Danish investors challenge Nordea’s Arctic fossil fuel financing ahead of AGM

The bank is set to hold its AGM tomorrow, marking the first time the shareholder meeting will be conducted entirely virtually rather than in a hybrid format. Despite the digital-only setting, several of Denmark’s major institutional investors have already voiced criticism of Nordea’s decision to continue lending to companies expanding oil and gas activities in the Arctic Circle.

Climate campaign groups Friends of the Earth and the Nordic Center for Sustainable Finance have submitted a proposal to the AGM, calling on the bank to halt all loans to firms expanding Arctic oil and gas exploration. They note that Nordea continues to provide financing to Equinor, Aker BP and Vår Energi, all of which are expanding exploration projects in the region.

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Arctic oil and gas exploration is widely considered particularly harmful due to the region’s slow recovery rates, risks to wildlife and indigenous populations, and the increased likelihood of climate feedback loops, such as permafrost thaw.

In February last year, Nordea amended its sector guidelines, effectively weakening existing restrictions on Arctic oil and gas activities.

The resolution to be voted on at the AGM urges Nordea to fully commit to ceasing all underwriting and lending related to oil and gas exploration in the region.

Nordea has justified its position by citing the need to secure energy supply. The bank told Net Zero Investor that it maintains a risk-based and highly restrictive approach to the oil and gas sector. “We have reduced our lending exposure to upstream oil and gas companies by 99% since 2019 and completely ceased lending to new customers in the segment. We do not provide dedicated finance to expansion of oil and gas, unconventional oil and gas or Arctic drilling,” a spokesperson said.

However, the bank added: “At the same time, the energy transition is complex, and geopolitical upheaval in recent years has highlighted the critical importance of affordable and secure energy supply. We believe that Nordea can, and should, contribute to both an accelerated transition and energy security priorities in the markets where we operate. This includes the role of the Norwegian energy sector in the transition, and we continue to support a few carefully selected companies that play an important role in ensuring affordable and secure energy supply in Europe.”

With advance voting for the AGM having concluded last week, it has emerged that several of Denmark’s major institutional investors support the resolution.

Danish backing

Ahead of the AGM, two of Nordea’s Danish institutional shareholders—Sampension and AkademikerPension—told Net Zero Investor they intend to vote in favour of the proposal.

“We take a very critical view of fossil fuel expansion,” said Sampension’s Head of ESG, Jacob Ehlerth Jørgensen.

The fund, he explained, recognises there may be “limited room” for near-term fossil fuel investment to safeguard Europe’s energy security. However, such investments must be “strictly constrained and carefully justified.”

“In this context, we do not consider long lead-time projects—such as new developments in the Arctic—to be an appropriate or proportionate response to energy security concerns,” he said.

Jørgensen also emphasised the relatively narrow scope of the proposal, describing it as a limited component of Nordea’s overall financing activities.

“We generally regard Nordea as a progressive institution and an early adopter in sustainable finance, with a strong strategic grasp of the green transition,” he added.

However, Sampension has raised concerns about Nordea’s exclusion of certain activities from its fossil fuel expansion exposure assessment.

“It appears that the company has not provided shareholders with a sufficiently transparent picture of its activities related to the financing of fossil fuel expansion,” Jørgensen concluded after reviewing both the proposal and the board’s response.

Sampension’s support for the resolution is intended as a call for greater transparency.

AkademikerPension’s backing follows similar reasoning. CIO Anders Schelde said the decision builds on ongoing dialogue with the bank.

“While we acknowledge the progress made, our key concern remains unresolved: how continued financing of oil and gas, particularly expansion activities, can be reconciled with the bank’s stated climate ambitions,” Schelde said.

“From our perspective, this inconsistency between targets and actual financing decisions is precisely why we support the proposal,” he added.

AkademikerPension is expected to deliver a speech at the AGM reflecting these concerns.

Investor unease over Nordea’s fossil fuel financing is clearly building. At tomorrow’s AGM, an investor-backed resolution will bring those concerns sharply into focus.

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