Nordea is to stop investing in food commodities because of the negative effects speculative investing in the asset class has on the world's poor, according to a statement by Sasja Beslik, who heads the Nordic bank's fund business Nordea Fonder.
The bank made the announcement via a statement on its local language website for the Swedish market.
The statement translated reads:
Why has Nordea taken this decision?
"There has been a lot of research into how trade in commodities pushes up prices and the results are clear. The financial industry's move into the area has, combined with the growth in global population, delivered higher prices and greater price volatility. This hits those who are most sensitive to price changes. We have therefore decided that Nordea should completely avoid investments in and trade in food commodities," said Beslik.
There are those who suggest that the trade in commodities does not have any negative effect on consumers. How to you view that?
"I find that hard to understand. Of course it will affect people who live on a dollar a day if the price of wheat goes up by 70% in a year. Our business as financial players is to trade in the market with the target of generating profit, but that cannot happen at any price. We believe that there are other products we can offer our customers, which deliver both a good return and respect people and the environment. We have had a positive response from our customers for our positioning on this and it is important for us."
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