The Evangelical Lutheran Church of Finland is committed to the development of responsible investment. As of 2008, the Church Pension Fund has undertaken to comply with the UN Principles for Responsible Investment (PRI) and has built its responsible investment activities around these principles.
The guidelines for responsible investing were updated on June 2014. The guidelines shall also serve as an example for parishes and other investment entities within the sphere of the Evangelical Lutheran Church of Finland.
The Church Pension Fund applies several different approaches to responsible investing and combines them in different ways. The different approaches are not mutually exclusive, but rather look at the issue from different angles.
Approaches to responsible investing
The responsible investment approaches of the Pension Fund include responsibility analysis, active ownership and engagement, and impact investing.
- Responsibility analysis is used to assess the level of responsibility of investment objects in terms of the different ESG (Environment, Social and Governance) criteria, and this information can then be used to either favour or avoid the companies in question.
- Active ownership and engagement mean that the Pension Fund initiates a dialogue with a company in order to change corporate practices. In direct engagement, the Pension Fund attends annual general meetings and participates in company dialogues. In indirect engagement, an asset manager or consultant carries out the dialogue with the companies and participates in the annual general meetings on behalf of the Pension Fund.
- Impact investing refers to investments in companies, organisations or funds, whose purpose is to make investment returns along with a significant social or environmental impact.
The Church Pension Fund secures the payment of pensions
Established in 1991, the Church Pension Fund is a restricted fund intended to secure the payment of pensions to Church employees and to balance the future development of the parish pension payments. The Pension Fund uses external asset managers in the investment management.