Making pension funds more sustainable


Pension funds are major investors. For example, the Dutch pension fund for the public sector, the General Civil Pension Fund (ABP), is one of the largest pension funds in the world; one in six Dutch people is a participant. The total invested capital of ABP amounts to more than 400 billion euros.

Fossil investments contribute to climate change

Pension funds invest their money worldwide to guarantee a good pension for their members. Unfortunately, short-term profits are often considered more important than a sustainable future for people and the environment. Many pension funds invest large amounts in the fossil fuel industry, such as coal plants or oil and gas companies. Their investments in the fossil companies enable this industry to continue their activities, because those investments must be earned back.

However, people in the Global South are experiencing the effects of climate change earlier and harder than people in the Global North. At the same time, women and men in the Global South are also front line environmental defenders, and fighting the expansion of fossil fuel extraction in their localities. We think that global investors have a proactive role to play in our collective aim for 1.5 degrees as the red line for global warming.

That is why fossil investments by pension funds must be phased out as soon as possible. As a result, the fossil companies will lose their social license to operate, which speeds up progress in realising the Paris Climate Agreement. In Paris, the world has agreed to drastically reduce CO2 emissions and thereby limit global warming to 1.5 degrees.

Pension funds also invest in industries that are known for their major human rights and environmental issues, such as mining, and soy and palm oil plantations.

Tracking ABP's investments

Both ENDS wants to encourage pension funds to divest their assets from harmful sectors. We focus primarily on ABP, the largest pension fund in the Netherlands. ABP wants to be a "sustainable pension fund", as stated in its Vision 2020.

The analysis that Both ENDS, FossielVrij Netherlands and German urgewald have been doing of ABP's investments, however, show that not much of that is yet coming true. In both 2016 and 2017, ABP turned out to have invested more in coal, oil and gas than in the previous year. We think this is not in line with ABP's own vision, but it cannot be reconciled with "Paris" either. That is why we will continue to critically monitor ABP's investments, together with FossielVrij Netherlands.


Other major investors from all over the world have already shown that it is possible. Various pension funds, such as New York City's five pension funds, have withdrawn all their investments in the fossil industry. The Dutch BPL, the pension fund to which Both ENDS is affiliated, has divested from the coal industry.

Moreover, in early 2019 a group of wealthy Dutch people decided to remove all their personal assets from the top 200 oil, gas and coal companies. These Dutch people are part of the Dutch branch of the worldwide DivestInvest movement, which is supported by Both ENDS, Fossielvrij Netherlands and Stichting DOEN. By investing in climate solutions such as renewable energy, sustainable agriculture and efficient water use instead of polluting sectors, the DivestInvest movement wants to stimulate climate action and accelerate the energy transition.

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(deal_or_no_deal.JPG, 04/03/2009)