EnergyWatch

Investors urge Samsung to skip coal power plant: If we succeed, the Chinese will probably build it instead

Nordic investors such as Akademikerpension and Nordea push Samsung to halt plans to build a massive coal-fired power plant in Vietnam.

Anders Schelde, chief investment officer at Akademikerpension. Photo: PR/MP Pension

"Coal is the worst fossil fuel there is," says Anders Schelde, chief investment officer at Danish pension fund Akademikerpension – formerly MP Pension – in a video at Linkedin.

The existing power plant has already documented local environmental problems. But the biggest problem is CO2 emissions. We hope Samsung understands the point in stopping this project.

Anders Schelde, Akademikerpension

The video marks the pension firm's second attempt to get Samsung's attention. The South Korean multinational conglomerate plans to help build a new – and according to Schelde, "gigantic" coal-fired power plant, Vung Ang 2 in Vietnam.

"The existing power plant has already documented local environmental problems. But the biggest problem is CO2 emissions. We hope Samsung understands the point in stopping this project. We have high expectations for a global household brand like Samsung – and we will push for the company to put it to a halt," Schelde continues.

An urgent matter

In 2019 the pension fund made announced its ambition to become Denmark's most responsible pension fund. By the end of 2020, the group plans to have sold all equities associated with oil, coal, and tar sands.

Absent ownership, it's difficult to put pressure on fossil fuel operators, Schelde tells EnergyWatch's sister media, AMWatch. Instead, the pension fund has chosen to focus on companies lobbying against the Paris agreement or companies either financing or building coal power plants.

"To us, it was new information that Samsung considers bidding for constructing this coal power plant in Vietnam. We are not afraid to go public with criticism like this. We also realized that it is an urgent matter, and together with our international media consultant, we tried to get a story about it in international media," Schelde says.

A news story did reach Bloomberg. But Akademikerpension was not mentioned alongside the three larger investors, the UK's biggest manager of corporate pension schemes, Legal & General Group, Nordic banking group Nordea, and Norway's KLP Kapitalforvaltning.

"That's why we decided to make our own video, which we are now trying to bring to the attention of Korean news media," Schelde says.

"This is status at the moment. We will see what happens, and if necessary, we will reach out to the other two Nordic investors," he adds.

Samsung has told us that they are considering the project but that they need to look at various parameters such as the environment, so I think there is a chance that they will listen to us

Eric Pedersen, Nordea AM

At Nordea Asset Management, Head of Responsible Investments Eric Pedersen is also following the case with great interest.

"Samsung has told us that they are considering the project but that they need to look at various parameters such as the environment, so I think there is a chance that they will listen to us," Pedersen tells AMWatch.

But he fears it will not prevent Vung Ang 2’s construction.

"The sad thing about this story is that if there is enough investor pressure – I think maybe we can get the Japanese banks in on it as well – then the coal power plant could still end up being built, with perhaps Chinese support," Pedersen says.

"But I still think it's worth to try and to prove that dialog does influence companies' behaviour. The best thing would be if the international attention could get the Vietnamese side to drop the construction of the plant completely," he adds.

Plans to contact other investors

Pedersen has shared the video from Akademikerpension on Linkedin.

"It is obviously glaring to build a huge new coal power plant. It goes against everything that most global investors, the UN, etc. can agree on is a good idea" Pedersen says.

The next step for Nordea will be to contact other investors.

"We are often in contact with other investors. We haven't discussed this exact issue with them, but we will do that now," Pedersen says.

Both Nordea and Akademikerpension were part of a shareholder climate resolution to halt Japanese lender Mizuho's ability to finance coal power developers.

The proposal did not get the needed support from the rest of the shareholders to go through, but it did get as much as 30 percent suppert, which is very high – especially for Japan where such resolutions have not been seen before.

"It actually moved things a lot, without completely meeting our demands. However, we have a feeling it also left its mark on other Japanese banks, which also makes this kind of financing. So, it's a bit of success in all modesty," Schelde says.

(This article was provided by our sister media, AMWwatch

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