(Refiled to clarify in paras 7 and 8 that Carlsberg’s management’s wage package was adopted by the annual meeting without a vote)
* Denmark’s ATP moves investments to cash shares from derivatives
* CEO aims to make firms gauge social, environmental impact
By Teis Jensen
COPENHAGEN, Aug 30 (Reuters) - Denmark’s largest pension fund, ATP, said on Wednesday it will seek more active ownership of companies by pushing management to practice good governance and consider their social and environmental impact.
The fund, which handles 850 billion crowns ($136 billion) of assets for 5 million Danes, has been moving investments from derivatives to cash shares, and taken more of its management of those shares in-house.
“We want to be more active at annual meetings, we want to be more active in swaying companies to have good governance and relate to ESG (environmental, social and governance criteria),” Chief Executive Christian Hyldahl told Reuters.
ATP, a low-risk investor, has not increased its exposure to shares, but shifted it into owning more actual shares in individual companies, rather than having an indirect exposure via derivatives.
“When you have derivatives, you have no active ownership, you can’t vote, you just have a financial exposure,” Hyldahl said. “We want to take the responsibility we have as a large investor on us, and be active at the annual meetings.”
Hyldahl took over the reins at ATP from Carsten Stendevad at the turn of the year.
In March, ATP objected to a proposed wage package for the management at Danish brewer Carlsberg’s annual meeting, saying it was a potentially too lucrative deal.
The package was adopted at the annual general meeting without a vote. Carlsberg’s main owner The Carlsberg Foundation holds the majority of shareholder votes in the brewer.
Hyldahl said derivatives in some cases still can be the right choice for ATP. “But our core exposure will be in cash, because then we can vote and follow the companies.”
He also said it was difficult for external asset managers to beat the share indexes, and that they therefore in some areas were too expensive for ATP to use.
ATP on Wednesday posted its strongest half-year profit in five years, 12.6 billion crowns, driven by positive returns across its investment portfolio.
The largest positive return came from listed Danish equities, but private equity, listed international equities and credit investments also contributed high positive returns.
$1 = 6.2263 Danish crowns Editing by Jacob Gronholt-Pedersen and Dale Hudson