Together, the AP Funds (AP1-AP4) achieved their best result ever of SEK 316 billion. This significantly contributes to the stability of the income pension system and the mission to be of the greatest possible benefit to current and future pensioners.
The average return for the year was 19.3 per cent after expenses. The AP Funds’ average return over the past five years and the past ten years respectively is 10.5 and 10.7 per cent per year, compared with the performance of the income index of 2.8 and 2.7 per cent per year over the corresponding time periods. The income index is used to calculate pensions and pension entitlements in the income pension system. When the AP Funds’ return exceeds the performance of the income index, the AP Funds contribute to the strength of the pension system.
At the end of 2021, the AP Funds’ total assets under management amounted to SEK 1 937 billion, corresponding to an increase of SEK 285 billion compared with the end of 2020.
In 2021, the AP Funds paid out SEK 30 billion to cover shortfalls in the pension system. Since their start in 2001, the AP Funds have made a net contribution to the pension system of SEK 233 billion. At the same time, the Funds’ return has contributed to the financial strength of the pension system and the AP Funds’ share of the pension system now accounts for almost 18 per cent of pension assets, compared with 10 per cent in 2001.
In accordance with the Paris Agreement, the AP Funds continued to work on climate change adapting of their portfolios during the year. In 2021, carbon emissions in the portfolios were reduced by a further 14 per cent. Of the year’s reduction in emissions, 5 percentage points were due to the portfolio companies reducing their emissions and 8 percentage points were due to the AP Funds’ portfolio adjustments.
During the year, the Council on Ethics continued its important advocacy work in around 90 company dialogues with a focus on human rights, corporate governance and climate. As sustainability is increasingly being integrated into the Funds’ management strategies and objectives, at the end of 2021 a decision was taken to review the Council on Ethics’ mission and strategy.
Kristin Magnusson Bernard, CEO of AP1, Eva Halvarsson, CEO of AP2, Kerstin Hessius, CEO of AP3 and Niklas Ekvall, CEO of AP4, jointly commented:
“Our joint results for 2021 are our best ever and amount to as much as SEK 316 billion. We started in 2001 with assets under management of SEK 536 billion, which had grown to SEK 1 937 billion by the end of 2021. The AP Funds deliver long-term returns that have significantly exceeded the performance of the income index over time, which means that the AP Funds have contributed strongly to the stability of the pension system. From a 10-year perspective, the return has been very high, averaging 10.7 per cent per year. Internationally, we are considered to be a role model in sustainability and we have continued to develop this important work through both responsible investments and responsible ownership.”
For more information, see the Funds’ annual reports and sustainability reports at www.ap1.se, www.ap2.se, www.ap3.se and www.ap4.se
For more information, contact:
Sara Christensen, Head of Communications, AP1, sara.christensen@ap1.se