Varma is the third pension company in the world to gain validation for its Science Based Targets

Varma is the first Finnish pension insurance company to receive official validation for its emission reduction targets, which are based on the Science Based Targets initiative (SBTi).

The companies that have joined the international SBT initiative commit to reduce their greenhouse gas emissions in line with the Paris Agreement. Varma is the first Finnish pension insurance company and the third pension company in the world to have its science-based targets validated.

“It is very important to us that our climate targets are based on science. The climate is warming at an alarming rate, and emissions must be reduced immediately if we want to stop global warming. We want to be sure that our targets are aligned with international climate agreements,” stresses Hanna Kaskela, Senior Vice President of Sustainability and Communications.

The SBTi has established its position as an international framework for setting companies’ emission reduction targets. It enables private sector companies to define clear and ambitious science-based targets for reducing greenhouse gas emissions.

Varma aims to cut emissions from its own operations by 60 per cent by 2030

Varma’s science-based target is to reduce the greenhouse gas emissions related to its own operations (Scope 1 and 2) by 60 per cent by 2030 compared to the 2021 level. Emissions from Varma’s own operations arise from the use of company cars and the real estate portfolio’s carbon dioxide emissions, which are caused by the consumption of electricity and heat Varma procures for its rental properties, i.e. apartment buildings and office premises. Varma is a major real estate investor in Finland.

In terms of indirect emissions (Scope 3), a target has been set for Varma’s investments in listed equities, corporate bonds and real estate funds. In these asset classes, Varma’s target is to increase the share of companies committed to the SBT initiative to 51 per cent by 2027. In 2021, 28 per cent of these investees had set their own science-based targets.

Listed equities, corporate bonds and real estate funds make up 45 per cent of Varma’s EUR 57.4 billion investment portfolio.

“Our objective is to increase the share of companies that have set science-based targets in our investment portfolio. We encourage companies to set their own climate targets. When our investee companies set ambitious emission reduction targets for their own operations, our overall emissions also decrease. According to our research, 98 per cent of our overall emissions stem from our investees. Due to the nature of our operations, reducing indirect emissions is very significant,” says Kaskela.

What is the Science Based Targets initiative?

The Science Based Targets initiative (SBTi) is a joint initiative of the Carbon Disclosure Project (CDP), the UN Global Compact, the World Resources Institute (WRI) and the World Wide Fund for Nature (WWF). Companies that are part of the initiative set their own short- and long-term targets, which must be validated by the SBTi. Varma’s now-validated targets are short-term targets, and we are also committed to setting long-term targets.

The progress made in achieving the targets is tracked in stages and reported to the SBTi.

The targets of all participating companies are available on the Science Based Targets initiative website

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