10 FUND IN FOCUS
„ Despite its emissions-intensive profile, the steel industry is a key structural enabler in the energy transition. Alexandra Christiansen portfolio manager at Nordea Asset Management Instead of categorically excluding certain industries on the basis of their current emissions, NAM’s portfolio managers keep an eye on the big picture. Their goal: a sustainable future.
within the Nordea 1 – Global Climate Engagement Fund .4 “Despite its emissions-intensive profile, the steel industry is a key structural enabler in the en- ergy transition. For example, an offshore wind farm or photovoltaic plant can be multiple times more steel-intensive than a conventional coal or gas plant,” Christiansen explains. “Even if this was not the case, a material as ubiquitous as steel cannot be ignored in the global decarbonisation drive. Decarbonising the steel making process should be taken very seri- ously in the context of a global net zero ambition.” ArcelorMittal 5 , one of the largest steel producers in the world, is central to the debate around investing in “green” steel production via the implementation of hydrogen and carbon capture technology in the pro-
teams must be willing to reposition businesses to be resilient to the transition and physical risks of climate change. “Through the engagement process, we work with corporate management teams to assess and achieve meaningful short- and long-term goals, with regular progress reviews,” Christiansen explains. If positive momentum stagnates, the NAM team can decide to escalate interactions or divest. Corporates on the right side of change Responsible for roughly 9% of global emissions, the carbon-intensive steel industry is viewed negatively on ESG criteria – which means stocks in this space are unlikely to feature in many sustainability-focused investment strategies. And yet, steel companies are
4 As at 31.05.2023. 5 Reference to companies or other investments mentioned should not be construed as a recommendation to the investor to buy or sell the same but is included for the purpose of illustration.
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