Investor thinking

Dutch Pension Industry €1.5 trillion ESG ‘Green Swan’ Accelerating for European Take-off

The €1.5 trillion Dutch pensions industry, the largest in the European Union, and the fourth biggest in the world, is driving forward in adopting ESG (environmental, social and governance) principles to colour all its investments green across asset classes and markets. The sheer size and concentration of capital represented by this ESG firepower, means these institutional investors could emerge as a leading ‘Green Swan,’ a powerful game-changing force that positively shifts the balance in the greatest existential challenges facing humanity, such as Global Climate Change, investment specialists at a recent AXA Investment Managers’ online media roundtable concluded.

In his book: ‘Green Swans: The Coming Boom in Regenerative Capitalism,’ John Elkington, described as the “Godfather of Sustainability,” says that if Nassim Taleb’s ‘Black Swans’ are problems that take us exponentially towards breakdown, then Green Swans are ESG solutions that take us exponentially towards breakthrough.

Elkington identifies the European Commission’s Green Deal as a potential Green Swan. The EC’s plan is designed to attract at least €1.0 trillion worth of public and private investment over the next decade and to turn Europe into a climate neutral economy by 2050, which will require massive investment in clean energy technologies. The total Dutch pension funds investment base, however, is half as big again as that being commanded by Brussels and is larger than the GDP of the Netherlands itself, the fifth-ranking economy in the Eurozone

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Photo credit: Manon Geuskens, Bellier

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