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Painting of a man smoking a cigar in front of a fan
SKAGEN does not invest in companies which derive more than 5% of their revenue from tobacco. Vilhelm Rosenstand. By Peder Severin Krøyer, 1886. This painting is manipulated and belongs to The Art Museums of Skagen.

SKAGEN’s funds all follow our group-wide sustainability policy. When selecting companies to invest in, we evaluate environmental, social and governance (ESG) factors before we make any decisions. In addition, we have chosen to exclude investments in companies within certain product categories or industries that we deem unsustainable. These products or industries are associated with significant risks and liabilities from societal, environmental or health-related harm. In these product categories, there is also limited scope to influence companies to operate in a more sustainable way.

These include:

  • Companies with more than 5% of revenue from tobacco
  • Companies with more than 25% of revenue from coal-related activities
  • Companies with more than 20% of their revenue from oil sands 
  • Companies with gambling operations
  • Owners of palm oil plantations with unsustainable business practices

Sustainability is part of the investment process

Beyond this, we seek to incorporate material sustainability issues into every investment case, including climate-related risks and opportunities. We will not make any investments unless we have a clear view and the extent of our clarity will subsequently influence the conviction we have in an investment case through position sizing and our assessment of the potential upside.

For example, if buying into an insurance company, our portfolio managers will be mindful of its exposure to risks related to climate change and rising sea levels. We will also evaluate the risks and opportunities of our exposure to fossil fuel, such as through oil and natural gas companies.

Positive change can take time

We also believe that ESG matters are not symmetrical in how they will influence an investment case. The trajectory of environmental improvements can be quite long, while the downside of an environmental accident can be immediate.

Likewise, the effect of social improvements is typically long-term in nature and will often exceed our usual investment horizon of 3-5 years. However, as with environmental fallout, social issues can cause short-term damage to a company’s reputation and valuation.

Governance is probably the ESG factor that has the most immediate impact on both a company’s upside and downside. A CEO or Chairman stepping down can trigger a positive re-rating or cause a sudden fall in a company’s share price. A poorly run company that does not treat its minority shareholders correctly deserves a lower valuation than one that is well run and respects its owners.

Active and engaged owner

SKAGEN has a history of engaging with companies and being a very active owner. This means we will exercise our voting rights at shareholder meetings and communicate with the companies we own. This dialogue with our investments comes through one-on-one meetings, conference calls or written dialogue. Through this process we will make our views heard and try to influence the company to make improvements in any areas we believe they are needed.

Throughout SKAGEN’s history we have been active in trying to influence companies in the right direction. However, sometimes the ability to influence is limited and we have instead decided to divest.

Read more:

An active and value based investment philosophy


Historical returns are no guarantee for future returns. Future returns will depend, inter alia, on market developments, the fund manager’s skills, the fund’s risk profile and management fees. The return may become negative as a result of negative price developments. There is risk associated with investing in funds due to market movements, currency developments, interest rate levels, economic, sector and company-specific conditions. The funds are denominated in NOK. Returns may increase or decrease as a result of currency fluctuations. Prior to making a subscription, we encourage you to read the fund's prospectus and key investor information document which contain further details about the fund's characteristics and costs. The information can be found on Storebrand Asset Management administers the SKAGEN funds which are by agreement managed by SKAGEN's portfolio managers.