snap of the fingers. But our pension companies have set a clear green direction. They are far along in their work to sell the most climate-damaging and least adaptable companies from and via active ownership move all the other companies in a greener direction.”

F&P highlighted the differing strategies that pension companies were using to move their investments in a greener direction, with some excluding oil and gas production from their portfolios entirely, while others have been in active dialogue with the companies they have investments in to push them towards greener options.

“The pension companies are aware of their role in society and of their responsibilities,” Jensen stated.

“They are active owners who work to promote a climate transition at the companies. But there is not just one path to that goal, but several. And the road there is not always easy either, because there are dilemmas when we have to go through such major transformations - all over the world.”

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