Swedish pension fund AP3 has raised concerns regarding the development of climate goals, highlighting the lowering of companies’ ambitions and the stewardship actions of investors.

In its Ownership Management Report, AP3 stated that it did not feel secure with how many companies are developing in relation to tackling climate issues.

In 2024, the pension fund said it had seen several examples of companies that have lowered their ambitions and goals, with some removing them completely.

It had also observed lower support in general for sustainability-related shareholder proposals.

“There still seems to be a gap between words and actions, both among companies and investors,” said AP3 head of sustainability and ownership management,” Fredric Nyström.

“But there are exceptions - not least among Swedish companies where ambitions are still high in many cases.”

This was demonstrated by this year’s Swedish general meetings, in which many companies decided to supplement financial performance conditions with sustainability-related conditions.

Of the incentive programs proposed at this year's general meetings, 41 per cent had sustainability requirements included, up from 25 per cent last year.

AP3’s report revealed that, in 2023/24, the pension fund had directly and indirectly had engagement on climate with 190 companies, on biodiversity with 179 firms, on human rights with 83 companies, and on corporate governance with 57 companies.

The number of general meetings in which AP3 voted in 2023/24 totalled 1,113.

"Another intense year of committed ownership is over,” Nyström stated.

“The third AP fund has actively strengthened its ownership governance within the framework of the fund's focus areas.

“At the same time as we increase our efforts, we look with concern at the development in the climate area, both regarding the companies' lowered ambitions and the actions of colleagues in the industry.

“Unfortunately, we can state that right now we do not feel secure with how many companies are developing.”

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