How to make the world a little bit better

Sustainable investing? Yes please. But preferably in such a way that it does not come at the expense of my pension. Contributing to a better world, to a livable world, now and in the future. We all want that. Just like a good pension.

Gerrit Willem Gramser, or “GW, as everyone calls me”, is Group Treasurer at AkzoNobel. He sits on the investment committee as a board member of our pension fund. GW explains why socially responsible investing is so important and what this means for our pension fund.

Taking good care of people and nature is in our DNA

“For us, sustainable entrepreneurship is not a recent trend. Or something we pay more attention to now. We have always done that. Because AkzoNobel has traditionally been a chemical company and chemistry can be a dangerous substance. For people and nature. The focus on sustainability and safety is second nature for AkzoNobel, Nouryon, Nobian and Salt Specialties. In the company, in the culture, in everything we do. This applies just as much to companies as it does to our pension fund.

“Of course, a good pension comes first. But in a livable world. Now, but also later.”

We always look for the best balance

Our principle as a pension fund is to try to invest money as best as possible. So that people have a good pension benefit later. We look at return, risk, sustainability (ESG) and costs. We are constantly looking for that balance. And according to our participants, we also found that, according to our previous research.

Of course, there are participants who give greater weight to higher returns and participants who lean in the other direction and believe that sustainability may come at the expense of returns. In that sense there are always personal preferences. But the majority agrees with the current balance.

We invest in ESG leaders

In the investment world, sustainability (ESG) is often something negative. Something that entails risks. We would like to turn that around and see sustainability as an opportunity. We believe that companies that are at the forefront of sustainability, the ESG leaders, will do better in the future than their competitors who pay less or no attention to it.

We are not moral knights with big words without concrete plans. We invest in companies that are doing well based on objective sustainability data. And we ignore companies that do not score well on the sustainability ladder. By supporting companies that are at the forefront of ESG criteria as much as possible, we show others: sustainable policies make money.

‘Hold on, we want to do better’

We naturally hope that we will encourage companies that do not yet have the best score to also pay more attention to sustainable entrepreneurship. We'd like them to think: 'Hold on, we are falling further and further behind, what else do they do? Can we do that too? Because that has the support of investors.’ At the same time, we encourage companies that are doing well to continue to do well. Or to do even better. In short, we reward good behavior.

Put your money where your mouth is

I think you can make the whole world a little better this way. Instead of looking at what's not going well, look at what's going well and encourage that. We do not make extreme choices, but choose to invest in companies that are doing better than the average.

We expect that the average sustainability performance of companies will increase. So we also continue to make further selections to ensure that the companies we invest in continue to perform better than that average. And those lagging behind notice that they receive less and less investment from investors and therefore cannot lag behind much longer. This is how you make the world a little bit better.

"We invest in companies that are at the forefront. In this way we make better even better and encourage the rest to do better."

Let's see what happens

"I think it is very important that you can always explain what you do. That is quite difficult when you talk about ESG. Because how do you measure that? It is often still 'beautiful stories' that you hears about doing it well and wanting to do it. But let's see. How do you measure the impact you make? It would help if we made it much more data-driven, in my opinion I certainly believe that people accept and appreciate that. More transparency, clarity. Let's work on that together

How do we invest sustainably?

Our principle as a pension fund is to try to invest money as best as possible, to insure people have a good pension benefit later. We use a quadrilateral for this. The 4 corners contain return, risk, sustainability (ESG) and costs. These topics must be balanced as best as possible.

In other words: you want a good pension for everyone, i.e. a return. You must take the risks into account so that you can offer that pension with reasonable certainty. Attention to ESG is important to be sustainable. At the same time, you have to take costs into account, because the best may also be the most expensive. That in turn eats into returns.

What exactly is ESG?

ESG stands for Environment, Social (people and society) and Governance (good governance). These are the 3 most important criteria when it comes to measuring sustainability and therefore form the basis of sustainable and responsible investing.