Instruments for Responsible Investment

We apply six instruments in support of the implementation of responsible investment activities.

We apply these instruments for the purpose of (1) contributing to social solutions; (2) encouraging companies in a position to make ESG improvements to do so; and (3) excluding companies that carry out activities that we do not want to support.
 

What we want to stimulate

1. Investing in Solutions

 

Investments in solutions for social development are clearly defined investments that not only contribute to the portfolio’s financial return, but are also intended to generate social added value. We invest in solutions for climate change, water scarcity, healthcare and food security.

What we want to improve

2. ESG integration into investment processes

 
The environment, social aspects and the quality of corporate governance can affect our clients’ return on investment. Conversely, the companies and agencies in which we invest can have an impact on the world around them. PGGM therefore firmly believes that taking account of ESG factors in the investment processes contributes to good risk management and can ensure that achieving financial returns is coupled with sustainable social improvements.

 
On the basis of the following three ‘active ownership’ activities, PGGM fulfils the rights and responsibilities associated with being a shareholder in listed companies:
 

3. Voting

 
Voting is one of the most important rights a shareholder has. We therefore vote on the basis of our own judgement at shareholder meetings. Consequently, we contribute to good corporate governance. For each company, PGGM publishes its voting record on a special website.

Download the Statement Compliance Dutch Corporate Governance Code (pdf)

4. Engagement

 
As a pension fund service provider we see it as our responsibility to engage with market participants and companies about their policies and activities. This way we attempt to achieve ESG-related improvements.

5. Legal proceedings

 
When necessary, PGGM institutes legal proceedings against companies on behalf of its clients as shareholder to recover investment losses and enforce good corporate conduct.

 

What we do not want

6. Exclusions


 
PGGM wants to avoid making investments that are deemed unacceptable to us or our clients. This is why we do not invest in controversial weapons or tobacco in the PGGM mutual funds and in mandates we manage internally for individual clients (hereinafter ‘PGGM funds’).
Furthermore, in the PGGM funds we exclude investments in government bonds issued by countries, if those countries are submitted to sanctions of the UN Security Council and/or the European Union. These sanctions can be the result of a situation of severe and systematic violations of human rights, or the use of controversial weapons.

 

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