Making active ownership count
The desk frames this as a growing acknowledgment of the significance of active ownership in responsible investing, as highlighted by Nordea's commendation in the recent Voting Matters report, which places them 8th among 69 global asset managers. Per the full note, Nordea's approach, especially towards aligning with Paris Agreement goals, reflects a broader trend in the asset management industry prioritizing ESG considerations amidst evolving market dynamics. This proactive stance could enhance shareholder trust and potentially drive equity valuations higher. However, market focus may shift towards how these principles translate into financial performance amid ongoing economic adjustments.
What the desk is arguing
Nordea's recognition as a leading practitioner of active ownership serves as a pivotal example of how ESG commitments can influence investment strategies. According to the Voting Matters report, Nordea's commitment to environmental governance has positioned them as a frontrunner, particularly in the Nordics.
The report underscores the importance of shareholder voting rights, with Nordea and other firms advocating for enhanced corporate governance to mitigate risks associated with climate change. Notably, their emphasis on aligning with the Paris Agreement indicates a shift towards sustainability-focused investment frameworks aiming to safeguard long-term value.
Where it sits in our coverage
Our current consensus target for the EUR/USD pair stands at 1.075, with a range of 1.04 to 1.12. Among key players:
- jpmorgan targets 1.10 for March 2026.
- bofa has a counter stance with a target of 1.04 for the same period.
The desk's call aligns closely with our jpmorgan estimate, suggesting that as active ownership practices gain traction, this could strategically position shares in favor of firms like Nordea that excel in ESG metrics.
How other firms see it
Aligned firms like jpmorgan echo a positive outlook towards companies with robust active ownership strategies, while contrary views as presented by bofa suggest caution against overestimating the benefits of such positioning in uncertain markets.
Furthermore, the trajectory of the EUR/USD pair is expected to intersect with upcoming economic indicators tied to ESG performance, making it crucial to observe any corporate governance developments in parallel with central bank policies.
How firms align with this view
Aligned with the desk view
Contrary positioning
Key takeaways
- 01Nordea ranks 8th in global asset management for active ownership, leading in Nordic markets.
- 02Focus on responsible investing is increasingly intertwined with broader investment strategies amid market volatility.
- 03The emphasis on environmental governance correlates with potential impacts on corporate valuations.
- 04Investors should monitor how active ownership affects firm performance in an evolving economic landscape.
Market implications
Investors should keep an eye on the EUR/USD pair, particularly around the 1.075 level, as this may serve as a psychological barrier influenced by ESG momentum. Additionally, upcoming corporate earnings releases could reflect the financial performance of firms leveraging active ownership principles.
Risks to this view
A shift in investor sentiment away from ESG priorities or negative corporate governance outcomes could undermine positive perceptions of firms like Nordea, potentially leading to a significant revaluation of price targets extrapolated from their active ownership strategies.
Responsible investments Making active ownership count 11-03-2024 Nordea gets high recognition for how we practise active ownership in a recent independent report where we are compared to peers. The Voting Matters report is evaluating how large asset managers are exercising their shareholder voting rights to positively influence environmental and social issues. The organisation behind the annual report is ShareAction , a non-profit organisation working globally to raise the standards for responsible investments.
Cecilia Fryklöf, Head of Active Ownership. In their latest report Nordea is ranked number 8 among the 69 largest asset managers in the world. “We welcome the report and are proud to be in top 10 and number 1 in the Nordics,” says Cecilia Fryklöf, Head of Active Ownership at Nordea. “Nordea believes in active ownership and it’s an important part of delivering on our promise to be a responsible investor. Our customers expect us to invest in companies that manage their ESG risks well and that we act as active owner to ensure the companies align with our expectations when it comes to environmental and social issues.” Action on climate change In environmental matters Nordea expects companies to align with the goals of the Paris Agreement since unmanaged transitions and physical risks might impact shareholder value across sectors.
As a member of The Net Zero Asset Managers initiative and Climate Action 100+ Nordea also supports initiatives that drive positive action on climate change. Katarina Hammar, Head of Corporate Governance. At Nordea the actual voting is performed by our corporate governance team.
Spring is normally the time when most AGMs take place and provide an opportunity to make our voice heard. It is a busy period, but it’s not only about the number of shareholder proposals we support, explains Katarina Hammar, Head of Corporate Governance: “It’s important to remember that our success is measured by how we contribute to shareholder value and not by the number of proposals supported. We assess all proposals on a case-by-case basis.
The content of the proposals is key and we will support the proposals that we believe are in the best interest of our unitholders.” Voting a tool in driving change Voting at annual general meetings (AGMs) can be used by shareholders as a method to practise active ownership . Active ownership is when shareholders engage in a company they have invested in to influence the company’s strategy and actions. Being an active owner is a part of Nordea’s responsible investment strategy and how we work with environmental, social and governance (ESG) risks.
On a yearly basis, we’re voting at around 4,000 AGMs. In Nordea’s Voting Portal you can see how we’re voting across regions, sectors and companies. Our votes are published within 24 hours so everyone can follow how we vote and act.
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