Swedish Pension Fund Cuts Ties with Fossil Fuels

Swedish pension fund AP1 announced on March 16 it would no longer invest in fossil fuels, because of climate-related financial risks.

"The fund's assessment concluded that the transition towards a low-carbon economy, less dependent on fossil fuels, represents a substantial uncertainty for companies involved in coal, oil and natural gas activities, and continued investments related to these activities can increase the financial risk exposure of the fund," AP1 said in a statement. 

The fund also said it had decided to draw up measurable targets for having for a carbon neutral portfolio by 2050.

AP1, which manages some crowns 365.8bn ($37.4bn) in assets, is the first of Sweden's five national pension funds to pledge to divest from fossil fuels. However, a number of Western funds have taken steps to reduce their exposure to the oil and gas industry, and in November last year the European Investment Bank also said it would stop financing fossil fuels by the end of 2021.