As geopolitical uncertainty leaves many European pension funds exploring how to invest more in defence, Norway's KLP has just divested two listed defence companies for selling weapons to Israel because of human rights concerns in Gaza.
Ilmarinen, Finland’s €63 billion ($73 billion) pension insurer, is laying the ground to significantly increase its equity allocation ahead of new pension rules in the country. CIO Mikko Mursula is preparing for a sharp increase in volatility of annual returns and the enhanced role and importance of diversifying the portfolio.
APG Asset Management, the largest pension fund provider in Europe, considers the arguments for investing more in defence alongside positioning the portfolio for more impact and infrastructure investment.
The fragmentation of global power, and big increases in defence spending, alongside climate change and the rise of AI, have been identified by Wellington Management as major generational changes that will impact markets for decades to come.
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