Asset Manage­ment

Sustainability criteria in our investment decisions

VIG's long-term ambition in the spheres of impact asset management is to reduce emissions from selected investment portfolios to net zero by 2050. The first interim goal is a 30% reduction in emissions in these portfolio by 2030 (base year 2023), as outlined in VIG’s Transition Plan for Climate Change Mitigation. VIG reports its so-called Scope 3 emissions from selected investment portfolios on an annual basis and is constantly working to improve data quality. These emissions form the basis for measuring VIG’s progress in the area of investment—specifically for the corporate bonds and equities portfolio as well as the real estate portfolio—as outlined in the Transition Plan for Climate Change Mitigation.

Since 2019, VIG has incorporated defined social and environmental criteria into the investment process for selected asset classes. In 2023, this approach underwent a comprehensive redesign. For details, see the document “Responsible Investment.”

One focus of the new declaration is active exchange and dialog with companies to encourage them to improve their sustainability performance. This activity is referred to as engagement and is disclosed in an annual report.

In addition to the engagement approach, VIG has tightened its existing exclusion criteria and added new ones. The exclusions relate to the following areas:

• Thermal coal
• Unconventional oil and gas
• Banned weapons
• Violation of human rights and the principles of the UN Global Compact

Continuous increase of investments in green bonds

VIG's declaration "Responsible Investment" specifies to increase the proportion of investments that meet defined environmental criteria. These include, for example, green bonds. VIG considers green bonds to be investments that contribute to the financing of projects with objectives such as climate change mitigation, renewable energy or sustainable infrastructure.

VIG has successfully issued its second sustainability bond

As part of its active capital management, VIG Holding successfully issued a Tier 2 sustainability bond with a volume of EUR 300 million in a challenging market environment. Following the first issuance of a sustainability bond in 2021, this is VIG’s second sustainable bond and the first in the Tier 2 format. The bond is intended to support projects in the areas of renewable energy, energy-efficient buildings, and low-emission transportation, as well as social projects aimed at increasing affordable housing and improving access to basic services such as education and health care.

Controlled investments

The issue is based on the revised VIG Sustainability Bond Framework, which was verified by the independent ESG rating agency Sustainalytics through a second-party opinion (SPO) and, for the first time, also includes an assessment of EU Taxonomy compliance. 

The Sustainability Bond Committee, which was set up as part of the first sustainability bond, again ensures that the funds are used in accordance with the framework and are reported on accordingly. It consists of representatives from different areas of the Group, such as Group Treasury & Capital Management, Asset Management incl. Real Estate as well as Compliance. 

Real estate Investments

Buildings account for around 40% of energy consumption and around a third of greenhouse gas emissions in the EU. Thermal renovations and the use of renewable energy can therefore help reduce emissions in the building sector. At the same time, many people are faced with the challenge of rising housing costs.

Among other things, VIG invests in the construction of affordable housing and collaborates with companies that plan and implement housing projects in accordance with defined social and environmental criteria. These criteria may include affordability, energy efficiency, or the use of renewable energy.