Last week, the Danish pension fund AkademikerPension made headlines by blacklisting Tesla and selling off its remaining shares. The reasons cited include the company’s resistance to labor rights, inadequate corporate governance, and Elon Musk’s political statements that are perceived to harm the company’s value, as reported by Bloomberg.
Across the Öresund strait, they are not alone in losing patience with the electric car manufacturer. At least eight Danish pension funds have chosen to blacklist Tesla as an investment option, collectively managing assets worth over 2,000 billion Danish kroner.
In contrast, Swedish pension funds seem to take a tougher stance when it comes to Tesla. Giants like the state-owned AP7, Alecta, and Folksam have not made any decisions to exclude the company from their portfolios. However, several pension actors claim to be actively trying to influence the company through shareholder meetings.
Among the state-owned AP funds, AP7 holds the largest stake in Tesla, valued at around 18 billion kronor at the turn of the year. They have been attempting to address what they see as deficiencies in labor issues, which have evolved into “inadequate corporate governance.”
“It is a concerning development we see around Tesla, and therefore, it cannot be ruled out that AP7 will blacklist the company if no other corporate governance measures prove to be effective,” said Mikael Lindh Höök, the communications chief at AP7.
The pension company Skandia has chosen to retain Tesla in its portfolio, despite recurring concerns about corporate governance. At the same time, Skandia highlights that CEO Elon Musk’s involvement in other companies may create potential conflicts of interest.
“Musk’s role as a figurehead for the US government’s Department of Government Efficiency is also a factor to consider,” said Jonatan Ohlin, Skandia’s press officer. “While Tesla has been an important player in the global economy’s transition to electrified vehicles, the company has exhibited deficiencies in governance and uncertainties surrounding the board’s actions. The company now has an independent chairman, which is a step in the right direction.”
The pension giant SPP, a part of the Nordic Storebrand group managing over 250 billion kronor, has chosen not to include Tesla on its exclusion list. However, certain sustainability funds within Storebrand are not permitted to invest in the electric car manufacturer due to perceived serious and credible shortcomings in Tesla’s operations, particularly related to anti-union activities and workplace discrimination.
“We see serious and credible shortcomings in Tesla’s operations, especially related to anti-union activities and discrimination in the workplace. Based on the available facts, Storebrand’s investment committee does not believe the controversy meets our threshold for exclusion,” said Rickard Ydrenäs, SPP’s communications chief.
SPP emphasizes that they are working to influence the company through active ownership, such as supporting shareholder proposals and voting against the re-election of board members.
SEB Pension and Insurance, one of the largest pension and insurance providers in Sweden, own Tesla in their own funds as well as those offered to pension savers.
“We closely monitor the developments and continuously evaluate all our holdings, but do not comment on any potential changes in advance,” said Johanna Helsing Martin, SEB’s press officer.
Swedbank Robur, a major player in the Swedish fund market with over four million customers in Sweden and the Baltics, has chosen not to exclude Tesla “at this time.”
“None of our actively managed funds currently invest in Tesla. However, the company is owned by some of our index funds, as well as a generational fund (Transfer 50),” said Carina Sesser, the press and information manager at the bank.
She added that individual companies are continuously reviewed but declined to speculate on their future actions regarding Tesla.
Folksam states that they are trying to influence the company, but there are no plans for blacklisting at the pension giant. AMF Pension retains its stake in Tesla, even if they deem it a “problematic company.”
In conclusion, the decision by various pension funds to either blacklist Tesla or retain it in their portfolios reflects the complexities of balancing financial considerations with social and ethical factors. As the debate over Tesla’s governance and sustainability practices continues, these pension actors are actively engaging with the company to drive positive change and uphold their fiduciary responsibilities while considering the broader societal impact of their investment decisions.
By: Alva Bergland and Linus Gisborn