Responsible Investments Report 
2016

About Nordea
Asset Management
NAM is the largest fund 
provider in the Nordics
NAM is the largest asset 
manager in the Nordics
Nordea Asset Management (NAM) is the largest 
asset manager in the Nordics with a growing 
European presence and business. Our assets under 
management of EUR 217 billion. We are a semi-
captive asset manager servicing Nordea Retail 
Banking, Private Banking and Life & Pensions, as well 
as Nordic and international institutional clients and 
third-party fund distributors globally. We employ 675 
FTEs and 160 investment specialists. NAM is also the 
largest Nordic retail fund provider, with a 17% market 
share, more than 1.7 million unitholders and servicing 
more than 475 Nordic and international institutional 
clients. At the same time, we have a growing third-
party fund distribution franchise servicing 300 
international fund distributors, including 21 global 
wealth managers.
Katarina Hammer (katarina.hammar@nordea.com)
Hetal Damani (Hetal.Damani@nordea.se)
Contact:
All photos in report:
Responsible investments team
Mammut Media
l   Annual report 2016
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Annual report 2016   l
Index
About Nordea Asset Management 	 	
	
	
	
02
Foreword	
	
	
	
	
	
	
	
	
	
04
Responsible investment approach	 	
	
	
	
06
Stewardship and engagement	 	
	
	
	
	
08
- International initiatives
- Focus areas	
- Engagement cases
ESG integration	 	
	
	
	
	
	
	
	
16	 	
	
	
	
	
	
	
Product development		
	
	
	
	
	
	
20	
- Global Stars
- Swedish Bond Stars
Stars Funds 	 	
	
	
	
	
	
	
	
	
22
- Swedish Stars	
	
	
	
	
- Nordic Stars
- Emerging Stars
- Global Stars
Field visits	
	
	
	
	
	
	
	
	
	
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l   Annual report 2016
Foreword
Nordea Asset Management’s 
Responsible Investment Annual Report 2016
The global momentum for responsible investment 
continues as corporates increasingly navigate the 
challenges and opportunities brought by physical, 
human and technological changes. Investors 
recognise that environmental stress, social pressures 
and governance structures can play a material role 
in determining risk and return and are aware of the 
role they play in promoting sustainable business 
practices in financial markets.  
It is my pleasure to introduce Nordea Asset 
Management’s Annual Responsible Investment 
Report for 2016. As we enter our tenth year as 
a signatory to the Principles for Responsible 
Investment (PRI), I am very proud of the steps 
we have taken to take a wider view of ESG 
(Environment, Social and Governance) issues 
and account for them in our investment activities. 
Delivering returns with responsibility is part of our 
mission as the largest Nordic asset manager with 
an increasing European presence and business. 
Not only do we recognise the potential challenges 
and opportunities presented by ESG factors to our 
client’s assets, but also see the increasing demand 
from our clients to integrate these factors in our 
investment decision making, ownership practices 
and product offering. This is a constant journey 
and we will continue to evolve our differentiated 
approach to responsible investment.
In 2016 the World Economic Forum identified failure 
of climate change mitigation and adaptation, water 
crises and profound social instability within the 
top five global risks of highest concern for the next 
10 years.  These are issues that not only present 
challenges for countries, but present risks and 
opportunities for the entities in which we invest, and 
ultimately the assets we manage. For Nordea Asset 
Management, we believe company engagement 
is critical in our action as investors. In 2016 we 
continued our commitments and ambitions to 
address these areas:
• Climate Change; By the end of 2016, the required 
number of countries that produce enough of 
the world’s greenhouse gases signed the Paris 
Agreement in order for it to enter into force.  To 
remain competitive, companies and investors 
will need to understand how the Agreement 
will affect markets, regulation, and operations 
- and take corresponding action. We are part of 
several investor initiatives that support corporate 
resilience in a low-carbon universe and we are 
proud of our collaborative achievements in 2016 
in seeking enhanced climate disclosure by the 
entities in which we invest. 
• Water; Given the magnitude of global water 
crises, the societal impacts and the operational 
constraints it poses for companies and their 
suppliers, we lived one of our “proudest moments” 
when we, as active investors, were able to increase 
awareness of and action on reducing water 
pollution in the pharmaceutical industry supply 
chain.
  
• Human Rights; Businesses benefit from a stable 
social and political environment for running their 
operations and respect for human rights issues is 
essential to this. In 2016, we joined the Corporate 
Human Rights Benchmark, the first-ever ranking 
of the world’s largest publicly listed companies 
on their human rights performance. The ranking 
offers investors a valuable additional tool for the 
evaluation and engagement of businesses. 
One of our commitments to the PRI is to seek 
appropriate disclosure on ESG issues by the entities 
in which we invest. To support this commitment, 
Nordea Asset Management was one of 14 founding

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Annual report 2016   l
Nils Bolmstrand
Head of Nordea Asset Management
to see some short-term policy uncertainty and 
weakening of ESG-related priorities.  We also expect 
to see new trends emerge as more corporates 
commit to the UN Sustainable Development Goals, 
a set of 17 quantitative and ambitious goals for 
global sustainable development as stakeholders, 
including investors, look for evidence of improved 
ESG outcomes. We anticipate greater demand 
from clients for increased transparency from asset 
managers such as ourselves, on the ESG impact of 
their investments.  
As we move into 2017, our focus will be on 
enhancing our ESG capabilities; working with 
our fund managers and analysts to integrate ESG 
factors for enhanced longterm returns.  We will also 
continue to build our active ownership activities to 
encourage good practice in the entities in which 
we invest. We shall also strive to find new ways of 
increasing transparency to assure clients we are 
delivering returns with responsibility.
members of the Sustainability Accounting Standards 
Board Investor Advisory Group, a US-based 
group that will support improving the quality and 
comparability of sustainability reporting. We believe 
the initiative will help investors make more informed 
investment decisions.
In addition to our active ownership commitments 
and achievements, we have also further developed 
our RI product offering, with the launch of the 
latest member of the Stars fund family, the Global 
Stars Equity fund, and the launch of Institutionella 
Aktiefonden Världen, a product that follows the 
MSCI low carbon target index.  
While we are proud of these steps, we acknowledge 
that there is more to do.  
We expect that 2017 will see continued engagement 
on climate change and on mitigating the physical 
risks such as water scarcity. The focus on corporate 
governance and adoption of global standards in 
Asian capital markets will strengthen. And while we 
don’t expect the results of the 2016 US election to 
change fundamental long-term ESG trends (due to 
the economic imperative for action), we do expect

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l   Annual report 2016
At Nordea Asset Management (NAM) we deliver on 
the mandate given to us by our clients – to generate 
the highest possible return with the lowest possible 
risk by managing and investing their assets in a 
responsible way.  We achieve this by managing 
funds actively and delivering alpha. At NAM we 
fulfill this responsibility by being an active owner 
and engaging with companies on environmental, 
social and corporate governance practices (ESG).
The responsible investment strategy and activities 
are overseen by the Responsible Investment 
Committee (RIC). The RIC includes members from 
the Senior Executive Management team and is 
chaired by the CEO of NAM.
In our approach to asset management Nordea 
applies internationally recognized principles of 
responsible investment and active ownership. 
Nordea has developed its policies, procedures and 
investment products to ensure that the companies 
we invest in all live up to various criteria of sound 
environmental, social and governance performance.
NAM was among the first Nordic institutions to sign 
the Principles for Responsible Investment (PRI) in 
November 2007. By endorsing the PRI we commit to 
integrating ESG factors into our investment analysis, 
decision-making processes and ownership policies 
and practices. The PRI, together with international 
norms, are the basis for our Responsible Investment 
Policy. This way NAM acts as an active owner on 
behalf of its clients in companies and sectors across 
the world. 
By combining financial performance with 
responsibility, we strive to offer clients responsible 
solutions. We believe that we can add value to our 
clients by actively considering ESG in our analysis 
and investment decisions – particularly through 
our investment research, asset allocation and 
performance monitoring. 
We recognize that integrating ESG issues forms 
part of our fiduciary duty to clients and beneficiaries 
and want to see their portfolios managed in a way 
that systematically assesses drivers of risk and 
return over the long term. We aim to integrate 
our ESG research into the investment processes 
of our investment units and also develop and run 
specialized ESG products and services together with 
other units.
Responsible 
investment approach 
We deliver on the mandate given 
to us by our clients
Link to RI Policy: http://www.nordea.
com/en/responsibility/sustainable-
finance/policies/

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Stewardship and 
engagement 
In 2016 we joined a number of new initiatives
Corporate governance 
activities  
 
During 2016 we have attended more than 100 
annual general meetings in the Nordics, and voted 
by proxy in more than 300 companies on thousands 
of proposals. We thus maintain the high level of 
engagement we set in 2015. 
Our goal is to increase our voting level in the com-
ing years. As before, we engage with companies on 
a range of topics, including ESG issues, remuner-
ation programmes and capital structure. In 2016, 
we joined more than 30 nomination committees, 
accepting almost all requests. 
In the companies where Nordea Funds are repres-
ented on the nomination committee, we drive the 
issue of gender balance. In the companies we were 
represented, the level of female board members 
was stable at 35 percent at the end of the 2016 
season.
Engagements
Our model for outlining engagement activities is 
supported by structured processes to prioritize 
our engagement efforts on key issues such as 
underperformance on ESG, high ESG risk exposure 
to a certain theme or sector issue, materiality, 
relevance to our clients and our ability to influence. 
We monitor all investments from an ESG 
perspective on a continuous basis through our 
ESG-integrated investment research and activities, 
including company meetings. We also receive up-
to-date incident reports relating to our holdings 
through an external service provider and review our 
funds annually to ensure that they continue to meet 
our criteria for inclusion. 
We engage at company and industry sector level 
as well as with stakeholders and standard setters. 
We engage on behalf of all of NAM’s funds. This 
supports the ongoing ESG integration activities 
within NAM. We actively vote our shares across 
all markets, which include taking voting action 
in respect of companies where ESG engagement 
has been unsatisfactory, concerns remain and/or 
significant controversies have arisen.
International initiatives
  
We seek to encourage best practices through 
participation in international initiatives. In addition 
to having signed the Principles of Responsible 
Investment (PRI) in 2007, NAM is also a signatory to:
• CDP - CDP is a not-for-profit that runs the global 
disclosure system for investors, companies, cities, 
states and regions to manage their environmental 
impacts including climate change, water scarcity 
and deforestation. We are also represented on the 
CDP Water Advisory Council and the PRI Water 
Risk Advisory Committee. 
• Institutional Investors Group on Climate 
Change (IGCC) - IGCC provides investors with 
a collaborative platform to encourage public 
policies, investment practices, and corporate 
behaviour that address long-term risks and 
opportunities associated with climate change.
• United Nations Environment Programme – 
Finance Initiative (UNEP FI) - UNEPFI is a 
partnership between United Nations Environment

Programme and the global financial sector created 
in the context of the 1992 Earth Summit with a 
mission to promote sustainable finance. Over 200 
financial institutions, including banks, insurers 
and investors, work with UNEP to understand 
today’s environmental challenges, why they matter 
to finance, and how to actively participate in 
addressing them. We are also part of the UNEP FI 
water and finance work stream.
• The Corporate Human Rights Benchmark (CHRB) 
– The CHRB is the first ever ranking of the world’s 
largest publicly listed companies on their human 
rights performance. The Corporate Human Rights 
Benchmark will rank the top 500 globally listed 
companies on their human rights policy, process 
and performance, harnessing the competitive 
nature of the markets to drive better human rights 
performance.
• The Sustainability Accounting Standards Board 
(SASB) Investor Advisory Group - SASB is an 
independent non-profit. SASB’s mission is to 
develop and disseminate sustainability accounting 
standards that help public corporations disclose 
material with useful information to investors. 
Accordingly, SASB has created an Investor 
Advisory Group (IAG). The IAG comprises 
leading asset owners and asset managers who 
are committed to improving the quality and 
comparability of sustainability related disclosure to 
investors.
• The Extractive Industries Transparency Initiative 
(EITI) – EITI is a global standard to promote the 
open and accountable management of oil gas and 
mineral resources. We are now a Board member of 
the initiative. 
• Sustainable Stock Exchanges’ initiative (SSE) as 
a lead investor in the Nordic markets. SSE was 
launched in 2009 and is a global partnership 
platform including most of the world’s exchanges 
and working with exchanges to utilize new 
research to advance their sustainable business 
strategies. Through the SSE exchanges have 
access to consensus and capacity building 
activities, guidance, research to assist in their 
efforts to contribute to sustainable development.
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l   Annual report 2016
Focus areas
We have four areas for our stewardship and active 
ownership activities within ESG: climate change, 
water, corruption and human rights. We engage on 
these issues at company, industry sector and policy 
level. In addition, we engage with companies that 
are identified through our norm-based screening 
process. All of Nordea’s funds are screened annually 
for verified violations of international norms 
regarding environmental protection, human rights, 
labour standards and business ethics.  We also 
engage with companies that we have identified as 
underperforming in terms of ESG and where we see 
material risks that may not be adequately managed 
or opportunities that may not be fully capitalised on. 
Focus area: Climate change
The World Economic Forum’s Global Risks Report 
2016 ranks failure of climate change mitigation and 
adaptation as the highest ranking global risk in 
terms of impact.
Paris agreement
The agreement made at the successful COP21 
meeting in December 2015 in Paris was ratified by 
USA and China on September 3, 2016. Although 
some concerns have been raised after the US-
election, countries are now bound by a ratified 
agreement to keep global temperatures from 
rising more than 2°C by 2100, with an ideal target 
of keeping the temperature rise below 1.5°C. The 
agreement will affect markets, regulation and 
operations. 
• 
We played an active part in calling for the 
agreement and have during 2016 continued to 
push for a transition to a low-carbon economy. 
• 
In September and ahead of COP22, Nordea was 
one of 130 investors that signed a letter calling 
on G20 to take steps to meet the Paris climate 
agreement. 
• 
We participated in the COP 22 climate 
conference which took place in Marrakech, 
Marocco in November 2016.
Aiming for A
In 2016 Nordea joined the shareholder coalition 
called “Aiming for A”,  requesting that the 
companies stress test their business strategies 
against a scenario where climate change is limited 
to two degrees Celsius or less as agreed in the 
Paris agreement. The shareholder initiative filed 
shareholder resolutions at the largest UK-listed 
extractives and utilities companies’ annual general 
meetings (AGM), demanding deeper disclosure of 
climate change risk and opportunity management. 
Climate change
The World Economic Forum’s Global Risks 
Report 2016 ranks failure of climate change 
mitigation and adaptation as the highest 
ranking global risk in terms of impact.
Water
Water-related risks and opportunities 
are becoming increasingly important 
for our investments. 
Corruption
We have seen growing evidence of a 
correlation between corrupt business 
practices and negative effects on long-
term financial returns.
Human rights
We expect companies to observe 
internationally recognized human rights 
principles and to prevent negative effects 
and manage their impact on human rights.

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Annual report 2016   l
At the AGMs of Anglo American, Rio-Tinto and 
Glencore, the Aiming for an initiative won landslide 
victories with 96 per cent, 99 per cent and 98 per 
cent of the votes.
Climate lobbying
We continued being part of the IIGCC investor 
initiative on corporate lobbying in an EU climate and 
energy policy context during 2016. A letter signed by 
50 investors from eight countries representing over 
EUR 4.4 trillion in assets under management was 
sent to 75 companies. 
We continued our participation in the collaborative 
investor engagement on Climate Lobbying with 
more than 60 investors coordinated by the PRI. The 
initiative calls for improvements in practice and 
transparency from investee companies on their 
climate change lobbying practices. 
We are a long-standing member of the CDP (Carbon 
Disclosure Project), which aims at encouraging 
companies to measure and disclose through self-
reporting climate change, water and forest-risk data. 
This information is used in our ESG analysis and 
investment decision-making.
Carbon footprint disclosure 
We believe that increased transparency of funds’ 
carbon footprints contributes positively to tackling 
climate change. We signed the Montreal Carbon 
Pledge launched on 25 September 2014 at PRI in 
Person in Montréal and supported by the Principles 
for Responsible Investment (PRI) and the United 
Nations Environment Program Finance Initiative 
(UNEP FI). By signing this pledge we commit to 
measuring and publicly disclosing the carbon 
footprint of our investment portfolios on an annual 
basis. In December 2015 we disclosed the carbon 
footprint as part of the ESG score cards for our 
STARS funds. Going into 2017, we are expanding the 
disclosure and will initially be publishing carbon 
footprints for all of our equity funds. 
Focus area: water 
Water-related risks and opportunities are becoming 
increasingly important for our investments. 
Water pollution in the pharma supply chain
The pharmaceutical industry is one of the fastest 
growing segments of the Indian economy. The 
market is expected to grow to $100 billion by 2025.
As part of our engagement with pharmaceutical 
companies regarding their supply chain 
management and the evidence of poor waste water 
management within pharmaceutical manufacturing 
in India found during Nordea’s visit to Hyderabad 
and Visakhapatnam in April 2015, we commissioned 
an on-the-ground report on water pollution in 
Hyderabad and Visakhaptanam in early 2016 
from the NGO Changing Markets. The resulting 
report documents and show local impacts of drug 
pollution and severe contamination of waterways 
and agricultural lands. The report can be accessed 
through our website: Nordea.com.
We have continued to work on this issue with 
the pharma companies and the industry-led 
organization PSCI (Pharmaceutical Supply Chain 
Initiative).  In April 2016 we were invited to present 
Nordea’s expectations on pharma supply chain 
management and manufacturing practices at 
the PSCI annual meeting. Our expectations were 
well received by PSCI members and PSCI have 
initiated several initiatives to address our concerns. 
We have also been in contact with other relevant 
stakeholders. 
CDP Water Advisory Council
In 2016 Nordea continued our work with CDP’s 
Water Advisory Council and  another collaborative 
engagement initiative that we continued with is the 
PRI-coordinated project focusing on water risks in 
agricultural supply chains.

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l   Annual report 2016
Focus area: human rights
We expect companies to observe internationally 
recognized human rights principles and to prevent 
negative effects and manage their impact on 
human rights. Poor management conflicts with 
the long-term interest in promoting a responsible 
and sustainable development and may impact 
companies’ license to operate. Human rights related 
issues include complicity in human rights abuses, 
modern slavery and child labour, occupational 
safety and health, the rights of indigenous people 
and displacement of local communities, freedom 
of association and collective bargaining and 
international humanitarian law. 
Collaborative engagement 
on human rights in the extractive sector 
We are part of a collaborative engagement 
coordinated by the PRI (Principles of Responsible 
Investment) on human rights in the extractive 
sector. Extractive companies can face significant 
operational and reputational risks if they do not take 
adequate steps to manage human rights issues. 
Such risks include boycotts, project delays and 
cancellations, lawsuits and negative press coverage. 
The engagement targets 50 global large cap mining 
and oil and gas companies with high exposure 
to human rights risks. The selection is based on 
operating regions, existing corporate human rights 
policies and systems, and human rights incidents 
and allegations.   
The Access to Medicine Index 
Two billion people around the world have no 
access to medicine. We believe that pharmaceutical 
companies have an important role to play in 
addressing the access to medicine issue and 
that this particular issue is potentially material to 
long-term shareholder value creation. In order to 
promote better business practices in this area we 
work with the Access to Medicine Index. The Access 
to Medicine Index analyses the top 20 research-
based pharmaceutical companies on how they 
make medicines, vaccines and diagnostics more 
accessible in low- and middle-income countries. It 
highlights best and innovative practices, and areas 
where progress has been made and where action is 
still required. The latest assessment- 2016 Access to 
Medicine Index - was published in November 2016. 
Corporate Human Right Benchmark
In 2016 Nordea joined the Corporate Human Rights 
Benchmark (CHRB) which aims to drive better 
human rights performance through the creation 
of a transparent, credible and publicly available 
benchmark. It will compare 500 of the largest 
companies in the agricultural products, apparel, and 
extractive industries globally based on indicators 
measuring human rights related policies, processes 
and practices. The Corporate Human Rights 
Benchmark will raise the level of awareness of the 
materiality of human rights and help companies 
meet investor expectations on human rights. It will 
also enable financial institutions such as Nordea to 
assess and help clients to ensure they are not linked 
to human rights abuses.. A pilot benchmark of 100 
companies will be launched in early 2017.
We also signed the UN Guiding Principles Reporting 
Framework Investor Statement, an investor coalition 
supporting the UN Guiding Principles Reporting 
Framework and the CHRB. The coalition includes 
85 investors representing $5.3 trillion assets under 
management.
Focus area: corruption
We have seen growing evidence of a correlation 
between corrupt business practices and negative 
effects on long-term financial returns. Transparency 
requirements, both voluntary and mandatory, 
are being developed, requiring companies to 
disclose information on corporate and ownership 
structures and their anti-corruption programs and 
provide country-by-country reporting of taxes and 
government payments. 
Promoting our corruption handbook
We initiated already last year an engagement 
project on corruption management involving 20 
companies among our largest holdings. The aim 
is to promote a proactive approach to corruption, 
implementation of adequate anti-corruption 
measures and improved transparency.

•  The United Nations Global Compact
•  The OECD Principles of Corporate Governance
•  The OECD Guidelines for Multinational Enterprises
•  The Universal Declaration of Human Rights
•  The UN Guiding Principles on Business and Human Rights
•  The Children’s Rights and Business Principles
•  The ILO conventions on labour standards
•  The Rio Declaration on Environment and Development
•  The UN Convention on Corruption
•  The Convention on Cluster Munitions
    http://www.nordea.com/Images/33-99083/RI_Policy_JAN2016_3.pdf
3. We base our Responsible Investment Policy and strategy on international conventions and norms, including: 
Engagement with companies 
 
We use an external service provider to annually 
screen all funds managed by NAM against our 
exclusion criteria as well as for verified violations 
of international norms regarding environmental 
protection, human rights, labour standards and busi-
ness ethics. We also receive on a continuous basis 
incident alerts related to our holdings to ensure that 
the companies we are invested in continue to meet 
our criteria for inclusion. 
If a company is identified as breaching our inclusion 
criteria or international norms, we will undertake an 
internal assessment of the company and the incid-
ent. We may decide to engage with the companies 
identified through this process and through active 
ownership encourage them to improve their ways 
of working. In 2016 we had seven in-depth engage-
ments on norm violations. If a company is found 
to be in breach of our inclusion criteria or does 
not change its norm-breaching behaviour within a 
certain time period, NAM’s Responsible Investment 
Committee may decide to exclude or divest the com-
pany. In some cases we put companies on a watch 
list or quarantine them.
In 2016, we engaged with 153 companies that we 
have identified as underperforming in terms of ESG 
and where we see material risks that may not be 
adequately managed or opportunities that may not 
be fully capitalised on. These companies include 
some of our largest holdings as well as companies 
identified for our ESG-enhanced funds.
The dialogues were part of the around 170 company 
meetings we had during the year.  Through these 
engagement efforts we are also able to identify new 
investment opportunities.
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Annual report 2016   l

Engagement case: 
Phoenix Mills Limited 
NAM is a shareholder in The Phoenix Mills Limited, 
a company that operates in the Indian real estate 
sector. The Company is involved in the ownership, 
management and development of retailed mixed 
use properties that include shopping, entertainment, 
commercial, residential and hospitality assets in 
at Mumbai, Pune, Bengaluru, Chennai, Lucknow, 
Bareilly and Agra.  
We have been a long-term shareholder in Pheonix 
Mills, and the intention of our dialogue over the 
years, has been to  support them to be a sustainable 
real estate developer in India. The country and 
sector context in which Phoenix Mills operates is 
challenging; weaker labour laws, environmental 
considerations down-played and potential legacy 
issues with land acquisition. 
Our constructive dialogue with Pheonix Mills has 
informed our view that Phoenix Mills can withstand 
these challenges credibly, where we encouraged 
enhanced transparency, through reporting on 
management of sustainability issues, to confirm to 
investors that they are a quality company in India. 
In May 2016 we met with Phoenix Mills, in Mumbai, 
India. 2016 marked a good year in terms of the 
company’s commitments of a more strategic and 
coherent approach to material ESG issues. They 
have made progress in capturing the low-hanging 
fruit which can be seen on their progress in the 
following areas: 
• Publication of their code of conduct which among 
other things includes anti-corruption and anti-
bribery commitments 
• Lower cost of maintenance with positive 
environmental features.  E.g. Lighting / HVAC / 
water consumption and publication of their green 
initiative
• Systems and processes to monitor suppliers and 
regular reporting on compliance with labour laws 
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Annual report 2016   l
NAM is a shareholder in Finnish/Swedish pulp and 
paper producer Stora Enso through various funds. 
In 2013, NAM downgraded Stora Enso from an ESG 
perspective and the share has not been investable 
for any of our Stars funds since then. 
Ever since the divestment of Stora Enso shares in 
the Stars funds, the RI-team has been involved in an 
engagement process in order to track Stora Enso’s 
ESG progress with a special focus on human rights 
issues. Over the last couple of years Stora Enso has 
had reoccurring incidents concerning child labor 
in the supply chain of its joint venture operation in 
Pakistan and land conflicts in China and Brazil. 
In 2016 the RI-team planned to visit Stora Enso’s 
operations in both Pakistan and Brazil. This follows 
previous field visits to their operations in Pakistan 
and China. In February 2016 we sent two ESG 
analysts to Stora Enso’s joint venture operations 
called Veracel in the Bahia region in northeastern 
Brazil. 
Veracel operates in a region with political conflicts 
and high inequality in terms of income distribution 
and ownership of land. It’s also a region that used to 
be dominated by the Atlantic Rain Forest. 97 percent 
of the rain forest was harvest in a non-sustainable 
way up until the 1970’s – majority of land became 
pasture.  The land that Veracel operates on has also 
been claimed by the so called Landless movement, 
that consists of poor and unemployed people from 
both the region but also from larger cities, objecting 
to the skewed distribution of landownership  in 
the country. There are also signs of some form link 
between the Landless movement and unions and 
also the Labor party.
Based on our visit we think that Veracel shows 
good understanding of the risks and challenges 
associated with operating in the area, both from 
an environmental and social point of view. Veracel 
has deemed it to be in their own interest to reach 
out and conduct dialogues with stakeholders in the 
region.
The company has learnt the lesson the hard way, 
historically being exposed to violent occupations 
with very bad outcomes on both sides. Needless to 
say, the opposing party (the unions/movement of 
Landless workers) has also digested the fact that 
collaboration will yield the best outcome. 
Veracel seems to have an acceptable relation with 
the indigenous people stakeholders. Concerning 
the Landless movements (see description above), 
Veracel has an agreement with six organizations 
within the movement stating that they can use 
16.000 hectars for farming. Veracel also supports 
the community with education and equipment. 
However, there are other similar organizations 
that also want to use land owned by Veracel with 
whom Veracel does not have any agreement or any 
dialogue at this point. It’s important to understand 
that the root to this conflict has a historic and 
political context, both on a region and national level. 
It’s difficult to see that Veracel and all stakeholders 
will be able to reach mutual understandings without 
political actions taken in Brazil. This issue will 
remain a risk for Veracel going forward, and the 
company will be reliant on political processes that 
are very unpredictable. The company has long-term 
plans of expanding their land area even more, which 
would obviously put them under increased pressure.
The RI-team’s planned trip to Pakistan was 
unfortunately postponed due to security reasons. 
The plan is to conduct the field visit in 2017. In the 
meantime NAM has not changed its position on 
Stora Enso from an ESG perspective and the share is 
not eligible for investment in the Stars funds.
Engagement case: 
Stora Enso

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l   Annual report 2016
NAM aims to take returns with responsibility to a 
new level to ensure competitive, consistent and 
responsible returns for all funds. 
Environmental, social and governance issues are 
an increasing source of risk and opportunity, and 
we therefore seek to integrate ESG issues into our 
investment analysis methodology for our internal 
boutiques to ensure that investment and portfolio 
construction decisions are based on a full set 
Our aim is to include ESG analysis as an 
element within all investment pro-
cesses.
We believe this will improve risk 
management and thereby risk 
adjusted returns. 
Active ownership, engagement, proxy voting 
Norms-based screening, Exclusions
ESG integration in traditional funds
RI-enhanced products
Investment evaluation  to buy/sell 
explicitly includes ESG factors:
· Niche portfolios with sector screens
· STARS portfolios with proprietary ESG ratings 
· Thematic portfolios (e.g. Climate and Environment)
Actively managed products include 
ESG as one of the factors used in as-
sessing investments
ESG integration
of information. ESG data is made available to 
all investment professionals to use in assessing 
investments. We believe this will improve risk 
management and thereby risk-adjusted returns. To 
encourage the use of ESG data we have integrated 
ESG in the portfolio performance reviews of our 
Equities team. 
Our research department includes both financial 
and ESG analysts, and company assessments are 
shared between fund managers as well as financial 
and ESG analysts through a variety of mechanisms: 
our research platform, presentations, joint meetings, 
etc.  
Our responsible investment (RI) team of 9 ESG 
analysts forms an integral part of our investment 
team and works with the fund managers and 
analysts to help integrate significant ESG analysis 
into our investment approach across portfolios.

17 
Annual report 2016   l
“Working with the RI team as an integrated unit has clearly 
benefited our unit holders also from a performance point of view. 
ESG is an integrated part of our investment process and by doing 
research jointly, and interact with companies with representatives 
from both the investment organization and the RI team, we have 
both identified attractive investment opportunities as well as risks 
and events that helped us to avoid poor investments.  
I really look forward to deepen the collaboration further into 2017 
as we are convinced that ESG will be an even more important 
factor to consider when finding sustainable winners.” 
John Hernander, portfolio manager, Nordea Asset Management
ESG 
integration

Proprietary ESG research
As part of our ESG research efforts we continuously 
assess and evaluate transformative themes and 
areas which we believe will shape the future 
landscape of investment. Social and technology 
changes as well as climate change and other 
environmental issues impact business models. The 
ESG research methodology at company level is a 
combination of two distinctive approaches.
First, companies are assessed based on whether 
they conduct their business responsibly in relation 
to their stakeholders – employees, suppliers, 
customers, investors, the environment or society at 
large. Second, we assess whether the companies’ 
products or services are well-positioned in relation 
to broader sustainability megatrends such as 
climate change or changing demographics.
We underpin our approach with externally sourced 
ESG research and ratings. This provides coverage 
of over 4,000 companies globally both in terms of 
their practices and in terms of tracking controversial 
issues. All portfolio managers of our actively 
managed funds have access to ESG data in their 
systems. 
During 2016 we conducted in-depth analysis 
of aproximately 200 companies from an ESG 
perspective. Meetings and on-site meetings were 
part of these analyses, as was the providing of 
feedback to the companies on their ESG materiality 
analysis.  
In 2016 NAM also won Capital Finance 
International’s (CFI) award for best ESG investment 
process in Europe for the third consecutive year. 
According to the jury’s statement Nordea has 
consistently been at the forefront of responsible 
investing, using ESG as a means to mitigate risk and 
maximize opportunity.
l   Annual report 2016
18

19 
Annual report 2016   l
 
” We have had access to ESG data since 2013 and we have recently 
added carbon data. We have used this data in different ways and 
started to look at different ESG metrics to find factors that could 
enhance our quantitative models. 
We have concluded that gender equality on board level has a 
positive impact on long term returns and it is a factor that we take 
into account when selecting companies.“
ESG data
Robert Næss, portfolio manager, Nordea Asset Management

20 l   Annual report 2016
Global Stars 
– the new star of 2016 
On May 23, 2016, a new star was born in the 
Nordea Stars-family. With the launch of our fourth 
Stars-product, Global Stars, our customers can 
now buy into the Stars-concept and also get a 
truly international exposure in their portfolios.  
When picking stocks for Global Stars we 
proactively select high-quality ESG companies 
rather than negatively screening out poor ESG 
industries. We do this through a combination of 
engagement, thematic research, field trips and 
ESG analysis – with each element serving its own 
specific purpose.
Key to the success of Global Stars will be what 
the portfolio managers and the RI-analyst achieve 
together in close collaboration. 
“Since we actually are sitting next to each other, 
we can have dialogues about our investments, 
events and different trends on a daily basis. We 
believe that ESG gives a new dimension to the 
analyses that helps us finding stocks that we 
believe give long term returns and bring positive 
contributions to some of the challenges that the 
world faces”, says Johan Swahn, one of the PM’s 
managing Global Stars. 
According to Johan Swahn, the Stars concept is 
more than just stock picking.
“ESG in an integrated part of the whole investment 
process and reflected in the investment philosophy, 
the valuations and the structuring of the portfolio”.
Since Nordea launched its first Stars fund, 
Swedish Stars, in 2011, we have proved that it is 
possible to deliver returns with responsibility and 
Product 
development
Our new Stars
we are convinced that the integrated ESG process 
is adding value.
“There are many academic studies out there 
showing the correlation between environmental, 
social and governance issues and long term 
performance”, says Hetal Damani, co-head of the 
RI-team and ESG-analyst.
Besides integrating ESG in the investment process 
in order to find long term performers, it’s also vital 
that the customers trust us with managing their 
money in a responsible manner.
“There was a lot of demand for a global fund that 
employed the same ESG considerations as the 
previous Stars funds”, says Hetal Damani.
Nordea Global Stars consists of about 50 stocks 
and has a mandate to invest all over the world. 
The fund has a carbon filter, meaning that it will 
not invest in companies involved with more than 
50 percent of its revenues from production of fossil 
fuels.
Nordea Swedish Bond Stars
– the new star of 2017 
In 2017 Nordea’s RI team will break new ground 
when the Stars concept will be expanded to fixed 
income with the launch of Nordea Swedish Bond 
Stars. 
In 2016, with the launch of Global Stars, we made 
it possible for customers who appreciate the ESG 
approach in the Stars concept to have a truly 
international exposure. In 2017 we take it one step 
further by using the Stars concept of integrating 
ESG analysis in the investment process in the first

21 
Annual report 2016   l
ESG enhances fixed income product. 
“This is a very natural step for us. We started with 
equity and that’s where we have had all focus up until 
now. But clients who want us to manage their money 
responsibly and who share our deep belief that envir-
onmental, social and governance issues are essential 
to manage in order to deliver long term returns, also 
want fixed income alternatives to match their alloca-
tion strategies”, says Katarina Hammar, co-head of the 
RI-team.
The universe for the Nordea Swedish Bond Stars will 
consist of green bonds and Nordic investment grade 
bonds where the issuer of the bond has been evalu-
ated by an ESG analyst from the Nordea RI-team. Just 
like the Swedish Stars, Nordic Stars and Global Stars 
the threshold for investments will be an ESG rating of 
B+ on a scale from A to C.
Green bonds are bonds that are aimed to fund pro-
jects that have positive impacts on the environment, 
like reducing fossil fuel emission, renewable energy or 
sustainable property construction.

22 
l   Annual report 2016
Stars Funds
We have created a family of 
investment funds under the Stars brand 
In line with NAM’s ambition, we have created a 
family of investment funds under the Stars brand. 
The Stars funds are about positive selection and 
selecting quality companies with well-managed 
ESG profiles that generate long-term economic 
value. 
All investments in our Stars funds undergo thorough 
financial analysis and proprietary in-house ESG 
analysis. This enables us to identify material risks 
and opportunities relating to the companies’ 
medium- to long-term operational performance and 
strategic positioning in the market. 
Our ambition is to create shareholder value by 
identifying companies that integrate environmental, 
social and governance metrics, as well as financial 
metrics, into their business model and strategic 
decisions. Active ownership is an important part of 
our investment approach for our Stars funds and 
we have developed long-term productive dialogues 
with several companies, especially companies in 
which we are large long-term shareholders. 
We actively engage with companies when we see 
material risks that may not be adequately managed 
or opportunities that may not be fully capitalised on. 
When assessing companies for our Stars funds, we 
do so, on behalf of all NAM’s funds, which support 
our ongoing ESG integration activities.
Swedish Stars
Our Swedish Stars was launched in 2011 and 
invests in approximately 30-50 swedish equities. 
Below some examples of holdings and ESG 
highlights.
Atlas Copco
The Swedish producer of mining equipment, 
compressors and industrial tools is one of the 
largest holdings in Swedish Stars portfolio. 
Purchased components represent 75 percent of 
product cost, so supply chain management is a key 
issue from an ESG-perspective. Company recognizes 
the risks and has developed proper responsible 
sourcing practices to mitigate risks, including both 
self-assessment process and audits of significant 
suppliers.
The company operates all over the world and also in 
countries with high risk for violation of human rights 
when selling and maintaining equipment. Company 
conducts human rights Due Diligence both on own 
operations and business partners. It has developed 
a customer sustainability tool to investigate 
potential risks based on environmental, labour 
rights, human rights and corruption in markets and 
industries where Atlas is present. Atlas Copco has 
also shared the sustainability tool with industry 
peers to increase the standards in industry.  
During the year Atlas Copco has changed its 
sustainability management and is also overseeing 
its long term targets, which has raised some 
concern from our side. Nordea is however keeping 
close contact with the company in order to feel 
comfortable that Altas Copco continues its efforts to 
manage its ESG risks as good as we believe it has 
done in the past. During the year, Nordea met with 
the company both in its Stockholm headquarters 
and on the field in Columbia to verify that Atlas 
Copco’s strong ESG policies are implemented on the 
ground.
Volvo
AB Volvo is manufacturing trucks, busses, 
construction equipment that to a large extent is 
run on fossil fuel. But with strong focus on R&D, 
Volvo is well positioned to benefit from increased 
demand on environmental friendlier, safer and more

23 
Annual report 2016   l

24 
l   Annual report 2016
automated means of transportation. With both sales 
and production in various parts of the world the 
company is exposed to changes in environmental 
and social legislations, business ethics risks and 
variations in taxations between countries.
Volvo shows very good understanding of ESG 
related risks and has implemented policies 
and procedures to mitigate risks – both in its 
own operations but also in the supply chain. It 
is however a weakness that the supply chain 
management is to a large degree dependent on a 
self-assessment process. Although the company 
meets its suppliers on a regular basis and argues 
that it has very good insights, we believe that there 
is room for improvements in this area and that the 
company in the long run would benefit from a more 
comprehensive and systematic audit process.
Volvo has a good understanding of the 
opportunities that arises from increased awareness 
on climate issues and tougher environmental 
legislations. 
 
 
Nordic Stars
Our Nordic Stars was launched in 2014 and invests 
in approximately 40 nordic equities. Below some 
examples of holdings and ESG highlights.
Wärtsilä
Finnish based Wärtsilä is a producer of power 
solutions for the energy market and the marine 
industry. The company is highly focused on 
innovation and develops energy saving products 
that are flexible fuel based.  This is also where 
the company focuses its environmental initiatives. 
Environmental risk exposure is moderate. But with 
a global presence, and sales potential all over the 
world the company faces heightened risks from 
both supply chain and from business ethical point of 
view.
All ESG work is based on a thorough risk 
assessment and company has strong policies 
for all relevant issues. Long term environmental 
targets from own production is a bit weak, but to 
some extend understandable since environmental 
footprint mainly derives from the usage of its 
products.
Production is both environmentally and socially 
certified. Wärtsilä has a strong supply audit system. 
Corruption risk is recognized by and monitored by 
the company and high risk personnel are identified 
and trained. Company has a whistle-blowing 
function which unfortunately does not guarantee 
anonymity. Nordea believes this to be a weakness 
of the company. The company is using sales agents 
to some extent and has a pre-qualification process 
when selecting these agents. Nordea’s RI team met 
with Wärtsilä in Helsinki during the year to discuss 
the company’s ESG performance.
Gjensidige
Gjensidige, a Norwegian insurance company with 
high exposure towards property and casualty, was 
a new investment for the Nordic Stars fund in 2016. 
The company also offers life, saving and pension 
solutions. From an ESG-perspective, we believe 
that there is a strong management commitment 
and that key issues are identified and managed.  
ESG risks are relatively low since the company is 
mainly operating in Norway. There is high level of 
financial inclusion in the Nordics and thereby limited 
opportunities from that perspective. 
Key issues for the company are human captal, 
responsible investments, environment/climate

25 
Annual report 2016   l
policy, cyber security and business ethics. Labour 
management is very well managed. Climate 
change is the greatest environmental risk for the 
insurance industry but also changing demographics. 
Gjensidige conducts annual climate change risk 
analysis to capture impact on costs and claims. 
Gjensidige is managing ESG related risk in relation 
to its investments through an external monitor 
(GES) and excludes companies that do not meet 
requirements in relation to human rights, labour 
standards, environment, corruption and weapons. 
We believe that there is potential to strengthen ESG 
integration on the investment side and possibilities 
to strengthen ESG-requirements on external 
portfolio managers.
Emerging Stars
Our Emerging Stars was launched in 2011 and 
invests in approximately 50 emerging market 
equities in countries such as Brazil, India and 
China. Below some examples of holdings and ESG 
highlights.
Antofagasta
Antofagasta is a Chilean Copper mining company 
and part of the Emerging Stars portfolio. Mining is 
per definition a risky business from an ESG point of 
view. Therefore we travelled to Chile to get a better 
understanding of how Antofagasta is handling its 
risks and opportunities regarding environmental 
and social issues. Copper mining is twofold; 
Copper plays an important part in the transition 
to a low-carbon economy since it’s used for grids 
for renewable electricity, in electrical vehicles and 
also for green buildings. On the other hand, mining 
is exposed to almost all issues you can think of in 
terms of environmental and social risks.
What we learned at Antofagasta is, how crucial 
access to water is for mining and how much they are 
comitted to find new technologies to secure water 
access. Using untreated and desalinated seawater 
techniques comes at a cost since it consumes more 
energy and also results in higher CO2 emissions, 
which the company is trying to off-set by installing 
renewable energy. In general, Antofagasta is a 
pioneer in many areas in terms of their approach to 
handling water risk. 
Health and safety is another issue, which is very 
important for a mining company and it is clear that 
this is a top priority for the company. For example it 
is incentivizing reporting on near misses to reduce 
the risk of severe accidents and fatalities and it is 
also conducting campaigns towards workers to 
increase awareness of health and safety. 
Another very material issue for the company is 
community relations. At the mine Los Pelambres 
this was becoming a threat to the business and the 
company has succeeded in making an agreement 
with a local community in near proximity of a 
tailings dam. This has secured the company’s ability 
to continue operation in the area and eventual 
expansion.
Taiwan Semiconductor Manufactoring (TSMC).
TSMC has a business model that is very well 
positioned to provide technologies that will be an 
enabler for solutions so sustainability challenges. 
The company has sold off its LED subsidiary and 
closed its solar facility because they were not 
economically viable and will instead focus on 
providing more advanced power efficient and 
ecologically sound chips that can be used for 
supporting sustainable city infrastructure, greener 
vehicles, smart grids, etc. The company is very 
strong in R&D with continuous innovation and also

26 l   Annual report 2016
has R&D expenses that are above peers.
The company continues to show good 
understanding of risks including its suppliers. 
It has management systems, is continuously 
improving its processes, performance and has also 
set new long-term targets, and this all relates to 
its climate change response, water management, 
green buildings, manufacturing and products. 
They also show improvements in its supply chain 
management and raw materials sourcing. In 2016 
TSMC reported that 100% of the smelters and 
refiners from which the company’s suppliers source 
the conflict minerals have been fully audited, vetted 
and certified under the CFSP.
The major challenge for TSMC remains water 
related compliance and operational costs, since the 
majority of its facilities are in water scarce areas – 
90% of production is in science parks in Taiwan that 
have seen droughts during recent years and where 
the regulatory requirements for water recycling has 
become more stringent. 
Human capital is one of the main risk factors 
for the company, since it is crucial for the 
business model to be able to attract and retain 
highly skilled employees to ensure continuous 
innovation. Competition for talent is growing. 
TSMC shows strong human capital management, 
with competitive benefits for employees, profit 
sharing schemes, flexible leave programs, individual 
development plans and diverse learning resources. 
As a result they have a very low turnover rate of 5%, 
3.8% for the age group 30-50 years. 
Global Stars 
The latest star in the Nordea Stars family is Global 
Stars that was launched in March 2016. Below are 
some examples of holdings and ESG highlights. 
Schneider Electric 
Smart grid technology, electro-mobility and 
energy-efficient solutions. These are some of the 
key areas for French electricity giant Schneider 
Electric. The company has an ambitious focus on 
energy optimization and wants this area to grow 
by 7 per cent more than the overall growth. Energy 
optimization is considered vital if the world is to 
reach the global warming target of maximum two 
degree set at the COP15 summit, and Schneider 
is also on the right track in terms of turning green 
thinking into good business.
The company is also working with co-partners to 
realise projects in developing countries, for instance 
increasing access to electricity and teaching 
electrical skills to unemployed youth in rural areas. 
Schneider has developed an inclusive business 
model aimed at contributing to poverty alleviation 
and environmental protection. The company is 
ranked as one of the world’s 100 most advanced 
companies in the area of sustainable development, 
especially in energy efficiency, which is crucial for 
the future well-being of our planet.
Grupo Nutresa
Grupo Nutresa processes, distributes, and markets 
food products both in Columbia and internationally. 
It is a dynamic and high-quality company that is 
well managed from several angles.
The principal activity of the Columbian company is 
to produce and distribute globally a wide range of 
foods marketed under 70 different brands. Grupo 
Nutresa is one of the most dynamic companies 
in Latin America and the only food company in 
the region that is a member of the Dow Jones 
Sustainability Index.
We believe that Grupo Nutresa’s activities have a 
strong sustainability focus. They are well positioned 
within health improvement and strive to keep up 
with health trends. The company has a long-term 
strategy to improve the nutritional profile of its 
products with a 2020 goal to double the products 
that have an appropriate nutritional profile (e.g. 
reduced sodium, saturated fats, transfats, sugar 
and natural dyers).   Furthermore, they have strong 
efforts to reduce the impact of their own operations 
and their suppliers within social and environmental 
areas.
The company aims at increasing awareness and 
action in the areas of nutrition, education and 
human rights, and they collaborate with various 
partners to boost capacities in healthy lifestyles in 
developing countries. Thousands of farmers have 
received technical, social and business counselling 
in developing their crops and strengthening their 
organizations. Moreover, Grupo Nutresa has a 
strong green focus in all their activities.

27 
Annual report 2016   l

As part of our engagement and ESG analysis 
approach, we regularly visit company sites to 
improve our understanding of relevant issues and 
to get a closer view on how investee companies are 
managing their social and environmental challenges. 
We visited Colombia to meet some of the companies 
in the Stars funds covering the telecom, consumer 
and security sector. 
The market is very regulated according to the 
companies we met but there still seem to be room 
for improving enforcement. The impact from the 
ongoing peace process was also highlighted and the 
expectations are very positive.
The main ESG risks that companies in Colombia are 
exposed to are related to business ethics, worker´s 
rights, land rights and the rights of indigenous 
people. We confirmed the ratings we already had 
after meeting them on the ground.
Field visit: 
Colombia
We visited Colombia to 
meet some of the companies 
in the Stars funds 
l   Annual report 2016
28

Katarina Hammer, 
Co-Head of Responsible Investments
“The main ESG risks 
that companies in 
Colombia are exposed 
to are related to 
business ethics, 
worker´s rights, land 
rights and the rights of 
indigenous people. ”
29 
Annual report 2016   l

“Our on the ground 
research informed 
our company analysis 
and also deepened 
our knowledge about 
India’s growing 
sectors, and their 
ESG challenges and 
opportunities.” 
Olena Velychko 
ESG Analyst
l   Annual report 2016
30

In May 2016, the RI team visited several cities in India to meet 
with Indian companies in the Emerging Stars fund and engage 
with Nordea’s top Indian holdings. Our on the ground research 
informed our company analysis and also deepened our knowledge 
about India’s growing sectors, and their ESG challenges and 
opportunities. Growing sectors included energy, construction and 
infrastructure services, manufacturing and consumer. 
We were positive to the fact that management of sector-related 
ESG risks appeared to be slowly improving. In Bangalore, we met 
Wipro, an IT services company focused on supporting companies in 
increasing the efficiency of products and processes.  We also visited 
a construction site of Sobha Developers, a real estate developer, to 
understand how labour issues and safety risks are managed in an 
unorganised sector. 
During two days in Mumbai we visited ICICI Bank and Phoenix 
Mills, as well as other Nordea holdings such as Reliance Industries 
and Tata Motors to get a better understanding of the Indian context 
and how their key ESG issues were currently managed. Other site 
visits during the trip included Adani Ports Special Economic Zone 
in Bhuj, Gurarat, followed by a visit to cotton farmers who are 
beneficiaries of Cotton Connect’s farmer development program 
done with the support of Primark. Our take on the visit is that 
corruption risks are improving at the central government level, but 
are still problematic to tackle at state level. 
There is a lot of discussion on how a growing population is to be 
included in the economy and how to ease doing business in Indian 
states; while we noticed that there is still a down-prioritisation 
as far as more stringent environmental regulations and their 
respective enforcement. ESG opportunities noted included 
India’s rural areas as untapped markets for inclusive growth 
(e.g. microfinance offerings, access to nutrition and hygiene) and 
solutions for smart cities, clean energy and water in India’s growing 
urban areas.  
Field visit: 
India
ESG risks appeared to be slowly 
improving  
31 
Annual report 2016   l

In November 2016, the RI team visited Chile to get a better 
understanding of how ESG risks are managed in Chile’s mining 
sector and to evaluate Antofagasta’s ESG profile, for inclusion 
in our Stars funds. In Chile, we understood that Corporate 
Governance regulatory framework has strengthened in past 
years.  We also understood that Chile is the second most 
transparent and least corrupt country in Latin America. And 
while scores are high on a wide range of human development 
indicators, there is still some income equality. 
One of Chile’s most pressing issues however, included 
environmental (water) issues given recurrent drought.  This has 
a direct impact on the risk profile of Chile’s mining companies, 
as many operate in arid land where severe water shortages 
could pose potential operational risk. Also, numerous large-
scale mining projects have been delayed and cancelled in the 
past due to real or perceived threats to traditional land uses, 
biodiversity or natural resource quality. 
We visited 3 sites of Antofagasta; Los Pelambres mine, El Mauro 
Tailings Dam (and neighbouring community Caimanes) and 
Centinela mine.  Here we learned how Antofagasta is applying 
their new approach to community engagement, pioneering 
technologies to manage water and safety risks such as use 
of untreated sea water and thickened tailings,  and health 
and safety practices at the mine sites. Our on the ground 
visit helped us confirm that what Antofagasta reports in their 
investor presentations and reports, is actually what is being 
implemented on the ground. 
Field visit: 
Chile
Water issues have a direct 
impact on the risk profile of 
Chile’s mining companies 
l   Annual report 2016
32

Hetal Damani, 
Co-Head of Responsible Investments
“Our on the ground 
visit helped us confirm 
that what Antofagasta 
reports in their investor 
presentations and 
reports, is actually what 
is being implemented on 
the ground.”
33 
Annual report 2016   l

“The outcome of the 
US election has put the 
development under 
pressure, since it is 
dependent on especially 
large American 
companies having 
production in Mexico.”
Susanne Røge Lund
ESG Analyst
l   Annual report 2016
34

In November 2016, the RI team visited the Mexican 
company Vesta, which develops and operates in-
dustrial buildings. Mexico is increasingly becoming a 
residence for foreign companies, moving production 
into one of Mexico’s numerous industrial parks with 
convenient geographical location. The outcome of 
the US election has thus put this development under 
pressure, since it is dependent on especially large 
American companies having production in Mexico. 
The purpose of the visit was to update our analysis 
of an existing holding  in the Emerging Star Fund 
and to get on the ground knowledge of their busi-
ness in terms of practices and developments. During 
the visit we visited one of their industrial parks in 
the outskirts of Mexico City to see how they have 
built facilities for companies with a focus on building 
materials, building methods and environmentally 
friendly solutions such as solar panels, LED light-
ing, etc. We also visited a local school, which the 
company has adopted as part of their community 
engagement. From the management we learned 
how they are pushing LEED certified buildings 
towards their clients which is an important part of 
the business model in terms of maintaining tenants 
and making buildings attractive for reletting when 
contracts end. The company still has work to do 
in terms of anti-corruption where they have found 
inspiration in the corruption handbook that Nordea  
has published. 
Field visit: 
Mexico
Mexico is increasingly 
becoming a residence for 
foreign companies
35 
Annual report 2016   l

Nordea Asset Management/ Responsible Investments 
M711
Mäster Samuelsgaten 20
105 71 Stockholm
Sweden
Read more about responsible investments in Nordea:
http://www.nordea.com/en/responsibility/sustainable-finance/
http://sustainablefinance.nordea.com/