Varma, a Finnish pension company, published a climate policy outlining how it will mitigate climate change through its investments. The policy's goals are to reduce the carbon footprint of listed equity investments by 25% and listed corporate bonds and real estate by 15% by 2020. In the long term, Varma will focus on low-carbon investments and those with climate strategies aiming for a low-carbon society. Varma recognizes climate change's importance and supports mitigation actions through its investment portfolio.

1. Climate policy for Varma's
investments
26 May 2016 | Climate Policy1

2. Varma is the first Finnish earnings-related
pension company to publish a climate policy
for its investments. It covers all asset classes
and outlines how Varma mitigates climate
change in its investment operations.
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“We are developing our
portfolio such that our
investments will be in line
with the 2-degree target.”
Varma’s CIO Reima Rytsölä.

3. Varma’s goal is to reduce the carbon footprint
of its investments by 2020
• by 25% in listed equity investments
• by 15% in listed corporate bond
investments and
• by 15% in real estate investments
In the longer term,
Varma will focus its
investments on investees
that are low carbon or
that have a climate
strategy that aims for a
low-carbon society.
Mitigating climate
change is one of Varma’s
CSR targets.
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4. Listed equity investments
The target will be achieved by investing in
companies with the best practices. We will
determine companies’ preparedness for
climate change during meetings with the
companies and by consulting various sources
of information. We are establishing a new
portfolio under the theme of climate change.
To reach the target, we will invest in
companies with the best practices and take
into account the carbon-intensiveness of their
operations as part of the selection process
and sector allocation. In our meetings with
companies, we will influence the attention
that is paid to climate change in their
operations.
Listed corporate bond
investments
In buildings, carbon dioxide emissions are
mainly caused by energy consumption arising
from electricity and heat production, which
we will reduce by improving the energy
efficiency of the buildings. As a general rule,
Varma’s most important buildings will be
certified according to the BREEAM
environmental rating system by 2025.
Real estate
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5. Varma is establishing a portfolio under the
theme of climate change. It will be made up of
• companies whose operations benefit from
climate change mitigation, for instance in
technology and renewable energy
production.
• companies that are prepared to make the
move to decarbonize
“As a major investor, we
have the opportunity to
influence companies and
encourage them to
reduce their carbon
footprint.”
Varma’s CIO Reima Rytsölä.
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6. Varma recognises the importance of climate
change to its investment activities and the
long-term development of the economy. We
support actions to mitigate climate change
and adapt to the upcoming changes.
Varma has signed the
CDP and joined the
Montréal Carbon Pledge
initiative, in which
investors commit to
measure and publicly
disclose the carbon
footprint of their listed
equity investments on an
annual basis.
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