Sustainability and financial returns go hand-in-hand

Snorre Gjerde has always enjoyed working at the intersection between finance and sustainability. He began his career on the fund’s graduate programme and landed his dream job on completing it. He is now part of a team focusing on environmental issues in the fund’s ownership department.

The fund is the single largest investor in the world’s listed companies. Its value depends on the value created by the more than 9,000 companies in which it is invested. The ownership department’s role is to set clear expectations of how companies should address global sustainability challenges in their operations, and steer them in the right direction.

Snorre’s team focuses on financially material environmental issues, ranging from climate risk and biodiversity loss to how companies manage water resources and use the oceans responsibly.

“We work on improving standards and corporate sustainability reporting across markets,” he explains. “At the portfolio level, we follow up on the fund’s investments to reduce our exposure to unacceptable risks, and we also work a lot with individual companies.

“Since we’re a large investor in so many companies, it’s important to have an ongoing dialogue with them, not only to push our expectations, but also to learn. We hold companies to account for their impact on society and the environment. We can also send signals by being open about how we plan to vote at shareholder meetings.”

The fund votes on more than 120,000 proposals from companies’ boards and shareholders during the course of a year. Snorre has seen sustainability topics becoming more prominent in recent years, partly through an increasing number of shareholder proposals. It is important for the fund as a responsible investor to lead the way.

“It’s essential that we reach decisions in a consistent and clear way that provides predictability for companies and other stakeholders, while also looking after the fund’s interests as an investor.”

 

Our expectation documents are important in this process, setting out how we expect companies to address global sustainability challenges in their operations.

“The expectation documents are a key instrument for us and serve as a platform for much of our work on active ownership, so we spend a lot of time developing and updating them. They are a great starting point for our discussions with companies.”

Professional environment and real influence

Every day, Snorre learns something new that he had not anticipated. For example, there is a great deal to consider when he and his colleagues vote at shareholder meetings.

“So much needs to be evaluated and assessed. Even with extensive analytical support and general principles to work towards, we often have to reach a position on complex and nuanced problems. The world is not black and white, but ultimately we still have to vote either yes or no. This can be a challenge, but it’s incredibly rewarding to be part of this and to influence our decisions.”

Snorre is delighted to work somewhere with such a strong professional focus and where responsible investment is so important. He says one of the best things about the fund is its people and learning opportunities.

“We have this culture where you’re expected both to perform and to collaborate widely. Wherever I’ve been in the organisation, whatever role I’ve had, there are always people who are ready to discuss things and help you".

 

"My colleagues in the ownership department have a wide range of professional backgrounds but share a commitment to environmental and social issues and responsible investment”, Snorre adds.

Motivation and responsibility

The fund’s role in Norwegian society is a clear source of motivation in his work. In a busy working day with short deadlines, he sometimes has to take a step back and remind himself of the fund’s long-term objective. He also feels a keen sense of responsibility.

“Faced with a tricky problem, I’m always conscious of the importance of finding a robust solution, because it means so much to so many different stakeholders. We’re managing other people’s money, and the choices we make must be the right ones. At the same time, it’s hard because you could always dive deeper into an issue and re-examine your decisions one more time. To work here, you must like to be challenged and be comfortable with there not always being a straightforward answer to everything.” 

Last saved: 14/06/2022

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