Dutch pension fund PFZW revealed significant changes in its external investment manager lineup, including pulling approximately €29 billion (USD$34 billion) in mandates from BlackRock and LGIM, as it implements a shift in its investment policy towards a more sustainability and active management focus.

In a statement provided to ESG Today, a PFZW spokesperson said:

“PFZW has been developing a new investment strategy where financial performance, risk and sustainability are weighed equally within the framework of a total portfolio approach.

“In collaboration with its pension fund manager PGGM, in the first half of 2024 the fund completed the selection process for managers who could take on the new listed equity and credit mandates under this Investment Policy 2030.”

The spokesperson confirmed that “we did not renew our contract with Blackrock under our new investment strategy,” although it remains in a Blackrock money market fund. PFZW also confirmed that it did not renew contract with asset managers LGIM and AQR.

PFZW oversees approximately €248 billion in pension assets. BlackRock’s mandate was valued at over €14 billion earlier this year, and LGIM’s at approximately €15 billion.

Under PFZW’s Investment Policy 2030, the pension fund focuses on three pillars, including return, risk and sustainability. The fund’s sustainability approach requires investments to meet minimum standards to limit negative effects, targets companies that contribute to the UN SDGs and the goals of the Paris Agreement, and focuses on investments with measurable social value in key focus areas including climate, people and health, and nature and biodiversity.

In a blog post outlining some of the changes to PFZW’s strategy, PGGM’s Head of Mandate Management Sander van Stijn also revealed that as part of a more active approach under its new policy, PFZW has also significantly reduced the number of companies in its equities portfolio to around 800 from approximately 3,500, and highlighted some of the sustainability improvements in the updated portfolio, including a Paris Alignment score rising to 30% from 23%, and carbon intensity dropping to 73, compared to 249 for the market index.

Van Stijn also highlighted the importance of sustainability factors in management selection for the PZFW portfolio:

“We deliberately seek asset managers who are not only financially strong but who also share our sustainability ambitions. Stewardship is another key focus: do managers actively encourage portfolio companies to become more sustainable through engagement and voting? While we maintain our own voting policy, we want our partners to be as closely aligned with us as possible.”

Van Stijn added that “not all asset managers – particularly in the United States – share the same perspective.”

The PZFW changes highlight the tensions faced by global asset managers dealing with increasingly disparate views over the role of ESG considerations in investment decision making, with political pressure in the U.S. leading some asset owners and funds to exclude managers with a sustainability focus and anti-ESG politicians even warning asset managers against considering sustainability factors, while European funds often require a more active sustainability focus in their mandate considerations.

As part of its efforts to address these challenges, BlackRock introduced a Voting Choice program allowing investors to vote proxies according to their own policies, as well as Climate and Decarbonization Stewardship Guidelines, setting out separate engagement and voting policies for investors specifically focused on the low carbon transition.

In a statement provided to ESG Today, a BlackRock spokesperson said that the firm “noted PFZW’s redemption in the first half of 2025 and are proud to have helped their 3 million participants prepare for their long-term future by consistently delivering on the investment objectives set out in their mandate with BlackRock.”

The spokesperson added:

“BlackRock clients – including our Dutch clients – continue to invest through BlackRock to meet their sustainable investing goals, entrusting us to manage over $1 trillion in sustainable and transition assets on their behalf.”

Asset managers selected for PFZW’s more active equity strategy include Robeco, Man Numeric, Acadian, Lazard, M&G, Schroders, UBS and PGGM.