Andres van der Linden
With an invested capital of 266 billion euros, we have a global stamp on what should grow and what should not. We believe that money is a driving force, which will give the environment and society a great deal of progress in the right direction. Andres van der Linden, Advisor Responsible Investment, started working for PGGM because he wanted to make impact. “But it is not just me who cares about impact. The participants of PFZW also care about it: of course, they want a good return but they want to see the impact of their investments too. We have to recognize that ESG is moving beyond ESG, PGGM is moving toward impact.”
Tackle the biggest issues in the world
Andres grew up in the Philippines, but moved to the Netherlands in 2008 where he studied Sustainable Development at the Utrecht University. Why did he choose this study? He went to East Africa for an internship at the end of his Bachelor’s where he experienced first-hand the impact of international development. During that time, he decided that he wanted to be more involved in these themes so he started studying Sustainable Development. Afterwards, he worked 4,5 years for Sustainalytics and then another 3 years at Triple Jump, an impact investing firm. In 2021 he moved to PGGM. Why PGGM? Andres: “In one word: impact. I worked for an impact investor before and I really believe that meaningful change is happening in these firms. But I really realize that if we want to tackle the biggest issues in the world, impact principles need to be adopted by larger financial institutions and not just smaller private equity focussed funds. For me, PGGM represents this opportunity. To work for a large institutional investor and drive change at scale.
The power of diversity
Currently Andres works at the Responsible Investment team, specifically in the Active Ownership team. Andres: “Our Responsible Investment team consists of 20 people and our Active Ownership team is 5 people. The Responsible Investment team is quite international, with around 25 percent of the team-members not being Dutch. I think this is important because of the power of diversity. People with diverse backgrounds and opinions really help in our thinking process. It also makes it a very convivial and fun environment.” Andres believes that although PGGM is a Dutch institution at its core, it is very welcoming to people with an international background. Even though I just started at PGGM in February during lockdown times, it has been a very enjoyable experience so far.”
“Of course, it is crucial that participants of PFZW get enough pension money when the time comes, but I believe they also care about the impact that their money makes belong the way.”
The impact of participants money
Andres explains there are a few things that set PGGM apart. “First of all, we manage pension money. This makes us inherently a long-term investor. This is conducive to the ESG analysis as ESG factors tend to become more material in the long term. Second of all, our largest client is a pension fund with a participant base that cares. Healthcare professionals have a vested interest in the wellbeing of society. Of course, it is crucial that they get a decent pension when the time comes, but they also care about the impact their money does along the way. This allows PGGM to increase the depth and breadth of our Responsible Investment activities. I believe this is really reflected in the PGGM’s strategy going forward. It is clear that we understand that stewardship means more than protecting people’s financial futures. It is also about helping to safeguard a future that is worth living in.”
“Currently around 25 percent of the team-members are not Dutch. This is important because of the power of diversity.”
What is engagement?
“Engagement, which is a part of active ownership, basically means: creating dialogue with companies over time. Once you are invested in a company, we can speak to companies and help shape the direction they are going. We shouldn’t interfere with a company’s management, but we as shareholders have a responsibility to let them know our position. Companies know how to manage their operations best, but investors have a birds-eye view of the economy through our portfolios.”
“We shouldn’t interfere with a company’s management, but we as shareholders have a responsibility to let them know our position.”
How we select companies to engage with
How do we select companies to engage in at PGGM? Andres: “We engage with companies based on the priority areas of our client. Currently the scope of the climate change active ownership program includes oil and gas companies, food producers, and banks that finance fossil fuel development. Within these areas we select the companies that have the largest impact, those that are more receptive and those that are not being engaged by other institutions."
Do it together
"Engagement is most successful when you do it with other investors. Simply because you can represent a larger percentage of companies’ shares, which is important to companies. The starting point is getting together with other likeminded investors and deciding the direction we want to push that company. The 'Climate Action 100+ ' initiative consists of around 270 investors that align their expectations for companies with regard to climate change. it is critical that there are so many investors representing trillions of dollars of assets under management. This is a big amount of leverage and represents a big driving force."
Voting against Shell’s energy transition plan
"The most high-profile thing that happened since I started working for PGGM is engaging with Shell and voting at their Annual General Meeting. This year we decided to vote against Shell’s energy transition plan, which was a big move for PGGM to suddenly change direction. But I think the time was right to be more critical. This caused a lot of publicity in the media because PGGM as the second largest pension fund manager in the Netherlands."
A meaningful initiative
A key initiative that shows that we are leading in the field of social investment? Andres: “The SDI AOP (Sustainable Development Intvestment Asset Owners' Platform), which was set up together with APG, Australian Super and British Columbia Investments. This platform allows investors to identify and classify companies that contribute to the Sustainable Development Goals using a proprietary taxonomy. This is really the direction the market is going: Impact investing is going to become bigger; it is going to extend beyond private assets to publicly listed companies. This platform is a meaningful step in that direction and shows that we’re frontrunners. This is important because this is what our pension funds participants care about, as well."
Change happens in the long-term
What is Andres’ primary goal in the next year? "I want to expand our climate change active ownership program. I would like to increase the number of companies we are engaging and to become more outcome orientated. Tracking engagement outcomes can be difficult because change happens over the long term but it is important to track our progress. It is difficult to categorize in what constitute it changed and what was our contribution to that change in the company. I think it is very important to our client to prove that our efforts lead to something meaningful and that we need a proper framework to track change and impact. That are the things that I want to do in the next one or two years."
At PGGM, we do the pension administration for 4.4 million people who largely work or have worked in the healthcare sector. So if you work at PGGM, you contribute towards the financial security of people who have spent their working lives caring for others. We therefore know a great deal about pensions. With that knowledge, we help to design the new pensions system. And with invested assets of around €268 billion, we have an influence on the course followed by countless businesses all over the world.
Work is not just a way of getting through the day. Work contributes towards something. Action is reaction. The question is, how much impact do you want to have? Check out the vacancies on our website.