Finnish earnings-related pension provider Ilmarinen has exceeded all of its climate targets for 2021–2025 ahead of schedule, as it unveiled a new, more ambitious climate plan for 2026–2030.

According to its latest climate report, the pension provider delivered stronger-than-expected reductions in portfolio emissions, while increasing investments in climate solutions at a faster pace than anticipated.

Ilmarinen claimed its second climate roadmap (2021–2025) marked a “clear period of performance”, building on earlier work following the Paris Agreement to integrate climate considerations into investment decision-making and risk management.

Ilmarinen director of responsible investment, Karoliina Lindroos, highlighted the scale of progress in listed investments.

“The target of reducing the weighted carbon intensity by 30 per cent from the 2020 level by the end of 2025 was clearly exceeded, with a decrease of 68 per cent," she said.

“This shows that climate goals have been an integral part of investment decisions and risk management.”

Meanwhile, the report showed that Ilmarinen increased allocations to climate solutions and systematically exited investments in the most polluting fossil fuel sources, including coal and oil sands.

Climate progress was also evident in Ilmarinen’s real estate portfolio, where emissions from Finnish properties decreased by 72 per cent, compared with the 2018–2020 baseline, driven by improvements in energy efficiency and a transition to CO₂-free energy sources.

In addition, the carbon intensity of construction activities fell by 36 per cent compared with 2020–2022 levels, supported by low-carbon material choices and improved project planning.

Lindroos also noted that Ilmarinen had expanded its environmental approach beyond emissions reduction.

“Low-carbon solutions in construction reduced carbon intensity, and in domestic properties, we conducted nature surveys in those sites where measures to improve the state of nature can be implemented,” she added.

Looking ahead, the provider confirmed that its board had now approved a new set of science-based climate targets, which would guide its next phase of work through to 2030.

The updated plan tightens emission reduction targets and extends climate objectives across the entire investment portfolio, as well as Ilmarinen’s own operations.

Under the new roadmap, Ilmarinen aims to reduce the weighted carbon intensity of listed equity and fixed income investments by 35 per cent and financed emissions by 25 per cent by 2030.

It also plans to increase investments in climate solutions to 13 per cent of portfolio value and raise the share of holdings with science-based targets to 62 per cent.

In real estate, the provider is targeting a 44 per cent reduction in emissions from property use and a 20 per cent reduction in construction-related emissions, alongside a goal to recycle at least 90 per cent of construction waste on domestic sites.

For the first time, Ilmarinen’s own operations will also be included in its climate targets, with a 25 per cent emissions reduction goal by 2030.

Lindroos concluded that the provider would continue its "determined work" towards a low-carbon economy while supporting the solutions needed to mitigate climate change.

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