Danske Bank Excludes 1,700 Fossil Fuel Companies From Investments

Danske Bank, Denmark's largest bank, has removed over 1,700 fossil fuel-related companies from its investment universe due to their lack of climate change preparation. The bank's exposure remains largely unchanged, and it will continue to invest in companies working in the fossil fuel sector. The cuts affect only a "small part" of overall investments, as the fossil fuel industry makes up a limited share of portfolios.

Copenhagen, Denmark — Danske Bank, the largest bank in Denmark, has recently completed the adjustment of its investment portfolios, removing over 1,700 fossil fuel-related companies from its investment universe. The move is part of the bank's commitment to responsible investing, aligning with the preferences of the majority of its customers. Despite the significant reduction in the number of companies, the bank's overall exposure to the fossil fuel sector remains largely unchanged.

The adjustment, announced earlier this year, is a result of Danske Bank's new methodology for investing in companies operating in the fossil fuel sector. This methodology focuses on companies that have credible transition plans to support the shift to a more sustainable society and to future-proof their business. The bank aims to further align with its customers' investment preferences and underscores its commitment to achieving competitive returns on a responsible basis [1].

The new methodology has led to a significant reduction in the number of fossil fuel companies in Danske Bank's investment universe. While the bank's investment universe included around 2,000 companies involved in fossil fuels in 2024, this number has now decreased to around 270 companies in 2025. Although the methodology has led to the divestment of a number of fossil fuel companies from the portfolios, the overall exposure to companies involved in the fossil fuel sector remains relatively unchanged [1].

Danske Bank's new fossil fuels investment approach aligns with the preferences of the majority of its customers while underscoring its commitment to achieving competitive returns on a responsible basis. The bank's approach is not static and will continue to evolve in line with investor preferences, regulatory developments, and societal developments [1].

The bank's assessment of fossil fuel companies within its new methodology is conducted using the Net-Zero Pathway Framework model, developed in collaboration with the Transition Pathway Initiative (TPI). This model provides a data-driven foundation to determine whether a company has a realistic plan towards a low-carbon transition. The model assesses companies based on two dimensions: management quality and carbon performance [1].

Despite the significant reduction in the number of fossil fuel companies in its investment universe, Danske Bank continues to invest in companies working in the fossil fuel sector to reflect the global economy and global energy supply. However, the bank has decided to become even more selective in its fossil fuels investments for most of its investment products, as it aligns with the majority of its customers' preferences [1].

The bank's approach to investing in fossil fuel companies will continue to evolve in line with investor preferences, regulatory developments, and societal developments. The bank's exposure to the fossil fuel sector is a small part of its overall investments, as fossil fuel companies make up only a very limited share of its portfolios [1].

References:
[1] https://danskebank.com/news-and-insights/news-archive/news/2025/12082025