Sitra as an investor
Sitra’s work for the future is funded by the returns from its capital. Responsibility is an essential part of Sitra’s operation – also as regards investment activities.
What is it about?
The Bank of Finland and the Finnish Parliament gave Sitra an endowment capital of approximately 84 million euros. This endowment capital has laid the foundation for Sitra’s current investment assets, the returns on which provide financing for the future-oriented work at Sitra.
At the end of 2021, the market value of all Sitra’s investment assets was 1 107 million euros.
Figure 1. Investments by asset type at the end of 2021
In the year 2021, the investments yielded a return of 16.6 per cent. Taking inflation into account the real return was 13.1 per cent. The five-year average annual return on investments was 9.3 per cent and the average annual real return 8.1 per cent.
Sitra’s investment assets are mainly invested in funds. Sitra makes the decisions on the allocations, but the funds decide on the individual investment targets independently, as per the fund’s rules.
No new corporate investments have been made since 2014. At the end of 2021 Sitra’s investment portfolio still included seven companies.
We manage Sitra’s investments in a secure and profitable manner. ESG integration means that in addition to risk and return, environmental, societal and corporate governance (ESG) issues are included in all investment decisions.
The UN Principles for Responsible Investment (PRI) serve as instructions and guidelines for Sitra’s responsible investment activities. Sitra signed the PRI in 2015 and committed itself to the following six Principles:
- We will incorporate environmental, social and corporate governance (ESG) issues into investment analysis and decision-making processes.
- We will be active owners and incorporate ESG issues into our ownership policies and practices.
- We will seek appropriate disclosure on ESG issues by the entities in which we invest.
- We will promote acceptance and implementation of the Principles within the investment industry.
- We will work together to enhance our effectiveness in implementing the Principles.
- We will each report on our activities and progress towards implementing the Principles.
National legislation and the international UN Global Compact principles governing business and society are taken into account when addressing responsibility. The UN Global Compact includes 10 principles concerning the environment, corruption, human rights and labour. They serve as an international framework for Sitra’s responsible investment activities.
Sitra’s investments are mainly made through funds. Therefore, we require that our asset managers actively monitor companies’ ESG issues as part of their investment activities. The minimum requirement for fund investments is that the asset manager has signed the PRI or has a responsible investment policy.
We develop our responsible investment practices regularly.
Have a look at Sitra’s guidelines for responsible investment (updated in April 2021) and at Sitra’s climate strategy for investments.