Annual and Sustainability Report: In 2023, we comprehensively promoted sustainability and prepared for the sustainability reporting directive


In 2023, we continued to develop the different areas of sustainability. We assessed fund management companies’ sustainability and how prepared our investees are to consider biodiversity, and we looked into the standard of our suppliers’ human rights work.

Varma’s Annual and Sustainability Report 2023 has been published. We report on our key operational results and sustainable actions from the perspectives of pension cover, investments and sustainable working life.

“Sustainability is a topical issue now from many angles. In Europe, the EU’s Corporate Sustainability Reporting Directive makes voluntary reporting requirements mandatory as of this year, and sustainability will be increasingly embedded in boards of directors’ tasks. On the other hand, sustainability is becoming politicised in the US, which is reflected in, for example, responsible investment,” Varma’s Hanna Kaskela, Senior Vice President, Sustainability & Communications, points out.

“In 2023, we broadly developed the different areas of sustainability at Varma and worked towards our sustainability targets. We assessed fund management companies’ sustainability and how prepared our investees are to consider biodiversity, and looked into the standard of our suppliers’ human rights work,” Kaskela adds.

Climate allocation accounts for nearly 40% of the investment portfolio

Adapting to and mitigating climate change is one of Varma’s key sustainability targets. In 2023, Varma received validation for its GHG emission reduction targets, which are based on the Science Based Targets initiative (SBTi), making it Finland’s first earnings-related pension insurance company and the world’s third pension insurance company to receive this validation.

“We joined the SBT initiative to make sure that our climate targets are aligned with international climate agreements. Varma’s now-validated targets are short-term targets, and we are also committed to setting long-term targets,” stresses Kaskela.

Our SBT target is to reduce the greenhouse gas emissions related to our own operations by 60 per cent by 2030 compared to the 2021 level and, as regards our investments, to increase the share of companies committed to the SBT initiative to 51 per cent by 2027.

Through long-term work, we have raised the proportion of climate-friendly investments in our investment portfolio. At the end of 2023, the climate allocation, which covers all asset classes, accounted for 37 per cent, i.e. EUR 21.9 billion, of Varma’s investments. The allocation includes, for example, companies that have set SBT targets and offer climate solutions.

“We tightened our climate allocation target in 2023, and we aim to increase the allocation’s proportion of our investments to 50 per cent by 2027,” Kaskela says.

Sustainability reporting introduces new sustainability disclosure requirements

The EU’s Corporate Sustainability Reporting Directive (CSRD), which is being phased in from the start of 2024, introduces new sustainability disclosure obligations for Varma’s 2024 financial statements.

“We started to prepare for the directive last year. The biggest effort was the double materiality assessment,” Kaskela says.

Material sustainability topics highlighted by the assessment were, on one hand, the climate and human rights impacts of investments, and, on the hand, systemic risks to the investment portfolio caused by climate change and biodiversity loss, and risks caused by human rights and good governance violations. Material topics in terms of our own operations include the realisation of customer rights, securing income and issues related to sustainable business. Further material topics that were identified include influencing the climate impacts of our own operations and taking care of the work conditions and equality of our employees.

Varma is the most solvent earnings-related pension company

Last year was divided in terms of the economy. Inflation and interest rates levelled off, but in Finland, the economic mood remained gloomy. The investment year was also divided, as there were exceptionally large differences within the investment portfolio by geographical areas and asset classes. In spite of some fluctuations during the year, investment returns showed an upward trend.

Varma’s core task of securing pensions and pension payments is something the company adheres to in all market conditions. Our solvency remained at a secure level all year, and Varma is the most solvent earnings-related pension insurance company in Finland.

Our Annual and Sustainability Report complies with the Global Reporting Initiative (GRI) reporting framework and has been externally assured. We report on biodiversity for the first time, adapting the requirements of the new Taskforce for Nature-related Financial Disclosures (TNFD) framework.

The Annual and Sustainability Report 2023 has been published online as an accessible PDF at

Further information

Hanna Kaskela, Senior Vice President, Sustainability & Communications, tel. +358 40 584 5045 or hanna.kaskela(at)

Hanna Leskelä, Communications Manager, tel. +358 40 704 5164 or hanna.leskela(at)



Varma Mutual Pension Insurance Company is a responsible and solvent investor of pension funds. The company is responsible for the statutory earnings-related pension cover of 980,000 people in the private sector. Premiums written totalled EUR 6.5 billion in 2023 and pension payments stood at EUR 7.1 billion. Varma’s investment portfolio amounted to EUR 59.1 billion at the end of 2023.

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