This makes district heating a nationally important core infrastructure for Sweden. “High temperature-driven heating requirements in Sweden, an AAA-rated country, cause district heating consumption per capita to be amongst the highest in the European Union. The remaining 50% stake is owned by the City of Stockholm.Ĭarlo Maddalena, Senior Portfolio Manager at APG: “The Stockholm Exergi investment is an excellent fit with APG’s infrastructure strategy and with its strong sustainability focus, it is at the core of the energy transition.”Īccording to Maddalena, Stockholm Exergi's fundamentals are very strong. Stockholm Exergi's 800,000 customers are concentrated in the Stockholm municipality. The consortium has bought the 50% stake from the Finnish energy group Fortum. APG has acquired the 20% stake on behalf of pension fund client ABP, which wants to further shape its climate- and responsible investing ambitions. The consortium also comprises of PGGM, Alecta, Keva and AXA Investment Managers. The company is an industry leader in sustainability and has the ambition to become climate positive by 2025. With close to 10 TWh in yearly energy sales and an annual turnover of almost €700 million, Stockholm Exergi (700 employees) is the largest supplier of district heating in Sweden. While APG's ambition goes beyond the six metrics identified by the ESG Data Convergence Project, we are excited by the momentum generated, with data collection by private equity managers already underway.“Ī consortium led by APG has acquired a 50% interest in Stockholm Exergi Holding AB. APG will use the metrics in its engagement with managers. ”Through this collaboration, we expect to push towards comparable ESG performance measurement and wider adoption of ESG as an integrated objective of private equity investments. “On behalf of clients, APG has long been driving ESG transparency in private equity as a way to secure accountability for responsible investment performance in the asset class,” says Peter Branner, APG’s Chief Investment Officer. Investors can use this to compare the ESG performance of private equity funds with the industry average. A third party will aggregate the data into an anonymized benchmark. The initiative starts with six metrics: greenhouse gas emissions (scopes 1 and 2), renewable energy, board diversity, work-related injuries, net new hires and employee engagement. This gives investors such as APG a better insight into the investment risks and opportunities in their private equity investments. The aim of the ESG Data Convergence Project is to agree on a number of standard ESG metrics and to provide guidelines for technical measurement issues, such as how to determine investments’ carbon footprint. This makes it difficult for investors in private equity, such as APG, to assess and compare the various funds’ ESG performance. Until now, there was no generally accepted standard for the way in which private equity funds report on ESG. The more organizations report in a comparable way, the better the private equity industry can collect meaningful data and further sustainability. The founders, with total assets under management of over $ 4 trillion, call on other funds and investors to join. Various major organizations are joining the initiative, which is led by CalPERS, the largest pension fund in the United States, and global private equity firm Carlyle. The 'ESG Data Convergence Project' is the first-ever collaboration between private equity funds and investors in these funds to standardize ESG metrics (ESG: environment, social & governance). Ultimately, this should promote sustainability in the private equity industry. With the initiative, the launching partners, including APG, aim to increase the quality, availability and comparability of ESG data. Some of the world’s largest private equity firms and investors have agreed on a first set of ESG metrics for private equity funds and underlying companies to report on. Private equity firms and investors launch 'ESG Data Convergence Project'
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