Swedish pension fund AP7 has added two new companies to its blacklist due to the companies' large-scale operations in the oil industry without climate transition plans.

The two companies, USA company, EOG Resources, Inc. and Canadian company MEG Energy Corp, were therefore excluded for acting in violation of the Paris Agreement.

A total of 110 companies have been blacklisted and excluded from the fund’s investment universe.

The fund invests in companies that “satisfactorily” comply with the requirements of the international conventions, of which Sweden is a signatory, expressed in the 10 principles of the United Nations Global Compact.

These describe companies' responsibilities for human rights, working conditions, the environment, and anti-corruption, and are excluded and blacklisted if they violate these conventions.

In addition to this, AP7 blacklists companies that participate in the development and production of nuclear weapons. This is an advocacy tool used in collaboration with other influencing methods, such as company dialogues and voting at general meetings.

In 2016, the Paris Agreement was included as one of the norms on which the blacklist analysis is based and since then the analysis has been continuously updated.

AP7 said that the single most important measure to curb climate change has been phasing out coal as an energy source. In 2020, the Paris Agreement review was developed and coal companies with a large climate impact and expansion plans began to be blacklisted.

The requirements were tightened in 2022 as companies without transition plans with large-scale coal operations or oil sand extraction were blacklisted.

This year, AP7 continued to develop the criteria to include the largest oil companies without climate transition plans, and next year it plans for the audit to be expanded to include additional oil companies.

A total of 53 fossil fuel companies are blacklisted based on the Paris Agreement, while another 10 oil and coal companies are excluded on other grounds.

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