KLP Sustainability AccountsANNURAL REPORT 2020
Integrating corporate responsibility into all our operationsSTRATEGIC OBJECTIVE
Employee statistics
KLP's employees are a key resource, and KLP wants to be an organization with committed employees who are able to utilize their own expertise and technological opportunities. KLP works systematically to achieve a wage balance.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators show how KLP supports several of the UN Sustainable Development Goals:
- Goal 8, Decent work and economic growth, including target 8.5: By 2030, achieve full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value; and target 8.8: Protect labour rights and promote safe and secure working environments for all workers.
- Goal 10, Reduced inequalities, including target 10.2: By 2030, empower and promote the social, economic and political inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin, religion or economic or other status
TARGET
Targets not defined or relevant.
| 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets | |
|---|---|---|---|---|---|---|
| Employees of KLP | 1 018 | 1 007 | 990 | 961 | n/a | n/a |
| Part-time employees of KLP | 5,4 % | 6,8 % | 6,9 % | 7,6 % | n/a | n/a |
| Temporary employees | 34 | 35 | 26 | 30 | n/a | n/a |
| Turnover among employees | 3,1 % | 6,8 % | 7,1 % | 6,0 % | n/a | n/a |
| Total pay to employees (NOK thousands) | 852 297 | 818 805 | 785 965 | 743 833 | n/a | n/a |
| Average salary, women (NOK thousands) | 726 | 718 | 685 | 660 | 8. | 8.5 |
| Average salary, men (NOK thousands) | 868 | 859 | 836 | 808 | 8. | 8.5 |
| Age distribution among employees (share under 30 / 30-50 / over 50) | 4 / 53 / 43 % | New | New | New | 10. | 10.2 |
The number of employees refers to permanent employees in Norway, Sweden and Denmark, and includes employees on leave of absence and employees working part-time.
Turnover is the share of people who have left KLP. People who have changed jobs internally within the KLP Group are not included.
Total pay to employees refers to total actual salary taken to expenses, minus fees to external entities. Benefits in kind are not included. Information concerning salary relates only to Norway.
Average salary by gender is calculated from contractual salary based on full-time employment and is not adjusted for the proportion working part-time. The reason women’s average pay is lower than men’s is that the proportion of men in highly-paid positions is higher. KLP does not have any salary differences between the sexes in similar positions.
Health and sickness absence
It is important that our employees have a good working environment. KLP’s employees, and their collective skills, are a key resource for KLP. KLP is constantly striving to reduce employees’ sickness absence.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators show how KLP supports several of the UN Sustainable Development Goals:
- Goal 3, Good health and well-being.
- Goal 8, Decent work and economic growth, and especially target 8.8: Protect labour rights and promote safe and secure working environments for all workers.
TARGET
KLP’s target is to keep sickness absence below 4 per cent.
Results in 2020
In 2020, total sickness absence was 3.2 per cent, which is significantly lower than previous years and the target of 4 per cent. Long-term sickness absence was 2.3 per cent; it has remained stable for the last three years. The low sickness absence in 2020 is due to a decrease in short-term absence. Short-term absence fell from 1.6 per cent in 2019 to 0.9 per cent in 2020, and it is natural to assume that the Covid-19 pandemic had a bearing on this. A focus on hand hygiene and infection prevention and strict infection control measures have helped reduce the incidence of other illnesses such as colds and the flu, and increased flexibility when working from home may have helped reduce short-term absence. There has also been a focus on how to maintain a good working environment for KLP’s employees when working from home. KLP has taken several measures to facilitate a good working environment, including one-off support payments to employees for the purchase of equipment.
| 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets | |
|---|---|---|---|---|---|---|
| Short-term sickness absence | 0,9 % | 1,6 % | 1,8 % | 1,6 % | 3. | n/a |
| Long-term sickness absence | 2,3 % | 2,3 % | 2,4 % | 2,9 % | 3. | n/a |
| Total sickness absence | 3,2 % | 3,9 % | 4,2 % | 4,6 % | 3. | n/a |
| Gender breakdown of sickness absence (women/men) | 4,2 / 2,4 % | 6,7 / 2,0 % | 5,4 / 3,2 % | 6,5 / 3,7 % | 3. | n/a |
| Number of personal injuries | 0 | 2 | 1 | 0 | 8. | 8.8 |
Sickness absence is self-certified and doctor-certified sickness absence. Short-term sickness absence is defined as 1-3 days; long-term absence is 4 days or more.
Personal injuries are self-reported injuries to employees and claims for actual and possible occupational injuries to KLP’s non-life insurance company.
Diversity and equality
KLP is constantly working to integrate diversity and equality across the business and has targets and actions in place in several areas. KLP wants to be an attractive workplace where all employees feel respected for who they are, regardless of gender, ethnicity, religion, beliefs, disability, sexual orientation, gender identity, gender expression, age and other essential attributes.
UN SUSTAINABLE DEVELOPMENT GOALS
The figures show how KLP contributes towards several of the UN Sustainable Development Goals:
- Goal 5, Gender equality, and especially target 5.1: End all forms of discrimination against all women and girls everywhere; target 5.4: Promote shared responsibility within the household and the family; and target 5.5: Ensure women’s full and effective participation and equal opportunities for leadership.
- Goal 8, Decent work and economic growth, and especially target 8.5: By 2030, achieve equal pay for work of equal value.
- Goal 10, Reduced inequalities, and especially target 10.2: By 2030, empower and promote the social, economic and political inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin, religion or economic or other status.
TARGET
- Gender balance in executive positions and senior professional positions
- Work systematically to achieve a wage balance
- To be a facilitating workplace for workers with disabilities
- Ensure that all employees feel respected for who they are, regardless of gender, religion, beliefs, disability, sexual orientation, gender identity, gender expression, age and other essential attributes
- Raise the average retirement age
Results in 2020
Across all levels of management, the gender balance in 2020 was within the target of 40 per cent of each gender. The gender balance varies across the different management levels, where management level 3 saw an increase in the proportion of women and management level 2 had a small decrease, while the gender balance at management level 1 remained stable from 2019. In senior professional positions (non-executive positions outside the table), where the target is 30 per cent women, there was an increase in the proportion of women in 2020.
In 2020, women earned 83.6 per cent of men’s salaries in KLP, which is a small increase from the previous year (83.5 per cent). Women’s share of men’s pay is mainly influenced by the gender distribution in executive positions and senior professional positions.
Because of the Covid-19 pandemic, it was not practically possible to be a facilitating workplace in 2020. Throughout the year, KLP has carried out several activities to ensure that employees feel respected for who they are, and the employee survey shows high scores in this area.
The average age on leaving the company decreased in 2020, and more people have opted to retire earlier with contractual early retirement pension (AFP) and retirement pension.
| 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets | |
|---|---|---|---|---|---|---|
| Gender distribution among employees (women/men) | 47 / 53 % | 47 / 53 % | 47 / 53 % | 47 / 53 % | 5. | 5.5 |
| Gender distribution management level 1 (women/men) | 30 / 70 % | 30 / 70 % | 30 / 70 % | 30 / 70 % | 5. | 5.5 |
| Gender distribution management level 2 (women/men) | 39 / 61 % | 43 / 57 % | 40 / 60 % | 43 / 57 % | 5. | 5.5 |
| Gender distribution management level 3 (women/men) | 45 / 55 % | 42 / 58 % | 43 / 57 % | 43 / 57 % | 5. | 5.5 |
| Gender distribution, all management levels total (women/men) | 40 / 60 % | 41 / 59 % | 42 / 58 % | 42/58 % | 5. | 5.5 |
| Gender distribution on the Board (women/men) | 50 / 50 % | 50 / 50 % | 50 / 50 % | 50 / 50 % | 5. | 5.5 |
| Gender distribution in the highest paid positions (non-management positions above earnings-table) | 28 / 72 % | 23 / 77 % | 20 / 80 % | 16 / 84 % | 5. | 5.5 |
| Women’s earnings in relation to men’s (all employees at KLP) | 84 % | 84 % | 82 % | 82 % | 5. 8. | 5.1, 5.5, 8.5 |
| Women’s earnings in relation to men’s at management level 1 | 77 % | 76 % | 69 % | 69 % | 5. 8. | 5.1, 5.5, 8.5 |
| Women’s earnings in relation to men’s at management level 2 | 86 % | 84 % | 84 % | 84 % | 5. 8. | 5.1, 5.5, 8.5 |
| Women’s earnings in relation to men’s at management level 3 | 91 % | 90 % | 89 % | 89 % | 5. 8. | 5.1, 5.5, 8.5 |
| Women’s earnings in relation to men’s in the highest paid positions (non-management positions above earnings-table) | 95 % | 91 % | 93 % | 90 % | 5. 8. | 5.1, 5.5, 8.5 |
| Women’s earnings in relation to men’s, remaining employees (not including any management levels or highest paid positions) | 95 % | 95 % | 93 % | 94 % | 5. 8. | 5.1, 5.5, 8.5 |
| CEO's salary in relation to the median salary in the group | 6,00 | New | New | New | n/a | n/a |
| Gender distribution, absence for sick children (women/men) | 47 / 53 % | 51 / 49 % | 50 / 50 % | 51 / 49 % | 5. | 5.1, 5.4 |
| Gender distribution, parental leave taken (women/men) | 65 / 35% | 67 / 33 % | 73 / 27 % | 64 / 36 % | 5. | 5.1, 5.4 |
| Proportion of female employees working part-time | 9 % | 11 % | 12 % | 18 % | 5. 8. | 5.1, 8.5 |
| Proportion of male employees working part-time | 2 % | 3 % | 3 % | 5 % | 5. 8. | 5.1, 8.5 |
| Average retirement age, occupational and old-age pensions (years) | 64,6 | 65,2 | 66,6 | 66,9 | n/a | n/a |
KLP defines managers at three different levels. Management level 1 is the Group management, including the CEO. Management level 2 includes the managers who report directly to an executive vice president (member of Group management). Management level 3 are the managers who report to level 2 managers.
Women’s earnings relative to men’s is defined in the same way as average salary by gender and is calculated from contractual salaries based on full-time employment, not adjusted for the proportion working part-time. The reason women’s average pay is lower than men’s is that the proportion of men in highly-paid positions is higher. KLP does not have any salary differences between the sexes in similar positions.
The CEO’s salary is contractual fixed salary, not including benefits in kind. The median salary is defined as the median salary in the KLP Group for permanent and temporary employees in Norway, and includes management level 1.
Increase knowledge of pensions
KLP aims to be the pension company which takes the best care of its customers. This requires us to help increase knowledge about pensions so our customers and members can make good choices for the days ahead. One way we will do this is by providing good guidance to individuals and disseminating information about pensions in the media.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators show how KLP contributes towards Goal 8, Decent work and economic growth.
TARGET
Help increase knowledge of pensions among our customers and members.
Results in 2020
Personal consultations were affected by the Covid-19 pandemic. In the first half of 2020, it was to a large extent impossible to be physically present to provide individual consultations, and there was little demand from our customers for a digital alternative. Many employees contacted us via telephone instead during this period, and because ad-hoc consultations are not recorded in the same way, the number of consultations may have been under-reported. After the summer, physical consultations were replaced with digital alternatives.
The "Good to know" courses were also affected by the pandemic. There were no refresher courses for municipalities or the health sector, which led to a deacrease in the number of participants. For the corporate segment, refresher courses were held digitally, with 800 participants on 8 courses/sessions.
| 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets | |
|---|---|---|---|---|---|---|
| Number of personal consultations related to pensions | 6 195 | 9 220 | 9 972 | 9 776 | 8. | n/a |
| Participants in the ‘Good to know’ course on pensions | 800 | 955 | 177 | 1 101 | 8. | n/a |
| Media stories about pensions with spokespersons from KLP | 57 | 57 | 53 | 77 | 8. | n/a |
Personal consultations on pensions are meetings KLP has with our customers’ employers and employees on various issues related to pensions.
The “Good to know” course on pensions is a course KLP runs for our customers. KLP runs the courses every two years, with “refresher courses” in the intervening year. The topics covered by the course are employees’ pension rights, reporting to KLP, training in KLP’s online solutions, and the future of public-sector occupational pensions. The courses are an important part of efforts to increase KLP customers’ knowledge of pensions.
Media stories about pensions with a spokesperson from KLP are based on media analyses prepared by Retriever. The figure shows the number of media stories concerning pensions and life insurance where KLP is mentioned, and where the story includes a representative from KLP.
Climate and environment
KLP is working to reduce the environmental impact of its own operations and supports the goal of limiting global warming to 1.5 degree. KLP aims to align its own business and investments with the goals in the Paris Agreement.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators show how KLP supports several of the UN Sustainable Development Goals:
- Target 6.4: Substantially increase water-use efficiency across all sectors.
- Target 7.2: By 2030, increase substantially the share of renewable energy in the global energy mix.
- Target 8.4: Improve progressively, through 2030, global resource efficiency in consumption and production and endeavour to decouple economic growth from environmental degradation.
- Target 9.4: Upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and environmentally sound technologies.
- Target 11.6: By 2030, reduce the adverse environmental impact of cities, paying special attention to air quality and waste management.
- Goal 12, Responsible consumption and production, and especially target 12.5: By 2030, substantially reduce waste generation.
- Goal 13: Climate action
TARGET
- Halve greenhouse gas emissions from our own operations by 2030, based on emissions in 2010.
- Reduce energy consumption in the property portfolio to 180 kWh per square metre.
- On average, the proportion of waste sorted at source should be more than 65 per cent and not be below 50 per cent in any property in the property portfolio.
Results in 2020
The ongoing Covid-19 pandemic had a big impact on the way we worked in 2020. Following the national lockdown in March, KLP introduced a home office scheme for all employees and tight restrictions on business travel. This led to a drastic decrease in the number of flights and in the activity levels in KLP’s own offices. The decline in air travel, energy consumption and waste, and increased waste sorting, can therefore mainly be attributed to the pandemic. These activities are expected to increase again as society transitions back to more normal conditions.
Because of the reduced level of activity, the pandemic has also led to a sharp reduction in emissions from KLP’s own operations. Emissions have decreased by 72 per cent since 2019, and by 82 per cent compared to 2010. Although the pandemic is likely to cause some lasting changes to our habits and ways of working (in terms of business trips and meetings, for example), emissions are expected to increase again in 2021. However, the trend in recent years suggests that KLP is well on track to meet its 2030 target.
The infection control measures during the pandemic have also affected activity in KLP’s property portfolio, which includes office buildings, shopping malls and hotels. This has also resulted in reduced energy consumption and waste volume. The energy consumption in the property portfolio has been reduced from 190 to 167 kWh per square metre, so the target of 180 kWh per square metre has been achieved. The target of a 65 per cent sorting rate for waste in the property portfolio has not been achieved, but good progress has been made, reaching 62 per cent. One of the reasons for this is that the amount of waste was less in 2020.
| 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets | |
|---|---|---|---|---|---|---|
| Activity data from KLP's own operations | ||||||
| Number of flights (total / per work-year) | 1 302 / 1,3 | 6 483 / 6,6 | 6 661 / 6,8 | 3 107 / 3,3 | 12.13. | n/a |
| Energy consumption in KLP’s own offices (kWh per m2) | 94 | 113 | 129 | 130 | 9. 13. | 9.4 |
| Quantity of waste in KLP's own offices (tonnes / kg per work-year) | 101 / 0,10 | 132 / 0,13 | 132 / 0,14 | 128 / 0,14 | 11. 12. | 11.6, 12.5 |
| Recycling rate at source in KLP’s own offices | 56 % | 61 % | 64 % | 68 % | 11. 12. | 11.6, 12.5 |
| Proportion of environmentally certified suppliers | 61 % | - | - | - | ||
| Activity data from KLP's property portfolio | ||||||
| Energy consumption in KLP's property portfolio (kWh per m2) | 167 | 190 | 200 | 191 | 9. | 9.4 |
| Quantity of waste in KLP's property portfolio (tonnes) | 4 296 | 5 553 | 5 760 | 5 826 | 11. 12. | 11.6, 12.5 |
| Recycling rate at source in KLP’s property portfolio | 62 % | 55 % | 54 % | 55 % | 11. 12. | 11.6, 12.5 |
| Water consumption in KLP’s property portfolio (millions of litres) | 258 | 436 | 442 | 453 | 6. | 6.4 |
| Renewable energy production in KLP’s property portfolio (MWh) | 619 | 403 | 195 | 187 | 7. 9. | 7.2, 9.4 |
| Greenhouse gas emissions | ||||||
| Greenhouse gas emissions from KLP's own operations (tonnes CO2e) | 280 | 989 | 1 073 | 1 014 | 12. 13. | n/a |
| Scope 1 (tonnes) | 2 | 5 | 7 | 6 | 12. 13. | n/a |
| Scope 2 (tonnes) | 81 | 99 | 123 | 142 | 12. 13. | n/a |
| Scope 3 (tonnes) | 197 | 885 | 943 | 866 | 12. 13. | n/a |
| - Flights (tonnes / tonnes per work-year) | 154 / 0,15 | 810 / 0,82 | 865 / 0,89 | 791 / 0,84 | 12. 13. | n/a |
| - Business travel by car (tonnes / tonnes per work-year) | 20 / 0,02 | 48 / 0,05 | 53 / 0,05 | 52 / 0,05 | 12. 13. | n/a |
| - Waste (tonnes / tonnes per work-year) | 23 / 0,02 | 27 / 0,03 | 26 / 0,03 | 23 / 0,02 | 12. 13. | n/a |
| Greenhouse gas emissions from KLP's property portfolio (tonnes CO2e) | 7 866 | 9 402 | 10 560 | 10 210 | 12. 13. | n/a |
| Scope 1 (tonnes) | 1 | 71 | 114 | 101 | 12. 13. | n/a |
| Scope 2 (tonnes) | 6 965 | 8 024 | 9 054 | 8 660 | 12. 13. | n/a |
| Scope 3 (tonnes) | 901 | 1 308 | 1 392 | 1 449 | 12. 13. | n/a |
| Total greenhouse gas emissions from KLP's property portfolio per kvm | 0,008 | 0,009 | 0,011 | 0,010 | ||
| Greenhouse gas emissions from KLP's securities investments (tonnes CO2e) | 5 648 610 | - | - | - | 12. 13. | n/a |
| Scope 1-2 | 1 506 364 | - | - | - | 12. 13. | n/a |
| Scope 3 | 4 142 246 | - | - | - | 12. 13. | n/a |
| Total greenhouse gas emissions for KLP | 5 656 756 | 10 391 | 11 633 | 11 224 | 12. 13. | n/a |
| Scope 1 | 2 | 5 | 7 | 6 | 12. 13. | n/a |
| Scope 2 | 81 | 99 | 123 | 142 | 12. 13. | n/a |
| Scope 3 (property and securities investments) | 5 656 673 | 10 287 | 11 504 | 11 076 | 12. 13. | n/a |
Activity data from KLP’s own operations
Flights
The number of flights is based on figures from our travel agency, and it is the number of individual stretches that is reported. A stretch means a single flight, and a round-trip journey may consist of several stretches. KLP switched travel agencies after the third quarter of 2020, but the same methodology has been used to calculate flights in the fourth quarter.
Because of the pandemic, many trips were cancelled or not completed. This has been adjusted for, and the number shows flights actually completed and travelled.
Energy consumption
Energy consumption is a major source of KLP’s greenhouse gas emissions. The energy consumption in KLP’s own office premises is not temperature-adjusted but shows actual usage. ‘Own office premises’ are the offices where the KLP Group’s employees work. Energy consumption is derived from our energy monitoring system.
Waste
The amount of waste in KLP’s own office premises includes Oslo, Bergen and Trondheim. The waste scale at KLP’s office in Oslo was out of order for much of 2020. Therefore, the amount of waste is based on the volumes of waste in previous years and adjusted for the general decrease in waste in KLP’s property portfolio as a result of the pandemic.
The degree of waste sorting shows the proportion of waste sorted at source. A greater proportion of sorted waste can be recycled, so it has a less harmful impact on the environment than waste which is not sorted and is either dumped in landfill or used to produce energy.
Share of environmentally certified suppliers
The reported figure gives the share of purchases from large Norwegian suppliers to KLP which are environmentally certified under the ‘Eco-Lighthouse’ scheme (“Miljøfyrtårn”) or ISO 14001. Large suppliers are defined as suppliers where KLP’s purchases amount to NOK 1 million or more during the financial year.
The reporting covers external suppliers who provide goods or services directly to KLP’s financial operations. Suppliers from within the KLP Group and suppliers to the property company or the non-life insurance company are not included.
KLP had a total of 82 suppliers with turnover above NOK 1 million in 2020. Of these, 26 were environmentally certified. This means that 32 per cent of the suppliers were certified. Purchases from the environmentally certified suppliers accounted for 61 per cent of total purchases from suppliers over NOK 1 million.
Activity data from KLP's property portfolio
Energy consumption
The reported figures are the 12-month average climate-adjusted specific energy use for KLP-operated buildings.
‘KLP-operated buildings’ are the properties which KLP owns, operates and maintains, where KLP is able to implement environmental measures and measure their effects. These are buildings in Oslo, Trondheim, Copenhagen and Stockholm. All of these buildings have energy monitoring systems in which energy and water consumption is recorded and monitored. In the vast majority of buildings, the tenants’ energy consumption is also included, so we have an overview of total energy consumption for the buildings.
Energy consumption in kWh per m2 per year for KLP-operated buildings has been temperature-adjusted in order to measure the effect of the energy-saving measures.
The company has a large portfolio of buildings, which also changes over time. The individual buildings can also change their consumption patterns over shorter or longer periods, e.g. in connection with changes of tenant.
There may be various reasons why it is sometimes impossible to obtain correct figures, such as faults in meters or figures reported late by our sub-contractors. Hence, the reporting will only include KLP-operated buildings where operating conditions are consistent going back 12 months from the reporting date. In effect, the buildings included in the reporting might vary slightly from year to year. Nevertheless, we believe this will reflect the correct trends in the company’s property portfolio.
Waste
The quantity of waste in KLP’s property portfolio includes KLP-operated buildings, except for the buildings in Stockholm where the waste is not weighed on collection.
The degree of waste sorting shows the proportion of waste sorted at source. A greater proportion of sorted waste can be recycled, so it has a less harmful impact on the environment than waste which is not sorted and is either dumped in landfill or used to produce energy.
Water consumption
It is actual water consumption in millions of litres in KLP-operated buildings that is reported.
Renewable energy production in KLP’s property portfolio
The number reported is total kWh of renewable energy produced locally at KLP’s properties.
Greenhouse gas emissions
Greenhouse gas emissions from KLP’s own operations
The GHG emissions inventory for KLP’s own operations is prepared by an external consultant. The emissions are converted into tonnes of CO2 equivalents in line with the standard from the Greenhouse Gas Protocol Initiative. Greenhouse gas emissions include emissions from the use of diesel cars (scope 1), energy consumption (scope 2), and flights, business travel by car, and waste from KLP’s own office premises (scope 3). When calculating greenhouse gas emissions from air travel, we differentiate between short, medium and long-haul and by cabin class. We also include an RF factor (“radiative forcing”) in the calculation.
In 2020, computer equipment and monitors were purchased to enable employees to work from home. These are products which produce significant emissions. As KLP currently does not include procurement in our scope 3 emissions, emissions from these products are not included in the GHG emissions inventory. However, KLP is working to include procurement in the GHG emissions inventory in the long term.
Greenhouse gas emissions from KLP’s property portfolio
The GHG emissions inventory for KLP’s property portfolio is prepared by an external consultant. The calculation includes KLP-operated buildings. The emissions are converted into tonnes of CO2 equivalents in line with the standard from the Greenhouse Gas Protocol Initiative. Greenhouse gas emissions include energy consumption, waste and general operation of the properties. Greenhouse gas emissions from KLP’s property portfolio are included in scope 3 within KLP’s overall greenhouse gas emissions.
Greenhouse gas emissions from KLP’s securities investments
Emissions from KLP’s securities investments are calculated using figures from our data provider. It is KLP-owned emissions that are reported. This means that KLP-owned emissions are allocated from the company’s total emissions according to KLP’s stake in the company based on KLP’s equity and bond holdings and the value of the company. Greenhouse gas emissions from KLP’s securities investments are included in scope 3 within KLP’s total greenhouse gas emissions.
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Responsible business operations
KLP aims to operate in a responsible manner to ensure that our customers receive the pensions and services they are entitled to. It is important to us that our owners and their employees are satisfied, and therefore we are transparent about when we receive complaints.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators show how KLP supports several of the UN Sustainable Development Goals:
- Goal 8, Decent work and economic growth
- Goals 10, Reduced inequalities
- Goal 16, Peace, justice and strong institutions, and especially target 16.6: Develop effective, accountable and transparent institutions at all levels.
TARGET
Targets not defined or relevant.
| 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets | |
|---|---|---|---|---|---|---|
| Fees and fines from authorities due to non-compliance with laws and regulations | 0 | - | - | - | 16. | 16.6 |
| Concerns received via external whistleblowing channel | 0 | - | - | - | 16. | n/a |
| KLP | ||||||
| Complaints received via KLP's contact points | 1 018 | - | - | - | 8. 10. | n/a |
| Cases processed in the National Insurance Court (number / number where the customer has been upheld) | 45 / 0 | - | - | - | 8. 10. | n/a |
| KLP Banken | ||||||
| Complaints received via KLP's contact points (number / number where the customer has been upheld) | 3 / 0 | - | - | - | 8. | n/a |
| Cases processed in the Norwegian Financial Services Complaints Board (number / number where the customer has been upheld) | 0 / - | - | - | - | 8. | n/a |
| KLP Kapitalforvaltning | ||||||
| Complaints received via KLP's contact points (number / number where the customer has been upheld) | 20 / 17 | - | - | - | 8. | n/a |
| Cases processed in the Norwegian Financial Services Complaints Board (number / number where the customer has been upheld) | 0 / - | - | - | - | 8. | n/a |
| KLP Skadeforsikring | ||||||
| Complaints received via KLP's contact points (number / number where the customer has been upheld) | 164 / 18 | - | - | - | 8. | n/a |
| Cases processed in the Norwegian Financial Services Complaints Board (number / number where the customer has been upheld) | 36 / 6 | - | - | - | 8. | n/a |
| The indicators in this table are new in 2020, and KLP has not reported these figures before. Historical figures have therefore been replaced by -. | ||||||
Official fees and fines
This indicator shows the amount paid in fees and fines from authorities due to non-compliance with laws and regulations. This includes fees from the Financial Supervisory Authority of Norway (“Finanstilsynet”), the Norwegian Data Protection Authority (“Datatilsynet”), the Labour Inspection Authority (“Arbeidstilsynet”) and the Norwegian Competition Authority (“Konkurransetilsynet”), fines from prosecuting authorities and fines imposed by the courts. In 2020, KLP did not incur any such fees or fines.
Concerns via external whistleblowing channel
KLP has an external whistleblowing channel where people also anonymously can report concerns. The reported figure is the number of actual concerns received via this channel. KLP received no such concerns in 2020.
Complaints via KLP contact points
Most complaints to KLP come via our own contact points, such as the contact form on klp.no, email, phone-calls and conversations with customer service staff in the different parts of the business. The number of complaints reported is the number reported to the Financial Supervisory Authority of Norway and considered to be actual complaints.
For KLP Skadeforsikring, KLP Banken and KLP Kapitalforvaltning we also report the number of complaints where customers have had all or part of their complaint upheld after KLP reconsidered the matter. It has not been possible to obtain equivalent figures for complaints to KLP related to pensions, because of limitations in the system. We will attempt to report the number of cases where the complaint was upheld for next years reporting.
Cases in the National Insurance Court
The indicator shows the number of cases processed in the National Insurance Court (“Trygderetten”) in 2020 and the number of cases where the customer was fully or partially upheld. The processing time in the National Insurance Court is 8 to 10 months, so the figure includes cases that were submitted to the Court in both 2019 and 2020.
Cases before the Financial Services Complaints Board
If one of our customers has submitted a complaint to KLP and is not satisfied with the response or the follow-up, the complaint can be referred to the Norwegian Financial Services Complaints Board (“Finansklagenemnda”). The indicator shows the number of cases processed in the Financial Services Complaints Board in the year and the number of cases where the customer was fully or partially upheld where KLP Banken, KLP Kapitalforvaltning or KLP Skadeforsikring were the counterparty.
Tax and income per country
A responsible business is open about its tax practices. KLP therefore reports on tax where we operate on a country-by-country basis.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators show how KLP supports several of the UN Sustainable Development Goals:
- Target 10.4: Adopt policies, especially fiscal, wage and social protection policies, and progressively achieve greater equality
- Goal 16, Peace, justice and strong institutions, especially target 16.4: By 2030, significantly reduce illicit financial and arms flows; and 16.5: Substantially reduce corruption and bribery in all their forms.
TARGET
Targets not defined or relevant.
| 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets | |
|---|---|---|---|---|---|---|
| Norway | ||||||
| Employees (work-years) | 997 | 985 | 973 | 944 | 16. | 16.4, 16.6 |
| New investments in property (MNOK) | 2 406 | 1 989 | 983 | 404 | 16. | 16.4, 16.6 |
| Income (MNOK) | 75 625 | 105 705 | 46805 | 69571 | 16. | 16.4, 16.6 |
| Accounting income before taxes (MNOK) | 1 657 | 2 477 | 1719 | 1458 | 16. | 16.4, 16.6 |
| Actual income tax payable for the financial year (MNOK) | 0 | 0 | 0 | 0 | 16. | 16.4, 16.6 |
| Sweden | ||||||
| Employees (work-years) | 11 | 10 | 8 | 8 | 16. | 16.4, 16.6 |
| New investments in property (MNOK) | 78 | 15 | 7 | 2 | 16. | 16.4, 16.6 |
| Income (MNOK) | 404 | 450 | 437 | 448 | 16. | 16.4, 16.6 |
| Accounting income before taxes (MNOK) | 38 | 290 | 883 | 916 | 16. | 16.4, 16.6 |
| Actual income tax payable for the financial year (MNOK) | 30 | 10,6 | 0 | 0 | 16. | 16.4, 16.6 |
| Denmark | ||||||
| Employees (work-years) | 13 | 12 | 9 | 9 | 16. | 16.4, 16.6 |
| New investments in property (MNOK) | 682 | 3 617 | 1115 | 28 | 16. | 16.4, 16.6 |
| Income (MNOK) | 442 | 313 | 255 | 232 | 16. | 16.4, 16.6 |
| Accounting income before taxes (MNOK) | 245 | 321 | 250 | 101 | 16. | 16.4, 16.6 |
| Actual income tax payable for the financial year (MNOK) | 31 | 19,5 | 2 | 1,8 | 16. | 16.4, 16.6 |
| Rest of Europe | ||||||
| Employees (work-years) | 0 | 0 | 0 | 0 | 16. | 16.4, 16.6 |
| New investments in property (MNOK) | 0 | 308 | 0 | -81 | 16. | 16.4, 16.6 |
| Income (MNOK) | 36 | 166 | 263 | 79 | 16. | 16.4, 16.6 |
| Accounting income before taxes (MNOK) | -451 | 105 | -12 | -2 | 16. | 16.4, 16.6 |
| Actual income tax payable for the financial year (MNOK) | 0 | 0,1 | 0 | 0,1 | 16. | 16.4, 16.6 |
KLP reports tax and income broken down across the countries in which KLP operates entities with a controlling influence. This means that tax and income from investments in foreign securities are reported as Norwegian in the country breakdown, unless KLP has a controlling influence over the investment such that there is a group relationship. The amount includes KLP’s withholding tax on fund investments. In practice, KLP’s business activities abroad are concerned with investments in property.
For new investments, it is net new investments for the year is reported, not the balance.
Tax here refers to income tax. Taxes in the form of indirect tax are not included in the reported figures.
Transparency about invstments
As the pension company for Norwegian municipalities and the health sector, KLP is transparent about the way we invest the pension assets that we manage. KLP has investments in more than 8,000 companies around the world, divided into different sectors and regions, and in government bonds issued by different countries. You can read more here:
- KLP's investments in shares and equity funds in Norway and abroad and broken down by sector (See note 15 in KLP Annual Accounts)
- KLP’s investments in equities and bonds, by sector and region
- KLP’s investments in government bonds, by country
Increasing investments that promote sustainable development and support our financial goalsSTRATEGIC OBJECTIVE
Increase climate-friendly investments
KLP’s investments promote many different aspects of sustainable development, but given KLP’s focus on climate change, we are particularly committed to climate-friendly investments. KLP wants to steer its capital in a climate-friendly direction by setting specific targets for selected investments.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators show how KLP supports several of the UN Sustainable Development Goals:
- Goal 7, Affordable and clean energy, including target 7.1: By 2030, ensure universal access to reliable and modern energy services; target 7.2: By 2030, increase substantially the share of renewable energy in the global energy mix; and target 7.a: By 2030, enhance international cooperation to facilitate access to clean energy research and technology.
- Goal 9, Industry, innovation and infrastructure, especially target 9.a: Facilitate sustainable and resilient infrastructure development in developing countries through enhanced financial, technological and technical support; and 9.4: By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies.
- Target 15.2: By 2020, promote the implementation of sustainable management of all types of forests, halt deforestation, restore degraded forests and substantially increase afforestation and reforestation globally.
- Target 17.3: Mobilize additional financial resources for developing countries from multiple sources.
TARGET
Increase KLP’s climate-friendly investments by NOK 6 billion per year.
Results in 2020
In 2020, climate-friendly investments increased by NOK 8.77 billion. This includes investments in renewable energy in Norway and abroad, buildings with environmental qualities, and green loans to municipalities and county councils.
| MILLION NOK | 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets |
|---|---|---|---|---|---|---|
| Renewable energy in Norway | 23 074 | 23 258 | 23 013 | 22 282 | 7. | 7.2 |
| Renewable energy internationally | 6 698 | 3 127 | 1 644 | 1 088 | 7. | 7.2, 7.a |
| Renewable energy in developing countries | 932 | 725 | 483 | 381 | 7. 9. 17. | 7.1, 7.2, 7.a, 9.a, 17.3 |
| Buildings with environmental qualities in the property portfolio | 13 273 | 14 197 | 11 985 | 10 115 | 9. | 9.4 |
| Green bonds | 1 881 | 890 | 792 | 735 | n/a | n/a |
| Other climate-friendly investments | 6 328 | 295 | 124 | n/a | 7. 9. 15. 17. | 15.2 |
| Total | 52 186 | 42 493 | 38 040 | 34 601 | 7. 9. 15. 17 | 7.1, 7.2, 7.a, 9.a, 9.4, 15.2, 17.3 |
| As a share of KLP's total investments | 8 % | 7 % | 7 % | 6 % | n/a | n/a |
| Renewable energy (market value) | 32 687 | 29 748 | 27 727 | 23 751 | 7. | 7.1, 7.2 |
| Renewable energy (as a share of KLP's total investments) | 5 % | 5 % | 5 % | 4 % | 7. | 7.1, 7.2 |
| Fossil energy (market value) | 7 818 | 10 823 | 10 443 | 11 215 | n/a | n/a |
| Fossil energy (as a share of KLP's total investments) | 1 % | 2 % | 2 % | 2 % | n/a | n/a |
| Buildings with environmental qualities in the property portfolio (m2) | 309 342 | 319 957 | 283 980 | 236 678 | 9. | 9.4 |
| Buildings with environmental qualities in the property portfolio (as a share of the portfolio) | 17 % | 18 % | 16 % | 14 % | n/a | n/a |
| Buildings with environmental qualities in the property portfolio (market value) | 13 273 | 14 197 | 11 985 | 10 115 | 9. | 9.4 |
| Buildings with environmental qualities in the property portfolio (as a share of the portfolio) | 16 % | 19 % | 18 % | 16 % | n/a | n/a |
It is the market value of the investments in NOK millions that is reported.
The forthcoming EU taxonomy received a lot of attention in 2020. The taxonomy is a classification system that will be used to define sustainable economic activity. It will therefore have a major impact on KLP and how we classify our investments. The full regulations were expected at the start of 2021 but have been postponed. To prepare for the taxonomy, KLP has studied the draft regulations and tried to assess our investments against the criteria. Due to a lack of data, the assessments mainly relate to direct investments in renewable energy and power and lending to projects in renewable energy, water and sewerage, transport and real estate. When the final EU regulations are in place, KLP will reassess our definition and will continue to do so regularly in connection with our reporting. This will require more and better data on our investments.
Renewable energy in Norway
Renewable energy in Norway means equity and bond investments in Norwegian energy generation and distribution companies. The energy companies are classified as electricity producers from hydro-electric or wind power or bio-fuels. The figure also includes lending to companies and projects in Norway in the power sector, which was not included before. The figure is therefore not directly comparable to previous years.
Renewable energy internationally
Renewable energy internationally covers investments in renewable energy projects. These are both equity investments and project financing. The investments are made either through external fund managers specialising in energy or through other partners.
Renewable energy in developing countries
Renewable energy in developing countries covers investments in new renewable energy projects. The investments are made partly as direct investments in cooperation with Norfund, and partly as fund investments through the fund manager Climate Investor One. The investments are part of KLP’s portfolio of development investments, which is one of the measures in the Guidelines for KLP as a responsible investor. The aim is to achieve both financial returns and benefits to society. The investments are based on commercial risk and return assessments, but also emphasise the effect on social and environmental parameters.
Buildings with environmental qualities
It is the market value of buildings with environmental qualities in KLP’s property portfolio and the total number of square metres that is reported. Buildings with environmental qualities are defined as buildings with energy class A or B. This is following the proposed classification criteria in the EU taxonomy and input to this from Finance Norway, among others. In the past, the definition also included buildings that are BREEAM certified with a minimum rating of very good, that produce their own energy through solar panels, or that have won a Norwegian property prize where environment is an important measurement parameter. The updated definition is therefore stricter and includes fewer buildings. The figures from previous years have not been updated to conform to the new definition, so the figures are not directly comparable.
Green bonds
The market value includes bonds that are classified as green and not already included in KLP’s investments in renewable energy in Norway as described above.
Other climate-friendly investments
Climate-friendly investments that do not fall into one of the main categories above are placed here. This includes loans for electric ferries and investments in a fund that invests in FSC-certified forest properties. This year, the figures also include publicly traded energy companies outside Norway which generate electricity mainly from renewable sources, and green loans to municipalities, county councils and enterprises with a municipal affiliation. The loan must have a clearl positive environmental and climate effect and satisfy certain criteria, and the project must relate to water, sewerage and waste disposal, transport or new construction and refurbishment of buildings. Green loans and international energy companies have not been included in the category “Other climate-friendly investments” in previous years, so the figure is not directly comparable to historical figures.
Share of KLP’s total investments
The share represents the investment as a percentage of KLP’s total investments.
Investments in publicly traded companies that KLP invests in through our index-tracking or global bond portfolios are excluded from this definition of climate-friendly investments, with the exception of green bonds and a few international energy companies.
Fossil energy
The figure is the market value of KLP’s investments in companies classified as oil and gas companies, including exploration, production and refineries. Transport and oil industry service companies are not included.
Climate profile of the investments
To raise awareness of the climate impact of investments and highlight developments over time, KLP measures and reports the climate profile of the investments. By reporting various indicators, KLP hopes to provide a good overall view of the impact of the investments on carbon emissions and carbon risk.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators show how KLP supports UN Sustainable Development Goal 13, Climate action.
TARGET
Targets not defined or relevant. KLP does not use the climate profile as a control parameter or as a basis for decision-making, but the indicators allow us to extract information and monitor developments in the portfolios over time.
| AGAINST WEIGHTED REFERENCE INDEX IN BRACKETS | Scope 1 og 2 | Scope 1, 2 og 3 | UN Sustainable Development Goals | SDG targets |
|---|---|---|---|---|
| Weighted average carbon intensity (tCO2e per mUSD) | 115 (188) | 493 (717) | 13. | n/a |
| Carbon intensity (tCO2e per mUSD revenue) | 171 (204) | 641 (712) | 13. | n/a |
| Carbon footprint (tCO2e per mUSD invested) | 68 (85) | 256 (297) | 13. | n/a |
| Greenhouse gas emissions (tonnes CO2e) | 1 506 364 | 5 648 610 | 13. | n/a |
KLP reports according to the recommendations from TCFD and reports on the four recommended indicators for carbon measurement of investments. The definition of the indicators varies across different sources, and even varies within the EU regulations. For 2020, KLP has chosen to adopt best practice from the various regulations, and has therefore made extensive changes to the method we use to calculate the climate profile of our investments:
- The climate indicators include both listed shares and corporate bonds, where KLP previously only included shares.
- To calculate carbon intensity, carbon footprint and carbon emissions, we use “enterprise value", which includes a company’s stock value and debt. In previous years, we used the market value of a company, which includes only shares. KLP does not have access to historical data on enterprise value, so it has not been possible to calculate the indicators for previous years with the new method.
- The climate indicators are calculated for scope 1 and 2 and for scope 1, 2 and 3.
- Following TCFD’s definition, the calculations are made in US dollars.
KLP obtains data on emissions, revenues and enterprise value from our data provider and calculates the indicators internally. Because of delays in reporting from companies KLP is invested in, company data from 2019 has been used to calculate the climate indicators for KLP for 2020.
Similar calculations have also been made for a weighted reference index. This number shows how the figures might look if the funds were invested in a broad market index.
Data is not available for all investments. KLP therefore calculates the coverage for the indicators, i.e. the proportion of listed shares and corporate bonds for which the necessary data is available. The coverage for the various indicators is shown in the table below:
| Indicator | Coverage |
|---|---|
| Weighted average carbon intensity | 56,1 % |
| Carbon intensity | 44,2 % |
| Greenhouse gas emissions | 44,2 % |
| Carbon footprint | 44,2 % |
Weighted average carbon intensity
Weighted average carbon intensity shows the exposure of the portfolios to carbon-intensive companies. The indicator is calculated as tonnes of CO2 equivalents per million dollars the company has in revenue, weighted for that company’s share in the portfolio.
Greenhouse gas emissions
It is KLP’s owned emissions that are reported. This means that KLP-owned emissions are allocated from the company’s total emissions based on KLP’s stake in the company and its enterprise value. The portfolio’s total investments in the company are divided by the company’s total value (value of shares and debt) to derive the ownership interest.
Carbon intensity
The carbon intensity shows the carbon efficiency of investments. The indicator is calculated as tonnes of owned CO2 equivalents per million dollars the company has in revenue, i.e. the quantity of emissions owned by the portfolio in relation to income owned by the portfolio. The portfolio’s total investments in the company are divided by the company’s total value (value of shares and debt) to derive the ownership interest.
Carbon footprint
The carbon footprint shows the quantity of emissions owned relative to the size of the portfolio, i.e. how large a carbon footprint the portfolio has, taking account of its size. The indicator is calculated as tonnes of owned CO2 equivalents divided by the market value of the portfolio. The portfolio’s total investments in the company are divided by the company’s total value (value of shares and debt) to derive the ownership interest.
New renewable energy capacity
More renewable energy, especially in developing countries, is essential to achieve the climate goals and to ensure that the future energy system is sustainable. Increased access to energy has a number of positive effects on social development and growth and is one of the keys to sustainable development in developing countries.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators show how KLP supports several of the UN Sustainable Development Goals:
- Goal 7, Affordable and clean energy, including target 7.1: By 2030, ensure universal access to reliable and modern energy services; and target 7.2: By 2030, increase substantially the share of renewable energy in the global energy mix.
- Goal 13, Climate action
- Goal 15, Life on land
TARGET
Continuous increase in the number of projects and installed capacity.
Results in 2020
In 2020, KLP contributed to the construction of one project totalling 246 MW.
Because of delays in reporting from the investments to KLP, not all projects completed in 2019 were included in the annual report for 2019. The increase from 2020 to 2019 therefore includes both projects completed in 2020 and some projects completed in 2019.
| 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets | |
|---|---|---|---|---|---|---|
| Number of completed renewable energy projects | 25 | 14 | 8 | 5 | 7. | 7.1, 7.2 |
| New renewable energy capacity brought to the market (MW) | 3 604 | 1 918 | 945 | 574 | 7. | 7.1, 7.2 |
| The number of residents’ energy needs covered by the new capacity | 7 571 445 | 6 989 649 | 6 255 616 | 642 830 | 7. | 7.1, 7.2 |
| CO2 emissions avoided as a result of the new capacity (tonnes) | 3 467 678 | 1 987 160 | 949 036 | 780 786 | 7. 13. 15 | 7.1, 7.2 |
The projects included are KLP’s investments dedicated to the construction of new renewable energy capacity. This includes direct investment in projects and companies, fund investments and loans for projects.
Number of completed projects
The number of completed projects, and their total installed capacity, is cumulative since the start of the investments. The figures refer to the projects as a whole; KLP’s stake is not taken into account.
Number of resident’s energy needs covered by the new capacity
The renewable energy projects that KLP has invested in produce electricity equivalent to the needs of a given number of residents in the countries where the generation facilities are in operation. The calculation is based on the average capacity of the respective technologies obtained from the Intergovernmental Panel on Climate Change, and the average electricity consumption per capita in the country in question taken from the World Bank’s statistics database. The figures for Rwanda are based on data from worlddata.org and the CIA Factbook.
CO2 emissions avoided as a result of the new capacity
The emissions theoretically avoided if the same amount of electricity had been generated by the country’s average electricity generation. The figures are taken from the International Energy Agency (IEA). For Rwanda, the figures are based on reporting by the authorities to the UN Convention on Climate Change, reconciled against the African Carbon Forum. This gives a conservative estimate of the reduction in CO2 emissions.
Finance in developing countries
Underdeveloped financial institutions and lack of access to financial services such as savings, loans and insurance for the population are hindering efforts to reduce poverty in developing countries. Through our investments in finance in developing countries, KLP aims to contribute to economic growth and better living conditions.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators show how KLP supports several of the UN Sustainable Development Goals:
- Target 1.4: By 2030, ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, appropriate technology and financial services, including microfinance.
- Target 5.a: Undertake reforms to give women equal rights to economic resources, as well as access to ownership and control over land and other forms of property, financial services, inheritance and natural resources.
- Target 8.3: Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small- and medium-sized enterprises, including through access to financial services; and target 8.10: Strengthen the capacity of domestic financial institutions to encourage and expand access to banking, insurance and financial services for all.
- Target 9.3: Increase access of small-scale industrial and other enterprises, in particular in developing countries, to financial services, including affordable credit.
- Target 11.1: By 2030, ensure access for all to adequate, safe and affordable housing and basic services and upgrade slums.
- Target 17.3: Mobilize additional financial resources for developing countries from multiple sources.
TARGET
Increase this type of investment and thus contribute to economic growth and better living conditions in developing countries.
Results in 2020
KLP’s investments in banking and finance in developing countries decreased in 2020. This is mainly due to a decrease in the market value of the investments.
| 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets | |
|---|---|---|---|---|---|---|
| Banking and finance in developing countries (MNOK) | 665 | 713 | 570 | 530 | 1. 5. 8. 9. 11. 17 | 1.4, 5.a, 8.3, 8.10, 9.3, 11.1, 17.3 |
| Borrowers in developing countries through the Nordic Microfinance Initiative (figures in millions) | 9,8 | 8,9 | 8,1 | 6,6 | 1. 5. 8. 9. 11. | 1.4, 5.a, 8.3, 8.10, 9.3, 11.1 |
Investments in banking and finance
Investments in banking and finance in developing countries are KLP’s investments in the Norwegian Microfinance Initiative (NMI) and NorFinance. NorFinance is an investment company that KLP owns together with Norfund, among others. The investments are made as part of KLP’s development investment portfolio, which is one of the instruments in the Guidelines for KLP as a responsible investor. The aim is to achieve both financial returns and benefits to society.
Borrowers in developing countries
Borrowers in developing countries through the Nordic Microfinance Initiative (NMI) are active borrowers through the microfinance institutions that the NMI has invested in. The number represents the microfinance institutions as a whole; NMI’s stake in any given microfinance institution is not taken into account. Of the 9.8 million borrowers, 94 per cent are women, and 81 per cent of borrowers live in rural areas.
Seed investments
KLP wants to ensure that good ideas can be pursued locally and create jobs in Norway. By investing in innovation, KLP aims to contribute to local wealth creation and the green transformation in Norway.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators support e.g. UN Sustainability Goal 8, Decent work and economic growth, particularly target 8.3: Support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small- and medium-sized enterprises, including through access to financial services.
TARGET
Increase this type of investment and thus contribute to innovation.
Results in 2020
In 2020, KLP invested in five new Norwegian seed investment funds, and the market value of these investments increased to NOK 125 million.
| MILLION NOK | 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets |
|---|---|---|---|---|---|---|
| Seed investments in Norway | 125 | 8 | 4 | - | 8. | 8.3 |
It is the market value of investments made that is reported. In 2018, KLP established a portfolio of investments in seed investment funds related to research environments in Norway. At the end of 2020, KLP had invested in 10 different funds.
Engaging companies and industries for a more sustainable operationSTRATEGIC OBJECTIVE
Engaged and responsible owner
KLP is an engaged and responsible owner which seeks to influence individual companies, industries and markets.
UN SUSTAINABLE DEVELOPMENT GOALS
As a responsible investor and owner, KLP has discussions with companies on many topics related to the UN Sustainable Development Goals. KLP’s exclusion criteria are also consistent with the SDGs. The indicators show how KLP supports several of the SDGs:
- Target 3.a: Strengthen the implementation of the World Health Organization Framework Convention on Tobacco Control in all countries.
- Goal 5, Gender equality
- Goal 7, Affordable and clean energy
- Target 8.7: Take immediate and effective measures to eradicate forced labour, end modern slavery and human trafficking and secure the prohibition and elimination of the worst forms of child labour.
- Target 12.6: Encourage companies to adopt sustainable practices and to integrate sustainability information into their reporting cycle.
- Goal 14, Life below water
- Goal 15, Life on land
- Target 16.2: End abuse, exploitation, trafficking and all forms of violence against and torture of children; target 16.4: By 2030, significantly reduce illicit financial and arms flows; and target 16.5: Substantially reduce corruption and bribery in all their forms.
TARGET
- KLP aims to vote at 95 per cent of the general meetings both in Norway and abroad.
- KLP aimed to follow up 240 companies in 2019.
Results in 2020
KLP has voted at 97 per cent of the general meetings of Norwegian companies and at 96 per cent of the general meetings of foreign companies. We have therefore achieved our targets by a good margin.
In 2020, KLP switched service providers to one that does not offer dialogue as a service. Follow-up of companies has therefore only been through direct dialogue between KLP and companies. A total of 362 companies were followed up on topics related to ESG. This is a marked increase from last year, which is due both to improved internal procedures for following up on company discussions, and the fact that the pandemic has reduced meetings and travel and so made more time available for dialogue.
| 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets | |
|---|---|---|---|---|---|---|
| Companies excluded from investments | 560 | 534 | 189 | 174 | All SDGs | 3.a, 8.7, 12.6, 16.2, 16.4, 16.5 |
| Share of companies excluded from the MSCI World Index | 6,3 % | 7,9 % | ny | ny | n/a | n/a |
| Share of companies excluded from the Bloomberg Barclays Global Corporates Index | 9,4 % | 9,5 % | ny | ny | n/a | n/a |
| Companies re-included in the investments | 4 | 13 | 2 | 5 | All SDGs | 3.a, 8.7, 12.6, 16.2, 16.4, 16.5 |
| General meetings of Norwegian companies at which KLP has voted (number / percentage) | 112 (97 %) | 102 (97 %) | 106 (98 %) | 115 (97 %) | n/a | n/a |
| General meetings of foreign companies at which KLP has voted (number / percentage) | 8 052 (96 %) | 7 512 (97 %) | 6 408 (97 %) | 2 617 (91 %) | n/a | n/a |
| General meeting items where KLP has voted against management recommendations | 16 % | 18 % | 18 % | 11 % | n/a | n/a |
| Unique companies KLP has had direct dialogue with on ESG topics | 362 | 191 | 103 | 192 | All SDGs | 3.a, 8.7, 12.6, 16.2, 16.4, 16.5, |
Excluded companies
The number of exclusions refers to the total number of companies KLP had excluded from investments because of breaches of the Guidelines for KLP as a responsible investor at the end of the year.
The percentage excluded from the index shows how much of the index KLP does not invest in because of exclusions, measured by the market value of the companies.
The number of re-included companies relates companies where the exclusion was reversed during the year.
General meetings
KLP uses services from ISS to vote at general meetings of companies in which we have investments. At general meetings of Norwegian companies (domiciled or listed in Norway), KLP votes manually through ISS. At general meetings of foreign companies, KLP uses proxy voting through ISS.
Dialogue with companies
The number of unique companies KLP has engaged with refers to companies that KLP has been in direct dialogue with during the year on social, environmental or governance issues. KLP may have several dialogues with a company during the year related to various topics. KLP’s follow-up varies in scope, subject-matter and time frame. This is a way of exercising ownership in which KLP engages in a dialogue with companies to clarify how they handle corporate social responsibility issues and to communicate KLP’s expectations as an investor and owner.
Developing products and services that contribute to positive development in societySTRATEGIC OBJECTIVE
Health promotion and injury prevention
KLP aims to develop products and services linked to our core business which respond to some of the sustainability challenges our customers and owners have, and that benefit society as a whole.
UN SUSTAINABLE DEVELOPMENT GOALS
The figures show how KLP contributes to several of the UN Sustainable Development Goals:
- Goal 3, Good health and well-being
- Goal 11, Sustainable cities and communities, and especially target 11.5: By 2030, significantly reduce the number of deaths and the number of people affected by disasters, including water-related disasters.
- Goal 13, Climate action
TARGET
- Run 50 courses on injury prevention.
- Support 28 projects on health-promoting workplaces.
Results in 2020
The execution of injury prevention courses and projects was affected by the Covid-19 pandemic, and in general was replaced by digital activities. A total of 12 webinars were organized on various issues related to municipal housing and waste management, with a total of 820 participants from municipalities all over the country.
In 2020, KLP supported 37 projects on health-promoting workplaces. There were 13 new projects included in the network, focusing on inclusive workplaces, full-time culture, reduction of sickness absence and culture in municipal mergers.
| 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets | |
|---|---|---|---|---|---|---|
| Ongoing projects on health promoting workplaces with customers | 37 | 37 | 25 | 12 | 3. | n/a |
| Completed courses on health promoting workplaces | 93 | 103 | 145 | 100 | 3. | n/a |
| Completed courses on injury prevention | 12 | 20 | 81 | 45 | 11. 13. | 11.5 |
| Participants at courses on injury prevention | 820 | 738 | 2 812 | 1 600 | 11. 13. | 11.5 |
Injury prevention courses
Courses on injury prevention are courses where KLP Skadeforsikring provides training in fire safety. KLP Skadeforsikring has worked with the Norwegian Association of Fire Officers on the design and implementation of the courses. KLP Skadeforsikring also works with KLP’s HSE training department, so the courses may also include training on HSE risk assessment, for example. The courses help to prevent injuries.
Courses and projects on health-promoting workplaces
Projects on health-promoting workplaces are part of KLP’s working environment network, where municipalities, county councils and health enterprises can apply with specific projects related to the working environment and health and safety. The projects run for three years and become part of the network where they receive professional and financial support and can share experiences with other projects. It is the number of ongoing projects in the year that is reported.
KLP also organises courses on health-promoting workplaces with our customers. These are courses on various topics related to health-promoting workplaces, such as preventing personal injury and violence and threats in the workplace.
Lending business
KLP’s lending business is largely aimed at Norwegian municipalities, county councils and enterprises with a municipal affiliation. The loans are used for purposes that help to reduce national greenhouse gas emissions, and benefit society as a whole.
UN SUSTAINABLE DEVELOPMENT GOALS
The indicators support UN Sustainable Development Goal 9, Industry, innovation and infrastructure, and in particular target 9.1: Develop quality, reliable, sustainable and resilient infrastructure, including regional and transborder infrastructure.
TARGET
Increase lending for this purpose.
Results in 2020
In 2020, KLP’s loans to municipalities and county councils increased by NOK 8.2 billion net, and green loans worth NOK 1.15 billion were granted.
| MILLION NOK | 2020 | 2019 | 2018 | 2017 | UN Sustainable Development Goals | SDG targets |
|---|---|---|---|---|---|---|
| Loans for roads and transport | 8 887 | 8 812 | 8 543 | 9 411 | 9. | 9.1 |
| Loans for public property | 4 862 | 4 987 | 4 798 | 4 060 | 9. | 9.1 |
| Loans to public sector and businesses | 64 581 | 56 434 | 51 425 | 45 087 | 9. | 9.1 |
| Lending to water, sewage and waste disposal | 3 112 | 2 638 | 2 005 | 2076 | 9. | 9.1 |
| Of which are green loans | 2 028 | New | New | New | 9. | 9.1 |
Loans for public property are loans for e.g. school buildings, town halls and other municipal buildings. Lending to the public sector and businesses covers the financing of various types of investment by municipalities and county councils, such as kindergartens, nursing homes, schools etc.
Green loans can be given to municipalities, county councils and enterprises with a municipal affiliation. The loan must have a clearly positive environmental and climate effect and satisfy different criteria according to the type of project. The criteria are based on the Green Bond Principles, the Climate Bond Initiative Taxonomy and the Nordic Public Sector Issuers Position Paper on Green Bonds Impact Reporting. The criteria are regularly revised as needed.