How we work

BankInvest wants to be committed to and serious about its work with responsible investments. We are dedicated to advancing sustainability and responsible investment practices on multiple fronts.

At BankInvest, we believe that companies create the most value by operating their business responsibly. We invest in several thousand companies and in countries all over the world. We are assisted in this by experts who serve as our eyes and ears and speak to companies on our behalf.

BankInvest works with the consultancy firms MSCI (ESG analyses), Sustainalytics (screening and dialogue) and ISS ESG (voting at general meetings). BankInvest also subscribes to a number of initiatives for responsible investment, including the UN-backed Principles for Responsible Investment.

Our team of ESG experts works closely with the portfolio managers to ensure that the portfolio companies meet BankInvest’s guidelines for responsible investment.

When we place demands on companies, we also place demands on ourselves. This is managed by BankInvest’s Responsible Investment Committee, headed by our chief executive officer. The Committee discusses topical cases and sets the direction for responsibility and sustainability.

The Committee also has the last word if, for various reasons, a company ends up on the list of companies in which our portfolio managers must not invest (the “exclusion list”).

The committee meets at least four times annually and consists of BankInvest's CEO (chairman), as well as representatives from asset management and fund administration.

BankInvest integrates ESG matters in the investment process. This means that besides looking at traditional, financial ratios, the portfolio managers also include non-financial ratios and parameters in the investment analyses, including how the companies handle ESG matters. 

To obtain ESG data for the purpose of analysing corporate investments, BankInvest cooperates with the international data supplier MSCI ESG, which specialises in analysing companies’ ESG parameters. MSCI ESG provides both ESG data and research.

If MSCI ESG assesses a company to have poor ESG qualities resulting in the lowest ESG rating (CCC), the responsible portfolio manager must explain in writing how he/she assesses the future ESG prospects for the company in question. This means that a follow-or-explain principle is practised for CCC-rated companies. The typical reason to invest in companies with poor ESG qualities is to influence the companies through direct investments going forward. Further, the ESG rating is often based on historical conditions. Moreover, in some cases the portfolio manager may assess that he/she has knowledge of the company that goes beyond that of MSCI ESG. The written report must be sent to the Chief Sustainability Officer, who informs the Responsible Investment Committee at the next Committee meeting.

Active ownership is a key element in BankInvest’s approach to responsible investment.

As an investor, active ownership means that you use your rights and influence as an owner to improve companies’ behaviour.

This could be either by the investor voting at the company’s general meeting or by entering into a dialogue with the company’s management. It is called engagement when you enter into a dialogue with a company as a consequence of its violation of international norms and conventions.

Instead of selling the shares, the investor therefore initially seeks to influence the company to change its behaviour through dialogue. This is a key element in BankInvest’s approach to responsible investment. If dialogue fails, you can exercise influence at the companies’ general meetings and ultimately sell the shares.

BankInvest’s Responsible Investment Committee has the decision-making power to exclude a company from BankInvest’s investment universe.

BankInvest cooperates with the international consultancy firm Sustainalytics which manages the dialogue for several other Danish investors. Sustainalytics is tasked with monitoring – or screening – all investments in BankInvest’s listed portfolios and investment divisions.

This is also known as norm-based screening and means that the investments are reviewed for companies that potentially violate international norms (such as the UN Global Compact) for environmental protection, human rights, labour standards and business ethics.

BankInvest will invite companies failing to observe the norms to a dialogue through Sustainalytics to seek to positively influence the company’s behaviour. We can do this ourselves or with other investors.

A process of dialogue can involve a number of initiatives, including discussions with the company’s management, influencing the composition of the board and voting at general meetings.

If these efforts are unsuccessful, it could lead to divestment of the company’s shares. This will be assessed by BankInvest’s Responsible Investment Committee.

Some of the most important norm-based criteria:

• ILO labour market conventions
• UN Declaration of Human Rights
• The UN Global Compact

BankInvest has a general ban on investing in companies involved in the production of controversial weapons such as cluster munitions, land mines, chemical and biological weapons and nuclear weapons outside the Non-Proliferation Treaty as well as companies in which more than 5% of the revenue comes from coal mining and production of tar sands.

Exclusion may also be a possibility if a company breaches international norms and does not demonstrate any will to take responsibility and change its behaviour as described in the section on Norm-based screening.

The Responsible Investment Committee has the decision-making power to exclude a company from BankInvest’s investment universe, which decision is typically recommended on the basis of an analysis made by the Chief Sustainability Officer.

The exclusion list is published regularly and can be found at the bottom of this page.

Moreover, certain divisions with special sustainability considerations may have stricter exclusion criteria for sectors and companies that are not assessed to be sustainable. In such case, this is described in the divisions’ prospectuses.

For government bond investments, BankInvest follows UN and EU sanctions and excludes countries that are subject to sanctions against investment in government bonds. In addition, BankInvest invests in government bonds in accordance with international conventions and with consideration of the UN-backed principles for responsible investment.

When BankInvest invests in government bonds issued by Emerging Market countries, we have ESG focus on the country in question. BankInvest’s investment policy in the area includes the methods from the FFP’s Fragile States Index and the MSCI ESG rating. FFP makes an annual assessment of countries based on indicators in three groups: social, economic and political/military indicators and divides the countries into 11 categories. If a country belongs to the two lowest categories (High Alert and Very High Alert), BankInvest will generally not invest in government bonds from that country, unless approved by the Responsible Investment Committee. As a general rule, BankInvest reviews the results once a year.

MSCI ESG makes an overall assessment of the countries according to E (Environment), S (Social), and G (Governance) on the basis of a number of factors. The countries are then given a general ESG rating between AAA and CCC. If a country is rated CCC, BankInvest will generally not invest in government bonds from that country, unless approved by the Responsible Investment Committee. As a general rule, BankInvest reviews the results once a year.

On 10 March 2021, a new EU regulation on sustainability-related disclosures (also called SFDR or the Disclosure Regulation) was enacted.

The Disclosure Regulation is a set of rules for how to provide information about sustainability – both at the overall company level and at product level for the individual divisions. The rules aim to improve the quality of sustainability-related information for investors.

BankInvest is subject to the rules, both as a financial market participant and a financial adviser through the group companies BI Asset Management Fondsmæglerselskab A/S and the investment management company BI Management A/S.

BankInvest has adopted the following policies and declarations that ensure BankInvest’s compliance with the obligations under the Disclosure Regulation.