The Swedish AP Funds’ Council on Ethics has detailed its work in 2021, in which it said it was “very active”.

Publishing its annual report, the Council on Ethics revealed that eight proactive projects have been conducted to improve sustainability in difficult and vulnerable sectors and 85 reactive company dialogues have been conducted to enable companies to address serious incidents and prevent future incidents.

The report also describes the joint advocacy work of the AP Funds regarding foreign companies. Collaboration between the AP Funds creates greater weight in the dialogue with the companies and contributes to better investments and sustainable returns in the AP Funds’ portfolios.

Commenting, AP Funds’ Council on Ethics chairman, Peter Lundkvist, said: “It’s important for the council to be able to present even more transparent reporting on our dialogue work with companies and sectors. The council’s work is long-term and the impact of advocacy can be difficult to quantify. However, thanks to intensive internal work, we’ve further developed our reporting on the work the council is doing to improve sustainability work in companies."

Eight proactive projects in different areas are being run, including one on mining companies, where the council has, over the course of three years, had a leading role in creating a global and open database. A first global standard has been established for mining tailing dams, and an institute was established in 2021 to ensure that companies adhere to the standard.

The work with tech giants on human rights also made progress during the year, with new milestones achieved. In addition, important advocacy projects are under way, including work on anti-corruption and climate change, with a focus on the transition in emissions-intensive sectors.

The council’s reactive work aims to influence companies to manage and address accidents and incidents if they occur. Around 3,200 holdings in the AP funds’ portfolios have been reviewed. At year-end 2021, the council had dialogues with 85 companies identified through the screening process as having ‘confirmed violations’ of an international convention or where a ‘risk of violation’ was identified. Of these dialogues, more than half were about suspected human rights violations (60 per cent), a third related to business ethics (27 per cent) and the rest concerned environmental issues (13 per cent).

By influencing companies to take a more systematic approach to sustainability through policies, implementation, and transparency, the council said it can help prevent incidents from occurring. 3 056 companies passed the screening process without comment.

In 2021, work was initiated to develop and further strengthen the activities of the Council and a report on this process will be presented in 2022.

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