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Investments

The carbon footprint and the climate impact of the Group’s direct equity and fixed income investments is measured annually. More detailed information on each year’s results is available in Sampo Group’s sustainability reports.

Sector-based screening and engagement, such as direct engagement with management and voting at annual general meetings, are viewed as ways to influence investee companies and reduce transition risk. Information on sector contribution to emissions and engagements are reported annually in Sampo Group’s sustainability reports and the quarterly published factbook.

All Sampo plc’s subsidiaries are currently investigating possible climate-related targets for their investments.

Climate-related targets

If

In October 2021, If committed to the Science-Based Targets initiative (SBTi). The SBTi drives ambitious climate action in the private sector by enabling companies to set science-based climate targets for the reduction of GHG emissions. Following the commitment, If will develop the targets, submit them for validation, and communicate them externally within 24 months. All targets must cover a minimum of five years and a maximum of 15 years from the date the target is submitted to the SBTi.

If is a financial institution, and therefore the company follows SBTi’s sector-specific guidelines for the financial sector. If’s investment portfolio represents a majority of If’s total GHG emissions, and If will set targets for aligning the investment portfolio with the Paris Climate Agreement.

Topdanmark

Topdanmark committed to the Science-Based Targets initiative in May 2022. Topdanmark also supports the Business Ambition for 1.5°C campaign led by the SBTi in partnership with the UN Global Compact. Topdanmark follows SBTi’s sector-specific guidelines for the financial sector and will set targets aligned with the Paris Agreement for investments, claims handling and own operations.

Hastings

In investment operations, Hastings has committed to reducing the environmental impact of the investment portfolio and has pledged to reduce carbon intensity in the core investment portfolio by 50 per cent by 2030 and to be net-zero by 2050. Progress and the action plan to reach these targets will be monitored and reviewed by the Investment Committee.

Carbon Footprint of Equity and Fixed Income Investments

An external service provider calculates the carbon footprint of Sampo Group’s direct equity and direct fixed income investments annually. The latest calculation was conducted in the beginning of 2022 and it included If, Topdanmark, Hastings, Mandatum, and Sampo plc’s investments as at December 31, 2021.

The calculation method differs from year to year due to continuously improved data availability and the development of the service provider’s methodology. In addition, the changes in the Group structure have impacted the results. For these reasons, the results for different years are not comparable.

The financed emissions measure the carbon footprint of a portfolio taking Scope 1 & 2 as well as Scope 3 emissions into account. The relative carbon footprint is a normalized measure, defined as the total carbon emissions of the portfolio for each million euros invested. Carbon intensity is a metric that applies the ownership approach to also determine an investor’s share of revenue, subsequently dividing one by the other. By linking to revenue, the metric is intended to describe the carbon efficiency of the underlying holdings. The weighted average carbon intensity is derived directly from the TCFD recommendations, where GHG emissions are allocated based on portfolio weights rather than the ownership approach.

Carbon Footprint of Investments, Sampo Group

  31 Dec 2021 31 Dec 2020 31 Dec 2019* 31 Dec 2018*
Direct Equity Investments        
Financed emissions Scope 1 and 2, tCO₂e 150,791 172,505 148,164 334,382
Financed emissions incl. Scope 3, tCO₂e 2,339,007 497,076 494,472 1,504,981
Carbon intensity, tCO₂e/ EURm revenue 117.97 133.12

109.00

110.8
Weighted average carbon intensity, tCO₂e/ EURm revenue 105.74 134.68 93.00 117.50
Direct Fixed Income Investments        
Financed emissions Scope 1 and 2, tCO₂e 450,478 652,206 663,513 1,478,900
Financed emissions incl. Scope 3, tCO₂e 3,950,191 2,042,254 2,019,765 5,601,043
Carbon intensity, tCO₂e/ EURm revenue 167.48 193.23 299.00 134.20
Weighted average carbon intensity, tCO₂e/ EURm revenue 55.06 57.84 76.00 52.10

* Excluding Hastings

Climate Impact of Equity and Fixed Income Investments

Sampo Group measures the climate impact of its direct equity and direct fixed income investments annually. The latest assessment was conducted by an external service provider in the beginning of 2022. The assessment included If, Topdanmark, Hastings, Mandatum, and Sampo plc’s investments as at December 31, 2021.

Climate Scenario Analysis

Part of the climate impact assessment was an analysis of whether Sampo Group’s direct equity and fixed income investments are aligned with the International Energy Agency’s (IEA) scenarios. The scenario alignment analysis compares current and future portfolio GHG emissions with the carbon budgets for the IEA’s Sustainable Development Scenario (SDS), Stated Policies Scenario (STEPS), and Current Policies Scenario (CPS). Performance is shown as the percentage of assigned budget used by the portfolio and benchmark.

According to the service provider’s analysis, Sampo Group’s direct equity and fixed income investments in their current state are misaligned with the SDS scenario, meaning the 1.5°C scenario, by 2050. The portfolio exceeds its SDS budget in 2042, and it is associated with a potential temperature increase of 1.7°C by 2050, whereas the benchmark (iShares MSCI World ETF) has a potential temperature increase of 2.8°C. However, compared to a similar analysis conducted in 2020, the results have improved. In the 2020 analysis, the portfolio exceeded the SDS budget in 2037, and it was associated with a potential temperature increase of 1.9°C by 2050.

Climate Target Analysis

In order to transition to a low carbon world, investee companies need to commit to alignment with international climate goals and demonstrate future progress. According to a climate targets analysis conducted as a part of the climate impact assessment, 43 per cent of Sampo Group’s direct equity and fixed income investment value as at December 31, 2021 was committed to such a goal. This includes ambitious targets set by the investee companies, as well as committed and approved Science-based Targets (SBT). There is a clear improvement of the results, compared to a similar analysis completed in 2020.

Going forward, Sampo Group is closely following the climate actions taken by their investee companies to manage climate risk.

Exposure to Physical and Transition Risks

The climate impact assessment also measured the exposure of Sampo Group’s investments to physical risks and transition risks. The assessment concluded that Sampo Group’s direct equity and fixed income investments are not exposed to a high level of acute or chronic physical risk, as most of the investments are in geographical regions and in sectors, where physical risks are considered low. Sampo Group also has limited exposure the sectors such as utilities, which are particularly affected by the shift to a low carbon economy, which reduces the exposure to transition risks.

Direct Real Estate Investments

At Sampo Group, the management of direct real estate investments was previously concentrated in the parent company, Sampo plc, where the investments of If, Mandatum, and Sampo plc were managed. As of 1 September 2021, due to the restructuring of Mandatum Group, the real estate investments are managed in MAM. 

During 2021, the fully owned direct real estate investments of If and Sampo plc were sold. On 31 December 2021, the number of built properties owned by Mandatum was 18. In addition, Mandatum owns empty plots and some minority shares in other properties.

In addition to Mandatum’s properties, MAM is responsible for the direct real estate investments of Mandatum Life Vuokratontit I Ky, SaKa Hallikiinteistöt Ky, Kaleva Mutual Insurance Company, Erikoissijoitusrahasto Mandatum AM Suomi Kiinteistöt ll, and Mandatum AM Hiilinielukiinteistöt I Ky, which are not part of Sampo Group.

Sustainability focus areas of direct real estate investments

MAM focuses on energy efficiency, curbing climate change, water efficiency, recycling, and reducing the amount of waste, as well as providing sustainable, healthy, and safe properties for tenants. MAM has also set sustainability targets for the investments, and reports on progress on a regular basis. 

Sustainability Targets of Direct Real Estate Investments, Mandatum

Target Baseline year Target year, by the end of year Progress by 31 Dec 2021
Reduce water consumption by 10 per cent 2018 2022 Water consumption reduced by 26.3 per cent compared to the baseline year. The result was impacted by COVID-19, and therefore a new target was not set.  
Achieve carbon neutrality regarding the properties’ own energy consumption (electricity and heating/cooling) 2019 2025 Carbon footprint (Scope 1 and 2 GHG emissions): 2,599 tCO2e.  
Reach a recycling rate of 55 per cent 2020 2025 The recycling rate was 51,6 per cent and data coverage 99 per cent. 

Reduce energy consumption by 20 per cent (calculated energy efficiency) in accordance with the Energy Efficiency Agreement*

2015 2025 Energy consumption reduced by 19.0 per cent. 
Get four stars from GRESB reporting  2020 2025

Four stars and Sector Leader status achieved in 2021. New target set in 2022: To keep four stars by the end of 2025. 

* The Energy Efficiency Agreement and the figures related to it include the properties of Mandatum Life Vuokratontit I Ky, SaKa Hallikiinteistöt Ky, and Keskinäinen Vakuutusyhtiö Kaleva. 

The carbon footprint of the direct real estate investments is also measured annually. In real estate investment management, energy efficiency actions have been successful and electricity consumption has decreased. The properties’ automation systems are monitored remotely, which enables the optimisation of indoor conditions and thus a reduction in energy consumption. Through continuous energy management, the available energy-saving potential is detected, and energy consumption can be monitored in real time.

Carbon Footprint of Direct Real Estate Investments

tCO2e  2021 2020 2019
Scope 1 GHG emissions  0.0 0.0 0.0
Scope 2 GHG emissions   2,599.2 3,105.6 6,280.4
Scope 3 GHG emissions  261.6 248.0 219.1
Total (Scope 1-3) emissions  2,860.8 3,353.5 6,499.5

 

Updated 3 Jun 2022