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Change the world, start with your pension fund

09/10/2025
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By Marc Hutten

What exactly does a sustainable investor buy? The previous column on this site by Harald Walkate prompted reflection on the motives driving sustainable investors. Ultimately, these can be traced back to a combination of three objectives:

  • Peace of mind. Sustainable investors maintain a “moral baseline.” They avoid investing in tobacco companies or the fossil fuel industry, given the social and environmental damage these sectors cause.

  • Better returns or lower risks. This goal, of course, is not exclusive to sustainable investors; every investor seeks to avoid risks—including ESG risks—and to capture returns from opportunities created by sustainability trends.

  • A better world. Beyond financial return, sustainable investors explicitly pursue a form of societal return that can and should be clearly defined.

On that last point, investors must think carefully about what kind of impact they wish to achieve—ecological, social, local, or global—and how to realise it.

Most sustainable funds invest in public markets, buying shares of listed companies. This means the fund’s money goes to the sellers of those shares, not to the companies themselves. The capital, therefore, does not directly fund the enterprises striving to improve society or the planet—the very purpose many sustainable investors hope to serve. This concept is known as “additionality”: the notion that an investor’s capital enables activities that would not have occurred without it.

Within this framework, we distinguish between investor contribution and investee contribution.

  • Investor contribution refers to the investor’s added value—beyond capital—such as management support, expertise, networks, and strategic advice. The aim is to strengthen the enterprise and enhance its growth and impact. Engagement also falls under this heading: through dialogue, demands for improvement, and, if necessary, escalation, an investor can truly make a difference.
  • Investee contribution refers to the enterprise’s own achievements: tangible results, growth, and impact. Here, the sustainable investor’s broader objectives—social impact, or the success of a particular project—are central. In other words, impact that delivers a net positive value to society.

Public versus private markets

The investor’s contribution varies between public and private markets. In public markets, the investor’s potential influence is generally more limited and indirect. In private markets, it tends to be greater and more direct: impact objectives can be written into financing terms or embedded in company operations. Influence increases with the size and strategic importance of the investment—through capital size, subordination, or duration—and also with the investor’s expertise and trusted relationship with the company.

For investors who genuinely wish to make the world a better place by enabling sustainability solutions that otherwise would not happen, private markets typically offer a far greater potential for investor contribution. Here, capital flows directly into projects—building wind farms or providing microfinance—rather than to another shareholder on the secondary market.

Access to private markets

Private market investments are largely out of reach for most retail investors. Yet individual investors can still make a major contribution through their pension funds, for two key reasons:

  1. For most individuals, the majority of their total investable wealth sits in their pension pot.
  2. Pension funds can invest in private markets.

Measuring the positive (and negative) societal impact of investments is complex but rapidly evolving. Increasingly rich data on the effects of both public and private companies are becoming available. These insights should be used to assess the true extent to which investment and pension funds contribute to a better world.

Translating these impacts into accessible, comprehensible language is essential—allowing investors to make informed choices about where their capital can do the most good. And those investors are often also pension fund participants. They hold a powerful key: the ability to engage more actively with their own pension fund.

I am convinced that, for private individuals, the greatest investor contribution and societal impact arise not from stock-picking, but from engaging with their pension fund to drive real-world change.


About the author

Marc Hutten is an Investment Solutions Specialist at Achmea Investment Management. He is responsible for innovation and product development with a focus on Impact Investing and ESG. From 2016–2021, he served on the board and risk committee of Stichting Pensioenfonds Achmea. Marc previously worked as a portfolio manager and has extensive experience in both quantitative and fundamental equity research and management. He holds an MSc in Business Economics from the University of Groningen and an MSc in Investment Management from VU Amsterdam. He is a CEFA charterholder (VBA).


This translation was generated with the assistance of AI. The original Dutch version, which remains the authoritative source, is available at: https://www.dsi.nl/actueel/verbeter-de-wereld-begin-bij-je-pensioenfonds/

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