Länsförsäkringar sees a positive climate effect of its forest investments

30 June 2022

Beech Trees Forest in Early Spring, from below, fresh green leav

Through its investment portfolios, Swedish ICMIF member Länsförsäkringar is a partner in several forestry companies. “Based on our ownership, we have calculated that the total, positive climate effect amounts to over 550,000 tonnes of carbon dioxide,” said Kristofer Dreiman, Head of Responsible Investments at Länsförsäkringar Liv.

Länsförsäkringar believes that forest investments and raw forest materials make it possible, among other things, to reduce the use of fossil fuels and contribute to reducing climate change.

“Raw forest materials can replace fossil fuels and other materials that are carbon dioxide-intensive, which gives positive so-called substitution effects. A sustainably managed forest with net growth also has positive climate effects when the forest grows and thus binds carbon dioxide. Forestry must also deal with, among other things, biological diversity and the impact of a changing climate,” said Kristofer Dreiman.

In calculating the climate effect, the forest’s uptake of carbon dioxide (stocks with net growth), the substitution effect and the companies’ emissions of carbon dioxide (scope 1–3) have been taken into account. The calculations are based on the forest companies’ individual accounts, applied methods and assumptions. The methods and assumptions are continuously developed and the companies are encouraged to be transparent with them.

“In the future, raw forest materials and the individual forest companies have growing potential linked to, among other things, wooden structures in buildings; the use of cellulose in battery production; the provision of land for renewable energy production; and that by-products such as branches and bark can be used for biofuel production,” said Kristofer Dreiman.

The investment portfolios include the forest companies SCA, Holmen and HT Skogar, which are examples of investments within the framework of Länsförsäkringar’s climate-smart vision.

Earlier this year, Länsförsäkringar announced it had been ranked top for the insurance industry in the Swedish Sustainable Brand Index™ 2022 results. This was the fifth time the mutual insurer has been in first position in this survey since 2011.

* Investment portfolios refer to the institutional life, guarantee and insurance portfolios linked to Länsförsäkringar Liv, Länsförsäkringar AB with subsidiaries and Agria, and Länsförsäkringar Fondliv. In the calculation of climate effects, the participation of these portfolios in SCA, Holmen and HT Skogar has been included. The calculation also includes Länsförsäkringar’s ownership in HT forests but not any ownership in other forest companies.

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