Storebrand, Norway’s largest private asset manager, reported a 13.7% return on equity for 2018, raising its total assets under management to NOK707 billion ($82.6 billion) on a profit of NOK3.7 billion after tax. The results improved upon 2017’s returns of 11.3%, and after-tax profit of NOK2.41 billion.
“2018 was a good year,” Odd Arild Grefstad, Storebrand’s group CEO, wrote in the fund’s annual report. “Our financial solidity was strengthened and there was an increase in the dividends distributed to shareholders. At the same time, the financial markets experienced turbulence at the end of the year, in a somewhat uncertain macroeconomic situation.”
The fund said that during 2018, it implemented several initiatives to strengthen its sustainability investments, and focused on water risk. It also said it formulated a special investment policy that will be launched in 2019 for deforestation, which encompasses soy, palm oil, and cattle farming.
“The financial industry is an important contributor in the efforts to limit global warming, and we have a clear strategy to invest through our own, targeted funds in companies that provide climate solutions,” said Grefstad. “Most importantly, we have strict environmental, climate, and sustainability criteria for all our investments.”
Storebrand excluded 171 companies from its investment universe as of the fourth quarter of 2018. The investments through Storebrand and its Swedish subsidiary SPP’s funds have a total carbon footprint of 21.8 tons of CO2 per NOK1 million of revenue. Storebrand said this is lower than the funds’ comparable indexes, which showed 31.8 tons in equivalent units of measurement.
In total, 23% of Storebrand’s portfolio is fossil free. It also said that nearly 5% of assets under management in Storebrand and SPPs fund portfolios is invested in companies that contribute specifically to sustainable development, and it has NOK68 billion invested in fossil-free products.
In 2018, Storebrand also launched Wave, three custom portfolios that invest exclusively in companies that contribute to solving global challenges related to renewable energy, sustainable cities, and gender equality. Under the program, the fund assesses all companies in its investment universe with respect to gender equality. In addition to assessing whether the companies have a policy to prevent gender discrimination, the fund also assesses whether they have initiatives to contribute to UN sustainable development goals.
Related Stories:
The Ontario Health Pension Turns in 2% Return for Tough 2018
Equities Killed Norway’s Sovereign Wealth Fund in 2018
Tags: Norway, Odd Arild Grefstad, Private Equity, Storebrand