All the 49 largest Dutch pension funds explicitly include climate change in their responsible investment (RI) policy to varying degrees, according to a report by the Association of Investors for Sustainable Development (VBDO).

This represents an increase from 80 per cent in 2020 and 94 per cent in 2021.

The number of pension funds including a clear roadmap for implementation in their RI policy rose from 18 per cent in 2021 to 45 per cent this year.

However, 59 per cent do not have a responsible tax policy in place beyond adherence to the relevant OECD guidelines.

While 100 per cent of the funds publicly disclose their RI-related climate change policy in some capacity, less than half (46 per cent) report on climate-related performance.

More than a third (35 per cent) of Dutch pension funds believe that biodiversity is the ESG topic that most deserves greater attention.

The VBDO noted that several pension funds indicated that biodiversity-related active ownership activities, such as engagement dialogues, would increase in the coming year.

The number of pension funds that apply at least two exclusion criteria to government bond investments has more than doubled to 51 per cent compared to last year (24 per cent).

Meanwhile, 98 per cent apply at least two exclusion criteria for publicly listed equity, up from 90 per cent.

Nine in 10 (90 per cent) pension funds that invest in publicly listed equity engage with companies on predefined ESG themes, up from 86 per cent in 2021 and 74 per cent in 2020.

More than eight in 10 (84 per cent) make their results of engagement policy available, up from 66 per cent last year.

Reporting on impact investing has also improved, from 70 per cent to 80 per cent of the funds surveyed, although only 12 per cent report on the achieved impact.

“We are very proud of the results that the pension funds have shown in recent years,” said Pension Federation chairman, Ger Jaarsma.

“As VBDO noted last year, responsible investment has become mainstream.

“However, there are still plenty of challenges, especially in the current uncertain time in which climate goals may come under pressure due to the energy crisis. It is important to keep long-term goals in mind.”

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