Responsible investments

DNB sets a high standard for responsible investments.

This means that we look at environmental, social and governance (ESG) factors in all portfolio management.

Group instructions for responsible investments

Annual report for responsible investments

Important tools in this work are:

Standard setting

Active ownership through dialogue and voting

Exclusion

Integration of ESG opportunities and risks

Responsible and sustainable investments

The main purpose of responsible and sustainable investments is to achieve a good long-term return with an acceptable level of risk. At the same time, we must take into account significant risks and opportunities associated with the environment, social relationships and corporate governance.

All management is subject to DNB’s corporate standard for responsible investments.

The standard is based on international norms and standards. It ensures that DNB does not contribute to an infringement of human and employee rights, corruption, serious environmental damage or other actions that can be perceived as unethical. It will also ensure that assessments of ESG risks and opportunities are integrated into the management.

We exercise ownership in accordance with international norms and standards:

Principles for Responsible Investments (PRI)
UN Global Compact
UN Guiding Principles on Business and Human Rights
G20/OECD’s principles for ownership management and corporate governance
OECD guidelines for multinational companies

In 2021, as part of the Net Zero 2050 ambition, DNB decided to set an objective to increase the total assets with a sustainability profile to NOK 100 billion by 2025.. In addition, the goal is for half of the net flow in 2025 to go to such funds.

A fund with a sustainability profile can be either a fund with a low level of greenhouse gas emissions, a fund that invests in companies that contribute with solutions or a fund that has the UN Sustainable Development Goals (SDGs) as a framework for investments. In 2021, we launched two new funds with a sustainability profile: An index fund that uses a benchmark index that is in line with the Paris Agreement, and a global equity fund that uses the UN Sustainable Development Goals (SDGs) as a framework.

More about mutual funds with a sustainability profile

In our work on responsible and sustainable investments, we have defined long-term and short-term focus areas. These are important in active ownership administration, standard setting and ESG integration. Ambitions and target attainment within each of the areas are described in the annual report for responsible investments.

What is our approach to responsible investments?

Standard setting

We develop expectation documents that are based on best practices and communicate requirements and expectations to the companies we invest in. The expectation documents are an important basis for our efforts to exert a positive influence, and are used in reactive and proactive dialogues with companies. We have developed expectation documents in the following areas:

climate
biodiversity
serious environmental damage
anti-corruption
tax
equality and diversity
human rights
sustainable ocean
water

Go to the expectation documents

Active ownership administration

Exclusions

Companies that breach DNB’s standard for responsible investments, and that do not show a willingness to change, may be excluded from our investment remit. This includes both standard-based and product-based criteria. For example, we do not invest in companies where there is an unacceptable risk that the company will contribute to serious breaches of employee rights (standard-based), or in companies that produce controversial weapons (product-based).

ESG integration

We keep a close dialogue with our portfolio managers about significant ESG risks and opportunities. We screen companies against our standard for responsible investments for product criteria and breaches of norms and standards, analyse companies to detect significant ESG risks and opportunities, and give recommendations to the managers.

ESG and CO2-data are integrated into the portfolio management system, and are used as input for valuation, investment decisions and portfolio construction. We have a system in place to identify changes in the companies’ ESG assessments and potential violations of international norms and standards. This information is regularly shared with portfolio managers and gives them good insight into the ESG situation at the companies. This information can also lead to proactive and reactive dialogues with companies, often in partnership with our managers.

One point of strength in our work with ESG integration is that we have good managerial expertise in the team for responsible investments and that each fund has a dedicated ESG analyst who is responsible for monitoring the fund. Our experience is that this provides a better basis for information and investment decisions.

Voting

Voting at the general meeting is an important part of our active ownership and must be assessed in the context of the ongoing dialogues we have with the companies.

More about our voting rights

Dialogues

Proactive and reactive influencing dialogue with companies is a central part of our work. The discussions are structured processes with clear objectives for desired outcomes.

More about our influencing dialogues

Initiatives

An important part of the efforts to exert a positive influence is participation in global investor collaboration.

See the initiatives we have signed up to

Sustainability reports

We want to be open about our work on responsible investments, and regularly publish updates.

See our sustainability reports

Why are we concerned about being responsible?

To build a better business case

To reduce risk

We analyse companies using external ESG data and reports, in addition to doing our own ESG modelling.

We uncover significant ESG risks and opportunities for our portfolio managers, and report existing or potential controversies.

Based on our findings, we provide input on possible changes to the portfolios. The portfolio managers are informed of changes to the ESG score and controversies related to companies included in the portfolio.

To improve the risk-adjusted return

To exploit growth markets and find innovative companies

To ensure that all investments are ethical