ABP Annual Report 2021

Annual
Annual
Report
Report 2021
2021
ABP Annual Report 2021 2
Contents
The value of pensions Contributing to solutions 21
for societal challenges
With well over 3 million participants, we are the largest pension fund in the 'Fossielvrij NL' is building a civil movement to
Netherlands. As such, we do not only look after our participants’ old-age
break the power of the fossil fuel industry.
provision. We also aim to give them transparency, insight and guidance
“By ceasing to invest in fossil fuel producers,
regarding financial matters, and ensure a pleasant living environment in
which they can enjoy their pensions. This means pensions represent value ABP is sending a strong signal,” comments Liset
in a variety of ways. In five special pages in this report, a number of Meddens, founder of Fossielvrij NL.
stakeholders share their perspective on how pensions generate value.
Peace of mind 30 Personal motivation 35
When asked about the value of pensions, Director Anke Cornelissen is a portfolio manager at APG.
Arjan Vliegenthart of the Dutch National Institute She and her team invest in government bonds
for Family Finance Information (Nibud) responded across developed markets, including Europe,
in a heartbeat, “A pension is peace of mind. America, and Australia, while closely monitoring
Knowing that you’ll be able to do the things you market and portfolio developments. She works
planned for during your working life.” for the benefit of ABP’s participants. To her,
pensions represent personal growth and pride.
Freedom 50 Attractive employment benefit 78
Former child psychologist Alex Ghys leads group Jan van Geloof is HRM policy officer at Breda
tours in the Gallo-Roman Museum in the Belgian University of Applied Sciences (BUas). His
city of Tongeren and is a city guide in Hasselt. work mainly concerns employment benefits,
It was his work that led Alex, a Belgian born legal matters, social security, tax matters,
and raised, to step across the border to the and pensions.
Netherlands at the time. He took retirement at
age 61 and is now enjoying life on his own terms
to the full.
ABP Annual Report 2021 3
ABP at a glance 4 Financial statements 127

Profile 5 Company financial statements 128
Key figures 6 Consolidated financial statements 189
Multiyear figures 7
How ABP adds value 9
Value creation model 10
Other information 217
Provisions in the Articles concerning profit appropriation 218
Actuarial Statement 219
Report of the Board of Trustees 12 Independent auditor’s report 221
Preface 13 Assurance report by the independent auditor 235
Trends and developments 17
Strategy and progress 22
What is important to our stakeholders 26
Results: Financial performance 31 Supplementary information 239
Results: Sustainable and responsible investment 36 About this report 240
Results: Equilibrium between contribution, certainty, 51 Personal details 242
and ambition Abbreviations and definitions 250
Results: Sound management of the pension assets 55
Risk management 79
Governance 88
Reader’s guide
Pensions are a complex subject. Our annual report furthermore needs to include certain
mandatory components. Although we aim to explain everything to our readers in the
Accountability and supervision 96 clearest possible way, it is not always possible to avoid the use of fixed terminology. This
Report of the Supervisory Board 97 terminology is explained or defined in the Glossary at the end of this annual report.
Report of the Accountability Body 110
Opinion of the Accountability Body 119 The original Annual Report was drafted in Dutch. This document is an English translation
of the original. In case of any discrepancies between the English and Dutch text, the latter
will prevail.
Contents ABP at a glance ABP Annual Report 2021 4
ABP at a glance
Contents Profile ABP Annual Report 2021 5
Profile
More than 3 million participants and almost 3,500 employers in the
government and education sectors, as well as a number of affiliated Get to know ABP
independent employers, have their pensions with ABP, one of the largest
Building a good pension together
3.1 3,468
pension funds in the world. Our duty is to implement the pension scheme
as adopted by the employers’ and employees’ organizations in the Pension million
Board. The strategy and policy in this regard is set out by ABP, whereas participants employers
the implementation has been outsourced to APG. ABP has offices in Heerlen
and Amsterdam.
Our mission is “Building a good pension together.” We are convinced of the Core values
power of sharing risks and gains, and of benefiting from economies of scale.
Participants and employers pay contributions that we invest in a professional, We are engaged with each participant
sustainable and responsible manner to accrue and preserve pension capital.
We are the pension experts for our participants,

Our goal is to be the preferred pension fund for participants and employers. our employers, and society
We realize our goal by putting our clients at the center of our services, by
making every effort to provide good, personal pensions for the future, and by
ensuring that pensions are always an appealing fringe benefit. We work on a sustainable pension
in a sustainable world
€551.6 42
billion employees at
available year-end
assets (41 FTE)
Contents Key figures ABP Annual Report 2021 6
Key figures 2021

Year-end results
Performance in 2021 and goals for 2025
Sustainable and responsible investment

% of assets invested in SDGs 18.1%
Active participants Pension contributions Funding ratio Goal for 2025 20%
1,203,358 12,720 110.6% Invested in SDG 7

Affordable
(€ million)
and sustainable energy €18.5 billion
2020: 1,178,215 2020: 11,741 2020: 93.5%
Goal for 2025 €15 billion
Former participants Benefits Policy funding ratio CO2 footprint of equities portfolio
940,146 12,908 102.8%

compared with 2015 -48%
Goal for 2025 -40%
(€ million)
2020: 930,241 2020: 12,382 2020: 87,6%
Pensioners Provision for pension Discount rate NPS
974,772 liabilities
0.57% Participants Employers
498,797 -23 +22

(€ million) 2020: -28 2020: +17
2020: 943,318 2020: 529,865 2020: 0.19%
Increase
Affiliated employers Available assets Total return Ambition on 1 January
3,468 551,644 11.4%

2021 0.71% 2020 2.84%
2020: 3,557
(€ million)
2020: 495,335 2020: 6.6%
Actual
2021 0% 2020 0%
For an explanation of the terms used, see the glossary on page 251.
Contents Multiyear figures ABP Annual Report 2021 7
Multiyear figures
2021 2020 2019 2018 2017
Total assets (A) (in € mln) 551,644 495,335 465,619 398,971 408,838
Retirement and surviving dependants' pensions 496,768 527,935 473,558 409,486 390,145
Incapacity pension 1,912 1,832 2,664 1,414 1,397
Policyholders' risk 117 98 108 108 110
Provision for pension liabilities (B) (in € mln) 498,797 529,865 476,330 411,008 391,652
General reserve (C= A-B) (in € mln) 52,847 -34,530 -10,711 -12,037 17,186
Funding ratio (A/B) (in %) 110.6 93.5 97.8 97.1 104.4
Discount rate as at year-end (in %) 1
0.57 0.19 0.74 1.39 1.48
Policy funding ratio (in %) 102.8 87.6 95.8 103.8 101.5

Minimum capital requirement (+ 100) 104.2 104.2 104.2 104.2 104.2
Capital requirement (+ 100) 126.3 125.8 126.7 128.2 128.2
Real funding ratio (in %) 83.6 72.1 77.5 84.9 82.8
Future-proof indexation funding ratio (in %)2 123.0 121.4 123.6 122.2 122.6
Pension contributions (net) (in € mln) 12,720 11,741 11,041 10,267 9,064
Pensions (in € mln) 12,908 12,382 11,597 11,110 10,699
Numbers (year-end)
Participants 1,203,358 1,178,215 1,150,592 1,128,671 1,111,106
Former participants 940,146 930,241 954,702 952,476 946,097
Pensioners 974,772 943,318 910,741 886,529 868,454
Total 3,118,276 3,051,774 3,016,035 2,967,676 2,925,657
Affiliated employers/sub-employers 3,468 3,557 3,593 3,643 3,691
Employed by ABP (average) 42 43 43 42 43
Employed by consolidated entities 3,124 3,013 2,939 3,152 3,186
1 On the basis of the nominal interest rate term structure published by De Nederlandsche Bank
2 This is based on the amended ambition and/or price indexation as at 1 January 2016
Contents Multiyear figures ABP Annual Report 2021 8
2021 2020 2019 2018 2017
Other information
Contribution rate for retirement and surviving dependants' pensions in % 24.4 22.4 22.9 21.9 21.1
Contribution rate and recovery supplements 1.5 2.5 2.0 1.0 -
Contribution rate for incapacity pension, average (in %) 0.7 0.8 0.5 0.5 0.4
Price indexation (in %)1 2.39 0.71 2.84 2.08 1.38

Indexation declared for coming year (in %) 0 0 0 0 0
Cumulative indexation arrears (in %) 2
22.82 19.95 19.11 15.82 13.46
Asset management expenses in % (excl transaction costs 0.12% in 2020) 0.98 0.66 0.57 0.6 0.65
Transaction costs 0.10 0.12 0.09 0.10 0.12
Pension administration costs per participant (in €) 72 67 68 72 76
Service score (CEM max = 100) 3 4
80 87 86 91
Net Promotor Score pension (NPS)5

- New participant -13.9 -19.7 -32.3 n.v.t n.v.t
- Retiring 8.8 8.5 5.6 n.v.t n.v.t
Z score -0.1 1.1 -1 0.7 0.9

Performance score (norm: > 0) 2.0 2.2 2.4 3.5 3.8
Return total (= direct + indirect, in %) 11.4 6.6 16.8 -2.3 7.6

Total return, 3-year average (in %) 11.5 6.8 7.1 4.8 6.5
Total return, 5-year average (in %) 7.9 7.5 6.7 6.2 8
Total return, 10-year average (in %) 8.5 7.7 8.4 8.7 6.5
Total return, 15-year average (in %) 6.7 6.6 7 6.6 7.6
1 Consumer Price Index (CPI) from CBS (period 9-1-20 till 9-1-21).
2 Calculated from the introduction of the average salary scheme (2003)
3 Figures for the period 2014-2017 retroactively adjusted due to change in CEM calculation method.
4 The service score 2021 will only become available after publication of the annual report.
5 As of 2019, customer satisfaction will be measured via NPS scores.
Contents ABP Annual Report 2021 9
How ABP adds value

With well over 3 million participants,
we are the largest pension fund in the
Netherlands. As such, we not only look after
our participants’ old-age provision, we also
endeavor to give them transparency, insight,
and guidance when it comes to financial
matters. Moreover, we aim to ensure that
they can enjoy their pensions in a pleasant
living environment. This means pensions
represent value in a variety of ways.
Contents Value creation model ABP Annual Report 2021 10
How ABP adds value – Overview

Social contribution
Input Strategy and implementation Adding value for Output and impact
inistering and
Adm anaging p
m ens Pension value for all Confidence in their
i on
Human and intellectual s participants pension
Largest pension fund Income and improved
Participants
in the Netherlands prosperity
Sharing and managing
risks together
Building
g c le ar ly
in g in si g h t
a good Return and
pension funding ratio
together
d o ic a ti n
Social and relational
D eli
Employers
ff er
an m u n
Participants
ver mu m
o pt
Pension as an
in
appealing fringe
i
Employers
m
g
benefit
Co
Social relations tu
re
rn
s
Financial Cost-conscious administration Livable world Sustainable and

responsible
Opening balance Sustainable and responsible asset
investment
available assets management
Contribution
to a livable
world
Contents Value creation model ABP Annual Report 2021 11
How ABP adds value

Strategy Social contribution
Input and implementation Adding value for Output and impact
Pension value for all participants Confidence in their pension
Average increase in value Number of participants

Human and intellectual of contribution 200 – 300% receiving an ABP benefit at
Largest pension fund Participants the end of 2021:
Average net pension
in the Netherlands benefit in 2021 €10,110 Retired employees 713,226
100+ years of pension
Increase/reduction in pension 0 Surviving dependents 206,065
expertise, experience,
and insights Participant satisfaction Persons with an
Building
a good incapacity for work 47,422
pension
together
Social and relational Employers Return and funding ratio Pension as an appealing
fringe benefit
Participants 3.1 million Funding ratio 110.6%
Employee commitment to
Employers 3,468 Year-end available
assets €551.6 billion employer
Annual return 11.4%

Five-year return (average) 7.9%
Financial Cost-conscious administration Livable world Sustainable and responsible Contributing to a livable
investment world
Opening balance Pension management admini- Climate change and
available assets stration costs per participant energy transition Investing in green, social, % of assets invested
€495.3 billion €72 and sustainable bonds €14.9 billion in SDGs 18.1%
Conservation of natural
Pension contributions Asset management costs resources Reduction of CO2 footprint 48%
in 2021 1.08% of invested assets
Digitalization
€12.7 billion
Sustainable and responsible of society
asset management
Contents Report of the Board of Trustees ABP Annual Report 2021 12
Report of the Board of Trustees

Preface
There is a lot of unrest in the world right
now, not only as a result of the ongoing
COVID-19 pandemic, but very much also due
to the threat and uncertainty surrounding
the Russian invasion of Ukraine and the
shocking violence this has brought. Our
thoughts are with all people in Ukraine and
their family and friends. All of this means
our review of the past year comes at an
extraordinary time.
Contents Preface ABP Annual Report 2021 14
Against this backdrop of global events, the ABP Board of Trustees reflects good guidance and transparency during this transition. Both the transition
on a year that has also raised a number of questions for our participants and the new pension scheme must be well-balanced, thorough, and easy
and employers. to understand.
The lack of an increase in pensions in particular continued to occupy minds,
with many participants expressing concern and dismay in this regard. Although
ABP offers pensioners certainty in the form of monthly pension payments, Participants must receive what they are entitled to
it is understandable that dissatisfaction regarding delayed pension increases
continues to mount, not least because our financial position improved in 2021. Participants must receive what they are entitled to, both now and in the
future, when the new pension contract is introduced. If we are to deliver
this ambition for each and every one of them, our pension administration
Financial position improved records must be accurate. The scale of our pension fund and its history, which
saw many transitional schemes, mean that our administration has become
At the end of December, our funding ratio reached its highest level since increasingly complex. In 2021, we continued our efforts to review and improve
2011. Our investors achieved great results, and interest rate increases also those records. This major project is being executed by ABP and APG with
provided a boost. The threat of pension reductions, which still loomed large great urgency and dedication. Any errors identified are resolved, missing
in 2020, would therefore seem to have dissipated. As we move towards the details are supplemented, and participants are informed and compensated as
new pension contract, ABP has advocated in recent years for an option that appropriate. One in six Dutch residents will receive a pension from ABP, now or
will allow pensions to be increased sooner. Should this become a reality, it in the future. We are responsible for ensuring they all receive the benefits they
is the intention of the Board to make use of that option. At that time, we are entitled to.
will take a decision after a balanced consideration of the interests of all our
stakeholders. In this regard, it is unfortunately necessary to recognize that
the current turmoil across the globe and on the financial markets brings
additional uncertainty.
In 2021, the government continued work on the introduction of the new

pension system. ABP and social partners have begun work on a design
for a suitable pension scheme for participants and employers. The target
date for implementation is January 1, 2026. Although this might appear very This is the second reporting year in which we publish
distant, a great deal of preparation is still needed. Our Accountability Body is an integrated annual report, introducing further steps in
closely involved in this process too. In collaboration with APG, we launched a
comparison with last year. The report illustrates the results
comprehensive program to facilitate careful preparation for and delivery of the
transition. We believe it is important to offer our participants and employers we achieved in 2021 for our participants and employers.
Raising the bar for sustainable and responsible investment governance of the fund. We greatly appreciate these efforts by the members of
the Supervisory Board and its Chair, Huub Hannen.
In 2021, VBDO named ABP as the most sustainable Dutch pension fund for the
fourth year in a row. This is a brilliant achievement. At the same time, however,
the Board of Trustees feels that we should aim higher still. We are raising our Word of thanks
ambitions and have already taken a first step towards this in the reporting
year, in deciding that we will divest from all fossil fuel producers by early The Board of Trustees also wishes to thank our participants, employers, social
2023 at the latest. This major decision reflects our desire to achieve the goals partners, members of the Accountability Body, ABP and APG employees,
set out in the Paris Climate Agreement. Our aim is to make our Sustainable and other stakeholders who have collaborated with ABP for their trust and
and Responsible Investment policy more ambitious, in order to make an even constructive contributions towards the fulfillment of our mission – building a
greater contribution to a livable world in which our participants can enjoy their good pension together.
pensions. A specific goal for 2022 is to further tighten our inclusion policy.
Over the past year, we said farewell to four members of the Board of
Trustees. We are grateful to Jan van Zijl for his contribution. His broad
New governance model management experience gave him a keen grasp of the expectations of
employers, participants, and other stakeholders towards ABP, and in the
In view of all the challenges ahead, we made preparations in the reporting year capacity of Vice Chair, he also assumed a leading role in the changes to our
for the introduction of a new governance model with effect from January 1, governance. Menno Snel became known to us as an experienced and driven
2022. This is necessary to help us respond better to the strategic challenges Trustee, and we are grateful to have benefited from his expertise.
facing ABP, including the introduction of the new pension contract. The aim
of this new governance model is to increase our organization’s agility and
responsiveness. We have worked closely with our Accountability Body, the
Supervisory Board, and social partners to create a design suited to ABP, which
firmly embeds our connection with participants and employers and safeguards
a strong position. This change is explained in this annual report.
The new governance model assigns responsibility for internal supervision to
the non-executive board. As of January 1, 2022, the Supervisory Board is
therefore no longer part of ABP’s governance structure. Over the years, our In 2021, VBDO named ABP the most sustainable Dutch
Supervisory Board has carried out its supervisory activities in a professional, pension fund for the fourth year in a row. This is a brilliant
constructive, and critical manner and has challenged the Board of Trustees
achievement. At the same time, however, the Board of
from time to time, thus contributing substantially to the quality of the
Trustees feels that we should aim higher still.
Mariette Doornekamp, over the course of many years, used her expertise in
finance and investment to make a significant contribution to the design of
our investment policy, including our Sustainable and Responsible Investment
policy. She also has our gratitude, as does, last but not least, Philip Stork.
Using his experience in risk management, Philip helped to shape our risk
policy and control, particularly in relation to investments. The departure of four
Trustees also means welcoming four new non-executive directors. Supported
by the experience of the current non-executive directors and collaborating with
the new Executive Board, they will use their fresh energy to promote good
governance of the fund for the benefit of our participants and employers.
Closing words
In a world characterized by profound unrest and uncertainty, we will gear

ongoing efforts throughout 2022 towards the accrual and payment of a good Corien Wortmann-Kool Harmen van Wijnen
pension, with a view to providing financial peace of mind wherever we can. Chair of the Management Board Chair of the Executive Board
Although the challenge is immense, we firmly believe that the ABP pension
fund is in good shape to continue to provide a robust financial foundation for
our 3.1 million participants.
Contents Trends and developments ABP Annual Report 2021 17
Our environment
in 2021
In terms of challenges, 2021 very much
proved itself equal to 2020. At an
international level, we noted a growing
sense of urgency to protect our climate.
The COVID-19 pandemic continued to play a
large role in our daily lives. A topical issue
in the area of pension, with urgency for
participants in particular, was the absence
of pension increases. This section delves into
the most important developments in 2021.
Participant expectations – disappointment over the lack of Representatives on March 30, 2022. ABP was pleased to see this, as
of increases it signifies another step towards the necessary adjustment of our pension
system. The act is planned to enter into force in 2023. The publication and
Positive developments on the financial markets are leading to growing subsequent review in parliament will offer pension funds, and therefore also
disaffection with and incomprehension of the inability to increase pensions, participants and employers, greater clarity. At the time of publication, ABP
which has now continued for several years. Research carried out by ABP at called upon the House of Representatives and the Senate to keep the NPC
the end of 2020 revealed that a large majority of participants surveyed had simple in the interest of participants and allow funds the scope to arrange the
a negative or very negative response to the indexation arrears as estimated implementation in a way that serves participants best. A key area for attention
by participants themselves. More than 20 percent perceived this to be an will be the timely involvement of participants. ABP will continue to provide
injustice or great injustice, with this sentiment almost doubling amongst retired input that will help to guide the Future of Pensions Act towards the finishing
workers. Another 12 percent felt there is no choice but to accept this, and only line. Based on our experience and expertise, we have been afforded the
4 percent indicated understanding. opportunity to share our vision and advice with policymakers and politicians.
Like other pension funds, ABP follows the rules that currently apply. At the Our view is that the NPC offers a pension that is more personal and more
request of the House of Representatives, the state secretary has presented responsive to economic developments, whilst preserving the advantages of
a plan to lower the 110 percent threshold. This plan would essentially create acting collectively and sharing risks. The disadvantage is that our participants
scope for pension funds to increase pensions as soon as the funding ratio is and employers are aware that a major change is coming, and we can offer
at 105 percent or higher. If the plan is adopted, the law will allow pension them little clarity at this time, including with regard to the impact of the
funds to decide to increase pensions sooner. Whether a fund would actually transition from old to new. This could cause disquiet.
proceed to do so depends on a number of factors. For example, when
the board of a pension fund decides to increase pensions, it must make a
balanced assessment.
ABP’s approach to this is described in the following section: Equilibrium

NPC program launched
between contribution, certainty, and ambition.
The transition to the NPC is a complex and wide-ranging process.
To address this, ABP created a special program, which continued
to build pace in 2021. In this context, ABP is working in close
Run-up to the new pension contract has begun
collaboration with APG, with ABP acting as the coordinator. This
role means ABP sets out the policies, monitors frameworks and
The run-up to the new pension contract (NPC) has begun. The reporting
progress, and has responsibility for the execution, which includes
year included an announcement that the legislation had been delayed. The
the selection and implementation of a new administrative system.
Future of Pensions Act (Wet toekomst pensioenen) was sent to the House
The process also involves external advisers.
The task for social partners is to decide on how to reflect the NPC in It is fairly unusual to see high returns coupled with net interest rate increases.
employment terms and how to amend schemes that do not align with this. Top years for investment returns are typically accompanied by a drop in
ABP advises social partners on these matters, with our Accountability Body also interest rates. The prevailing circumstances in 2021 – high returns and interest
fulfilling a key advisory role in the process. rate increases – had a favorable effect on our funding ratio, given that liabilities
decreased in value while there was a net increase in the value of assets. At the
The transition to the NPC requires our records to be up to the mark. A large same time, there was a marked increase in inflation, which hit our participants’
number of pension funds are working to clean up their data and systems. This pockets. The persistent nature of price increases has raised expectations of
is also a subject for increased scrutiny by our regulator DNB. In order to make future interest rate increases. More detail on this is provided in the following
improvements to the services provided to participants and employers, ABP has sections: Financial performance and Sound management of pension assets.
already been working to improve data quality for some time. Meanwhile, the
wide scope of the project and the strict deadline also require considerable Increasing focus on aggressive tax planning
resources from our administrative organization. More detail on this is provided Countering aggressive tax planning has been high on the agenda of politicians,
in the following section: Sound management of pension assets. the media, and society at large since the 2008 financial crisis. In recent years
in particular, this development has evolved considerably as a result of new
laws and regulations in this area. As one of the largest pension funds in the
The economy and financial markets – good year for world, it is incumbent upon ABP to help combat aggressive tax planning in
investments; inflation kicks in companies. Paying taxes is important, since they fund government investment,
education, healthcare, infrastructure, and social and economic stability. A
Taken as a whole, 2021 was an excellent year for investments. This is responsible approach to taxation enables us to contribute to a livable world
mainly the result of the excellent profit growth companies delivered in in which our participants can enjoy their pensions. On the one hand, we wish
2021. Large listed companies suffered significantly less from measures than to invest in and work with companies, governments, and managers that pursue
small entrepreneurs in the hospitality or tourism industry. The economic responsible tax policies. On the other hand, we also wish to conduct ourselves
consequences also lessened with each subsequent lockdown. Experts initially as a responsible tax payer and will support legislative initiatives aimed at
believed that the COVID-19 crisis, like other economic crises before it, would combating aggressive tax planning. Meanwhile, we will remain vigilant against
result in permanent damage. The low return on equity in emerging markets any new legislation that may be detrimental to our participants.
(approx. 5 percent) was notable. This can primarily be attributed to the strict
approach of the Chinese government towards companies in the real estate, We put this into practice by developing a new fiscal policy in 2020. In 2021,
internet, and education and training sectors. There were also interest rate we began to roll this out, taking a number of key steps. More detail on this is
increases last year, along with a number of dips as a result of growing concerns provided in the following section: Sustainable and responsible investment. (see
in relation to the coronavirus and economic growth. page 48)
COVID-19 pandemic – appreciation for our participants our efforts instead on the demand side, including large energy users and
policymakers. This keeps us actively involved in the energy transition. Ceasing
Despite large-scale vaccination efforts, the COVID-19 pandemic still had a firm our investments in fossil fuel producers also helps us meet the expectations of
grip on our world in 2021. A large share of our participants are employed in participants and employers with regard to their pension fund.
education, the police forces, or healthcare. The pandemic put great strain on
their day-to-day work. In spite of this, they carried on with enthusiasm and However, we also see concern among participants that scaling down these
dedication and deserve immense respect. Although the pandemic presented investments or divesting these assets could have a negative impact on returns.
challenges for our employees too, ABP’s operations did not suffer any ill Scientific studies and our own research indicate this is likely not to be the
effects. Our crucial projects remained unaffected. The same is true for APG, case. We address this in our communication with participants to retain their
our administrative organization. confidence in our approach and their pensions.
In the reporting year, there was a slight drop in the importance participants
Climate – accelerating measures to combat global warming attach to sustainable and responsible investment, from 65 percent to 60
percent. This is similar to the fluctuation that occurred in 2019 and 2020.
More regions are facing changes, and climate change is intensifying and Questions and comments we receive from participants signal concern that
accelerating. This became clear in the reporting year, including from the report investing sustainably and responsibly generally comes at the expense of the
by IPCC Working Group I. The Climate Change Conference in Glasgow resulted return. We hear these concerns. That is why we commissioned comprehensive
in new global agreements, including on: scientific studies in this area, for example in 2019. The outcomes of these
• phasing down the use of coal; studies strengthen our belief that we will be able to invest sustainably and
• increasing climate financing; responsibly without any compromise in terms of the risks and returns. In other
• halting and reversing deforestation by 2030; words, we expect returns to be at least equal to the return we would achieve if
• reducing methane emissions. we did not invest sustainably and responsibly. More detail on this is provided in
the following section: Sustainable and responsible investment. (see page 40)
Despite the fact that the summit concluded in a new Climate Pact, a common
criticism was that the agreements were not ambitious enough.
During the reporting year, ABP observed that we truly need to move faster if
we are to slow the rate at which our planet is warming. We have committed
ourselves to this objective, including via the IMVB covenant. To generate this
additional momentum, we launched a project together with APG that aims
to tighten up our Sustainable and Responsible Investment policy. In 2021,
we also decided to sell our investments in fossil fuel producers and focus
The value of pensions

Fossielvrij is building a civil movement to
break the power of the fossil fuel industry. “By
ceasing to invest in fossil fuel producers, ABP
is sending a strong signal,” comments Liset
Meddens, founder of Fossielvrij NL.
“In 2013, we launched campaigns in the Netherlands that focused

on financial institutions and pension funds, asking them to stop
investing in oil, coal, and gas. At that time, we sent our first letter
to ABP. Our door has been open for a dialog ever since. But it was
only when a large number of participants, such as civil servants,
teachers, and professors, issued a call to go fossil-free that we
were truly listened to. In 2021, the Board of Trustees decided to
divest from fossil fuel producers. This is a fantastic success! It
also sends a strong message to the international pension sector,
sidelining an industry we believe should be consigned to the past.
Conversely, pensions are very much about the future.
A pension is... a contribution to solutions for
societal challenges
The ability of pensions to bring about change is underrated.
Funds manage huge pools of money belonging to participants.
‘The value of This money could be put to good use in tackling societal
challenges such as insulating all Dutch homes. Participants also
pensions is hold much greater sway than they typically assume. They should
not underestimate their power and should use it to have their say
underrated’ about how their money is used. The decision by the ABP Board of
Trustees only goes to prove the impact participants can have.”
Liset Meddens
Founder of Fossielvrij NL
Contents Strategy and progress ABP Annual Report 2021 22
How we build a good

pension together
Our strategy is aimed at building a good
pension together in a way that makes us
the preferred choice of participants and
employers. We have created a strategic
roadmap to fulfil this aim. Our roadmap
remained unchanged in the reporting
year, although we did add nuances in
response to developments in and outside
our organization.
ABP’s strategy B. Appealing fringe benefit;

C. Good pension for the future.
We adopted nine underlying sub-strategies to help us fulfill our “Building a Our solid foundations with a professional organization meet an important
good pension together” mission. These jointly form our three strategic pillars: precondition (D).
A. Good services;
Building a good pension together – participants and employers prefer ABP

Our strategic roadmap
Good Appealing Good pension

services fringe benefits for the future
1 Our pension 2 Our asset 3 Our pension 4 Our financial 5 We are committed 6 We are the
management management scheme is simple, structure has to a good pension pension experts,
(administration delivers an controllable, and an equilibrium system in the including in
and communi- optimum return in explainable. between Netherlands. pension
cation) is focused a sustainable and contribution, innovation.
on the experience responsible certainty, and
of participants and manner. ambition.
employers.
7 We have a professional 8 We have a grip on activities 9 Our internal operations

Solid foundations Board of Trustees with very outsourced to APG. are in order.
broad support.
Core issues for 2021 relation to pensions. Together with other parties in the sector, ABP will
work towards a revaluation of pensions over the coming years. Within our
We focused on the following elements of our strategy in the reporting year: own ranks, we will endeavor to build trust by administering pensions in a
• sustainable and responsible investment – results and challenges are reliable, consistent, and transparent manner.
discussed in the Sustainable and responsible investment section; (see
page 36) • Data management
• our pension services – results and challenges are discussed in the Sound Ensuring our pension records are in order has been a point of concern for
management of pension assets section; (see page 55) some time. In order to determine the appropriate payment, our system
• the new pension contract – see also the Trends and developments section; must reflect all data accurately, even when the provisioning of the data is
(see page 17) dependent on participants, employers, and other welfare agencies such as
• reinforcing our solid foundations – see also the Governance section. (see the Social Insurance Bank (SVB). There is also additional pressure from the
page 88) complexity of our pension scheme as it has developed over the years. We
put mistakes right, supplement missing data, and want all participants to
Looking back at 2021, we can conclude that good progress was achieved in receive the payments they are entitled to, based on the correct data. In the
these focus areas. We strengthened sustainable and responsible investment, years ahead, this will continue to be an important area for attention with
including by ceasing our investments in fossil fuel producers. We also worked regard to our operations and our interactions with participants.
hard to develop our services. This, at times, presented new challenges, with
concurrent service years being a case in point. The quality of our records • Support for sustainability policy
provides a key foundation, and in 2021, we introduced improvements in In 2020, as part of our investment policy, we presented a Sustainable
this regard through the Grip on Data program. The transition to a new and Responsible Investment policy for the policy period up to 2025. In
governance model will enable us to further professionalize our governance and 2021, we concluded that, with respect to some elements of this policy, we
pension fund. need to aim higher. Participants and employers, along with a number of
special interest groups, told us they expect us to do more, for example
The following are the Board of Trustees’ points of concern: in contributing to solutions for climate change. Our decision to no longer
• Pension confidence invest in fossil fuel producers is our first step towards raising our ambition,
Consumer confidence in pensions lags behind the reliable and predictable and we will take further steps in 2022. Support for this policy declined
manner in which pension administrators pay pension benefits in the slightly, although there was a small recovery in the fourth quarter of 2021.
Netherlands. One reason for this is the inability to increase accrual and We will continue to listen to participants’ and employers’ wishes and will let
payments over the past years; another is the uncertainty around the these guide us in increasing our ambitions further still.
transition to a new pension system. In addition, confidence is influenced
by public debate on upcoming changes, opposing views of the future
of pensions, and the sometimes cautionary statements of regulators in
Progress Focus for 2022
Despite intentions to do so, we did not supplement our strategic KPIs in We will tighten up our strategy in 2022. In this regard, there will be no major
2021. The primary reason for this is that we will address this in the strategic deviation from our focus in 2021. Our overall direction will continue to be
three-year plan to be developed for the 2022-2025 period. We extended the set by our roadmap. We endeavor to achieve progress in respect of all our
2021 annual plan until the middle of 2022. The current plan will more than sub-strategies. Priority will be given to the following aspects:
adequately cover that period and allow us to focus on the three-year plan. This • continuing the program focused on improving our records;
plan will then be used as the basis for a new annual plan. • tightening and accelerating our Sustainable and Responsible
Investment policy;
Progress • making preparations for the introduction of the NPC;
Results Sub-strategy1
• employees and the Board of Trustees working and collaborating in the new
rNPS participants -23 ABP organization.
rNPS employers +22
CES participants 72%
CES employers 95%
Reputation with stakeholders 6.6
Participant support 5.4
for sustainable and
responsible investment
Pension scheme Expansion of services
for participants
and employers;
improving records
New pension contract NPC program designed
and launched
Solid foundations Transition to new
governance model
1 The numbers are a reference to the strategic roadmap shown on the previous page.
Contents What is important to our stakeholders ABP Annual Report 2021 26
Important topics
for stakeholders
We regularly engaged with our stakeholders
throughout 2021. One of our questions to
them concerned the topics they feel it is
important for ABP to report on. We amended
the structure of our annual report based
on the results of a survey among 1,000
stakeholders within and outside of ABP.
This represents a further step in providing
integrated reports, which we kicked off with
the publication of our annual report 2020.
Who are our stakeholders?

We focus primarily on our participants and employers –
we put them at the center of everything we do.
ABP also has other stakeholders.
Primary ABP target groups Internal stakeholders Regulators
• Active participants, former participants, and • Accountability Body • De Nederlandsche Bank

retired persons • Supervisory Board (until 1 January 2022) • Dutch Authority for the Financial Markets
• Employers • ABP staff • European Insurance and Occupational Pension
• APG Executive Board, Management Team Authority
and staff • Netherlands Authority for Consumers & Markets
• Pension Board Including: • Political centers in The Hague

• Sectoral Consultative • Employees’ and employers’ organizations and Brussels
Committee for Defense • Special interest organizations • Media
• Government sectors • Government • Experts and science
Social • Sector employers Other • Social and Economic Council • NGOs
partners • Sector trade unions stakeholders • Labor Foundation
Research into important topics for stakeholders ABP to discuss in the annual report. A total of 27 internal and 434 external
stakeholders sent in responses. The results were weighted, which means
To identify and prioritize relevant topics, we commissioned external research that the average ratings of a large group like our participants hold equal
in the reporting year. Our strategy was used to prepare a shortlist, which weight to those of the Board of Trustees. The result is shown in the following
was then presented to selected internal and external stakeholders. We asked materiality matrix.
them to tell us which topics they considered important and less important for
ABP’s materiality matrix
ABP's interest according to external stakeholders
High
importance
Financial
performance
Equilibrium between
contributions, Indexation
certainty,
and ambition
Sound management
of pension assets Sustainable and
Social responsible
return investment
Optimal service
Pension scheme: to participants
simple, controllable,
and explainable The new Optimal Contribution to
pension return sustainable objectives
contract
Fund
vision
Transition
Freedom
to the new pension
Digital to choose Participants’
contract
Pension security within pension confidence
innovations and privacy pension
scheme
Pension
communication
Investments Choice with participants
in NL guidance Fund
governance
Pension sector
collaboration
Low on new system Pension administration
importance
Low importance High importance
ABP's interest according to internal stakeholders
The X axis indicates the topics that internal stakeholders consider important The results sections of this annual report discuss the topics appearing above
for ABP to cover in the annual report. On the Y axis, these outcomes were the line in the matrix. These are topics that both the external and internal
plotted against the topics chosen by external stakeholders. Note that this is stakeholders of ABP consider the most important to see reflected in the
not about discovering what areas would be important for ABP to target in annual report.
its strategy.
For the sake of convenience, highly material topics that share direct links have Contributing to sustainable objectives
been grouped together in the report of the Board of Trustees. This enables The extent to which ABP contributes to the achievement of goals that provide a
us to present a combined account of these topics, which are Sustainable and course for making the world a better place by 2030.
responsible investment, Contribution to sustainable development objectives,
and Equilibrium between contribution, certainty, and ambition. These material
topics therefore appear side by side in the results section, creating a slight Next steps
deviation from the order of importance indicated in the matrix. The results
sections will also address other topics from the materiality matrix as relevant. One of our next steps will be a further deepening of the material topics.
We will consider the effects of ABP’s activities on the outside world, and vice
versa, as part of this. This deepening will enable ABP to better report on the
Definitions of the most important material topics manner in which sustainability aspects influence our performance, position,
and development (the “outside-in” perspective) and on the impact of our
Financial performance performance, position, and development on people and planet (the “inside-out”
ABP’s financial position and situation, including funding ratios, increases, and perspective). This is known as double materiality
reductions (indexation).

The extent to which ABP factors in people, the environment, and good
governance when investing the contributions of participants in companies
and organizations.
Indexation
Percentage increase in pensions equal to, for example, price inflation or
wage growth.
Sound management of pension assets

Handling participants’ money responsibly, keeping adequate records, and
communicating well with participants.
Equilibrium between contribution, certainty, and ambition

Striking the right balance between contributions and risk in order to preserve
the spending power of participants after their retirement date.

When asked about the value of pensions,
Director Arjan Vliegenthart of the Dutch
National Institute for Family Finance
Information (Nibud) responded in a heartbeat,
“A pension is peace of mind. Knowing that you
will be able to do the things you envisaged
during your working life.” Nibud works closely
with pension funds to ensure people are
making the right choices.
“Nibud provides information and advice on managing money now

and in the future. This is where our close collaboration with
pension funds fits in. One of our initiatives is the five-step pension
calculator, a tool that helps people understand their income and
expenses during their retirement. One-and-a-half centuries ago,
old age was closely associated with poverty. Our pension system,
which is still among the best in the world, put an end to this
over time. On average, people in Dutch society have a comfortable
A pension is... peace of mind old age. Whereas pension funds would previously tell participants
what was best for them, participants now adopt an increasingly
‘The right critical stance and wish to have greater choice for themselves.
However, given that pensions are complex, deciding what is right
choices for can be tricky. A lot comes down to personal circumstances –

whether someone is in rented accommodation or has fully repaid
the future’ their mortgage, for example. Personal preferences and ideas also
play a role, whether that means looking after grandchildren living
three miles away or touring Europe in a camper van. A pension is
about having control over your finances and, ultimately, your life.
Arjan Vliegenthart So we can continue to enjoy life, even into old age.”
Director of Nibud
Contents Results: Financial performance ABP Annual Report 2021 31
How ABP is
doing financially
ABP can look back at a year of solid
financial results. Unfortunately, though, the
policy funding ratio was ultimately still too
low to allow for pension increases. In this
section, we provide further details regarding
the development of our financial position
in 2021.
In 2021, our financial performance showed a good upward trend. ABP Funding ratio rises
generated an annual return of 11.4 percent (2020: 6.6 percent). This is
equivalent to an amount of €56.3 billion. Equity, alternative investments These developments drove an increase in our funding ratio and are illustrated
(private equity, commodities, and hedge funds), and real estate in particular in this table.
performed well. ABP’s available assets rose from €495 billion at the end of 2020
to €552 billion in 2021. Funding ratio development in %
2021 2020
In the Sound management of pension assets section, we take a closer look at Funding ratio at previous year-end 93.5 97.8
our investments in 2021, in terms of both return and costs. Contribution vs accrual -1.2 -1.1
Change in the interest rate term structure 6.5 -11.4
In 2021 the discount rate rose from 0.2 percent to 0.6 percent. As a result of Return on investments 10.7 6.4
this 0.4 percentage point increase, the value of our pension liabilities (that is, all Interest added to the liabilities 0.5 0.3
Update of actuarial assumptions on liabilities 0.5 2.8
current and future pension payments) fell from €530 billion at the end of 2020
Other 0.1 -1.3
to €499 billion at the end of December 2021.
Funding ratio as at year-end 110.6 93.5

Discount rate development in 2021
0.8
It can clearly be seen that, at 10.7 percent, the return on investments had a
0.6
significant positive effect on the development of the funding ratio and that the
uplift in the discount rate led to an increase of 6.5 percent.
0.4
The funding ratio is an indicator of a pension fund’s ability to make current and
0.2 future pension payments. It is an expression of the relationship between the
available assets (€552 billion) and ABP’s liabilities (€499 billion). At the end of
0
2021, the current funding ratio amounted to 110.6 percent. The policy funding
31 Dec 2020 31 Mar 2021 30 Jun 2021 30 Sep 2021 31 Dec 2021 ratio – which is the average of the current funding ratios of the past 12 months
– also increased in 2021, from 87.6 percent to 102.8 percent. This funding ratio
is used to determine whether pensions could be increased. Increases require
Rising interest rates reduce the amount of capital a pension fund needs to the policy funding ratio to be at least 110 percent. ABP was below this level,
maintain in order to meet all its liabilities. Healthy returns and a decrease in and pension increases are therefore not permitted. However, the troubling
liabilities therefore translated to an improvement in our financial position.
situation that might have necessitated a reduction in pension, which very much At the end of 2021, the policy funding ratio again stood at less than the
hung over us in 2020, appears to have now passed. required level of around 126 percent. We were therefore required to submit
another recovery plan before April 1, 2022. The 2022 recovery plan indicates
Funding ratio development in 2021 we will achieve the required funding ratio within 10 years. Since the funding
120 ratio at the end of 2021 was significantly above that of the previous year, our
calculations also include the increase in pension, as per the ABP indexation
policy. Moreover, we have not applied for the exemption for pension funds this
Funding ratio
110 time. In other words, ABP is recovering under its own steam.
Minimum capital requirement (+100)

ABP also fulfilled the statutory requirement to file a feasibility test with
100 regulator DNB in respect of 2021. A feasibility test provides insight into the
relationships between the financial structure, the anticipated pension result,
and the associated risks.
90
Policy funding ratio
Outlook
80
31 Dec 2020 31 Mar 2021 30 Jun 2021 30 Sep 2021 31 Dec 2021
If central banks scale down their monetary support, for example in response
to the sharp rise in inflation, the value of our investment portfolio may fall.
At the same time, our pension liabilities would also reduce. If the value
Recovery plans of investments falls sharper than the value of the liabilities, ABP’s financial
position will weaken.
In the spring of 2021, ABP submitted a recovery plan. We were required to do
so because the policy funding ratio at the end of 2020 was below the required The world has moved on since the balance sheet date. The course of the
level of around 126 percent. Our recovery plan needs to show whether we COVID-19 pandemic continues to generate uncertainty. High inflation rates are
are able to return our policy funding ratio to the required level within the proving more stubborn than previously through, which has brought expected
prescribed recovery period. If we are unable to achieve this within that period, interest rate measures by central banks considerably closer. Equity markets
a reduction in pensions may be necessary. The 2021 recovery plan indicated made a poor start, and the Russian invasion of Ukraine has amplified concerns.
this would not be the case. We were, however, required to make use of the Energy prices have risen sharply due to (the threat of) supply issues and
available exemption, which permits us to extend the recovery period from 10 boycotts; sanction measures such as the removal from SWIFT could have
to 12 years. The recovery plan led us, the Board of Trustees, to conclude that unknown consequences; and the loss of wheat supplies from Ukraine could
there was no need to put further measures in place for 2021. significantly drive up the price of food.
A large number of investors, ABP among them, have decided to withdraw from
Russian investments, although current circumstances mean it has not yet been
possible to give effect to this in all cases. This is linked to the considerable
volatility on the current markets, which is the result of a negative supply shock
in the economy, and this in turn translates to less growth, more inflation, and
erratic movements on global stock exchanges.
In recent years, we have advocated for the option to increase pensions sooner,
and we will be glad when we are able to do so again. More information on
pension increases is provided in the section Equilibrium between contribution,
certainty, and ambition.

Anke Cornelissen is a portfolio manager
at APG. She and her team invest in
government bonds across developed markets,
including Europe, America, and Australia,
while closely monitoring market and portfolio
developments. She works for the benefit of
ABP’s participants. To her, pensions represent
personal growth and pride.
“Government bonds, the investment category I am responsible

for, are the most risk-free form of investment. My objective is
to deliver a return that, as a minimum, preserves the spending
power of ABP participants. As dull as that might sound, the day-
to-day is actually incredibly dynamic. Major events across the
globe have an immediate impact on bond markets. Economics
is not an exact science but more like an ever-changing jigsaw.
We’re always searching for answers, and there are many factors
at play. Just when you think you finally have things pinned down,
A pension is... personal motivation an event with unforeseeable consequences, like COVID-19, comes
along. Learning never stops in this profession, which also puts us
‘We know at the center of our ever-evolving economy. Unlike commercial

operators, pension funds do not need to attract customers.
who we are This leaves them more room to focus on the substance. My
investments go towards the pensions of one in four Dutch citizens.
doing it for’ That is a great motivator for me. Even though we may not see or
speak with them, we all know on whose behalf we are investing.
Our work is for the benefit of the country, and that gives me a
great sense of pride.”
Anke Cornelisse
Portfolio manager
Contents Results: Sustainable and ABP Annual Report 2021 36
responsible investment
Investing in a
livable world
ABP wishes to offer participants a good
pension, both now and in the future, that
they can enjoy in a livable world. That
is why we consider return, risk, costs,
and sustainability performance with every
investment decision we make. ABP adopted
this approach in 2015 and set new targets for
2025 in 2020. In 2021, we decided to further
tighten our policy in order to give further
momentum to the fulfillment of our goals.
Contents Results: Sustainable and responsible investment ABP Annual Report 2021 37
Sustainable and responsible investments 2021

Focus on 3 transitions ABP is the most sustainable Dutch Performance in 2021 and goals for 2025
pension fund (VBDO)
Climate change and the transition For the fourth year in a row % of assets invested in SDGs 18.1%
to sustainable energy sources 2020 16.4%
Goal for 2025 20%
Conservation of natural resources Top 3 SDG investments
Invested in SDG 7
Affordable and sustainable energy
Digitalization of society 14% €18.5 billion
2020 €13.8 billion
Goal for 2025 €15 billion
19% 43%
Inclusion and exclusion CO2 footprint of equities portfolio

compared with 2015 -48%
Inclusion policy 24% 2020 -40%
Focus on leaders Goal for 2025 -40%
Leaders 85%
Exclusion policy
Investments in green,
No investments in: Precondition
social, and sustainable
• Weapons prohibited by international Respect for human rights
bonds €14.9 billion
agreements
2020 €10.2 billion
• Nuclear weapons
• Tobacco manufacturers ABP complies with the:
• Government bonds of countries under • IMVB covenant
a UN or EU binding arms embargo • SFDR regulation
• OECD guidelines
As ABP invests with a long-term sustainability vision, our Sustainable and

Responsible Investment policy sets out our vision for 2050 and our ambitions
for 2030 based on this vision. The policy also outlines our sustainability goals
for 2025 and how we intend to achieve them. To accelerate the realization of Digitalization of society
our objectives, we launched a project together with APG in 2021 that aims to
tighten up our Sustainable and Responsible Investment policy. Fast and energy-efficient internet access
In 2021, ABP and telecoms operator KPN invested in the
Focus on three transitions accelerated installation of fiber broadband in almost 1,000 villages
Our Sustainable and Responsible Investment policy for the coming years aims and small communities, covering around 1,1 million connections
to address three major societal changes (transitions). in villages such as Ankeveen and Grou. This investment amounts
to over €1 billion. Safe, reliable and fast internet is of major
Climate change and the transition to sustainable energy sources importance to the Netherlands, particularly now that so many are
ABP has used the insights of the UN panel on climate change (the IPCC) to working from home. Fiber optic is faster and much more energy
inform its climate policy since 2015. The IPCC report published in 2021 is efficient than copper or regular cable. This collaboration brings
another clear indicator that strong reductions in greenhouse gas emissions fiber broadband at an accelerated pace to communities around
are needed and that the global economy must shift to renewable energy. ABP the country that currently lack access.
wants its investments to contribute to this. More detail on this is provided
in the “Climate change and the transition to sustainable energy sources”
subsection. (see page 43)
Conservation of natural resources

Demand far outstrips the available natural resources on our planet. To avoid
depletion and loss of biodiversity, it is important to curb wastage and promote
reuse. ABP is committed to investing in solutions and preventing loss of
biodiversity. More detail on this is provided in the “Conservation of natural
resources” subsection. (see page 46)
Digitalization of society
Our vision for 2050 is that companies make responsible use of digitalization
as a solution for sustainability problems. We wish to increase investments in
Learn more about this topic
companies that contribute towards digital, sustainable solutions. We also want

Investments by SDG 15. Life on land
companies to respect the digital rights of employees and consumers, including €1.3 miljard
their right to privacy and their freedom of expression. 14. Life below water 1. No poverty
€215 million €755 million
13. Climate action 2. Zero hunger
€361 million €2.0 billion
Important preconditions
We consider respect for human rights by the companies in which we invest to
12. Responsible consumption 3. Good health
be a precondition for fair progress in these three transitions. We also consider and production and well-being
€1.7 billion €24.0 billion
good corporate governance to be an important condition that companies need
Total 4. Quality education
to meet to successfully accommodate the transitions. €99,3 billion
€714 million
11. Sustainable cities and
communities 6. Clean water
€42.8 billion and sanitation
Contribution to the Sustainable Development Goals €1.3 billion
The three transitions tie in with almost all the Sustainable Development 10. Reduce 7. Affordable and
inequality sustainable energy
Goals (SDGs) that were adopted by the United Nations in 2015 with the €244 million €18.5 billion
8. Decent work and

intention of building a better and sustainable world, and which include 9. Industry, innovation economic growth
and infrastructure €1.0 billion
affordable and sustainable energy, sustainable cities and communities, and €4.5 billion
accessible healthcare.
APG is a co-initiator of the SDI Asset Owner Platform (SDI AOP). Created in
We refer to our investments in these goals as Sustainable Development 2020, this platform uses groundbreaking technology to assess companies in
Investments (SDIs). We have adopted the same return, cost, and risk terms of their contribution to the Sustainable Development Goals. The lack
requirements for these investments as for our other investments. One example of reliable information complicated – and sometimes still complicates – the
of an SDI is our investment in Dutch organization Arcadis, whose mission is to determination of the contribution that companies make to the Sustainable
improve our living environment by offering government bodies and companies Development Goals. This information is now available from the platform.
support in the field of water, environment, infrastructure, and buildings.
Another example is Salvia Bio Electronics, a Dutch start-up developing a The platform enables major investors to a make a specific contribution to
solution for chronic headaches. the Sustainable Development Goals, speak to companies with one voice, and
improve their reports.
Our goal for 2025 is to have 20 percent of our total investments classified as
SDIs. As of the end of 2021, 18.1 percent of our assets made a quantifiable The standard will be expanded (for example, by the inclusion of new
contribution to the Sustainable Development Goals. Publication of these companies and investment categories) and refined (for example, by including
metrics is one quarter in arrears for investments in private markets (such as patents in the classification) in the coming years. Information on the method
private equity and direct investments in real estate) and two quarters in arrears we use to classify investments as SDIs is available on the APG website.
for hedge funds.
Inclusion of investments
ABP assesses all companies in which investments can be made in the form of
equities or bonds (the investable universe) in terms of risk, return, cost, and
the extent to which their operations are sustainable and responsible. We refer
What are the implications of sustainable and responsible
to companies that meet our corporate sustainability and responsibility criteria
investment for the return?
as “leaders”.
We expect that sustainable and responsible investment will yield
a return at least equal to investments that do not meet these
At the opposite end of the spectrum are “laggards”, companies that do not
criteria. This is substantiated by scientific research.
score well on corporate sustainability and responsibility. ABP can invest in
these companies, but only when we expect we can encourage them to exhibit
ABP measures how the return on equities and bonds is influenced
more sustainable and responsible behavior. The risk and return, or expected
by inclusions and exclusions, reduction of the CO2 footprint, and
return, from the company will then need to be sufficiently appealing to invest
investments in Sustainable Development Goals. This effect is
the time and effort in an improvement process. A company for which this time
slightly favorable over 2021.
and effort is worthwhile is referred to as a “potential improver”. ABP clearly sets
out which improvements are required and the time within which these must be
In 2022, we will also measure the impact of sustainable
completed. We will dispose of our investment when a company fails to make
and responsible investment on bonds of emerging markets,
sufficient improvement.
listed real estate, labeled bonds, and various categories of
alternative investments.
Our inclusion policy ties in with national and international legislation and
regulations. The policy complies with the OECD guidelines, including the
Our expectation is that our withdrawal from investments in fossil
structural assessment of ESG risks in the portfolio and influencing companies
fuel producers will not have a negative effect on the long-term
to mitigate those risks. We expect companies in which we invest to also
return and that pensions will therefore also remain unaffected.
conform to the UN Global Compact on human and labor rights, the
Research into the long-term return of these investments shows
environment, and anti-corruption principles.
there would have been no negative impact if ABP had not
invested in these companies. It is also clear that these companies
In view of the gap between our results and our ambitions, we will subject
increasingly come up against climate risks, which brings financial
this part of our policy to a critical review when tightening our Sustainable and
risks for them.
Responsible Investment policy. We may introduce changes in 2022 in order to
enhance our impact.
Our objective is – and continues to be – to ensure a good pension
for our participants, and we want them to be able to enjoy
that pension in a livable world. Our Sustainable and Responsible
Investment policy contributes to both of these goals.
How do we approach this? Leaders, laggards, and potential improvers within the ABP portfolio1
(% of number of companies)
We determine whether a company is a leader or laggard using specific criteria
that vary depending on the business sector and region. We also check whether 10% 7%
2%
a company has been involved in incidents, such as workplace incidents or 2% 5%
3%
damage to the habitat of local communities, as this also influences our
company assessments.
Our investments in private markets, such as real estate, infrastructure, private

2021 2020
equity, and hedge funds, are also assessed for sustainability. We impose
people and planet requirements when we make an investment.
Exclusion of investments
85% 86%
ABP does not invest in companies or government bonds of certain countries.
These appear in our exclusion list. ABP does not invest in companies involved
Leaders Potential improvers Laggards Insufficient data to
classify
ABP named the most sustainable Dutch pension fund for the 1 There is not always sufficient data available to assess a company. This is because, in
fourth year in a row any given year, there are new arrivals and “leavers” among the companies in which
In 2021, ABP once again came top of the list of sustainable investments can be made in the form of equities or bonds. 2021 saw an increase in the
number of companies for which we lack data. ABP carries out its own research in order to
Dutch pension funds. The Association of Investors for Sustainable
classify these companies as a leader, laggard, or potential improver.
Development (VBDO) carries out an annual study to assess the
sustainable and responsible investment policies and performance
in the manufacture of weapons prohibited by international treaties (Cluster
of the fifty largest pension funds in the Netherlands. These funds
munitions, anti-personnel land mines and chemical and biological weapons) to
jointly manage €1,540 billion, which represents close to 90 percent
which the Netherlands is a signatory.
of Dutch pension assets. This is the 4th year in a row that ABP ranks
number one. However, a tightening of the VBDO requirements
Neither does ABP invest in tobacco companies or companies involved in the
meant our score was lower than in the previous year. The main
production of nuclear weapons or important components of nuclear weapons,
objective of VBDO is to gain greater insight into contributions
nor in government bonds of countries on which the UN Security Council has
towards sustainability, and we aim to provide this.
imposed a binding arms embargo.
Green, social and sustainable bonds Banks and ABP enhance growth potential of affected
Some of ABP's SDIs are bonds labeled as sustainable bonds issued by Dutch companies
companies, public authorities, and institutions to fund green or social projects, In June 2021, ABP joined together with three large banks – ABN
or a combination thereof (sustainable projects), such as projects for the use AMRO, ING, and Rabobank – to make available €400 million in
of renewable energy or the construction of affordable housing for vulnerable loans for Dutch companies that are keen to invest again after the
groups. The return and risk of these bonds are at least comparable to those of pandemic but find themselves hampered by a diminished equity
bonds that are not for a social or sustainable purpose. We held investments of position. These are large and medium-sized companies that are
€14.9 billion in bonds labeled as sustainable at year-end 2021 (up 45 percent healthy at their core.
from 2020).
Through this initiative, the participating banks, ABP, the
Netherlands Bankers’ Association, and the Confederation of
ABP investments in green, social, and sustainable bonds
Netherlands Industry and Employers (VNO-NCW) wish to drive a
Sustainable
61 bonds
recovery in investment by Dutch companies and thus promote
€1.29 billion economic growth in the Netherlands. The initiative will allow
Total 2016
59 bonds companies that operate in key sectors for our economy and
€1.4 billion
employment to resume investment. The collaboration generates
Total 2017
102 bonds an attractive return and contributes towards a good pension for
€3.5 billion
our participants.
Social Total 2021 Total 2018
61 bonds
€1.91 billion 334 bonds 141 bonds
Total 2019
207 bonds
€7.6 billion
Green Total 2020

212 bonds 264 bonds
The issue of bonds labeled as sustainable has been on the increase for a
number of years now. ABP is one of the largest global investors in bonds of
this nature and works to promote healthy growth in this market, for example
by communicating to companies what requirements we set with regard to
sustainable bonds and entering into dialogs about the possibilities that exist.
The offer is becoming increasingly diverse in terms of issuer (company size
and sector) and the type of bond (green, social, or sustainable). The strongest • The CO2 footprint of our equities investments will be reduced by 40 percent
increase in 2021 was in the issue of sustainability-linked bonds. This relatively as compared with 2015.
new category offers additional interest in the event that pre-determined • We will invest €15 billion in Affordable and Clean Energy (SDG 7) of the
sustainable goals are not met. Sustainable Development Goals.
• We will set stricter supplementary standards for more precise assessments
Our investments in 2021 included €160 million in the first green bond launched of company climate efforts pursuant to our inclusion policy.
by the European Union (EU) as part of a large-scale European recovery plan
aimed at reinforcing and greening Member State economies. Divesting from fossil fuel producers
2021 revealed to us that making a compelling contribution to key transitions,
Climate change and the transition to sustainable energy sources such as in the area of energy, required us to increase the ambition of
Climate change impacts the future of our participants and employers and has our policy. One of our objectives was to introduce stricter requirements for
consequences for our investments. We want the companies in which we invest assessing corporate sustainability efforts. We began work on tightening our
to reduce their CO2 emissions and to have a strategy in place for the transition policy and the execution of this policy.
to a climate-neutral economy. We are also selling our stakes in producers of
fossil fuels like oil, coal, and gas. ABP announced in October that it would withdraw from its investments in
producers of fossil fuels (coal, oil, and gas). Recent reports by the International
ABP's vision for 2050 Energy Agency and the UN Intergovernmental Panel on Climate Change (IPCC)
• The global economy is climate neutral. had revealed that people around the globe were already experiencing the
• Global warming has been limited to 1.5 C 0
physical consequences of climate change. Only more robust actions could
• Energy is affordable for everyone. prevent global warming from reaching unacceptable levels. Rapid and large-
• Our investment portfolio has net zero CO2 emissions. scale reductions in CO2 emissions would be needed to combat this. Broad
groups of participants and employers had expressed the importance of
Climate change and our investment policy these issues to them by sending letters to the Board of Trustees, organizing
The signatories to the Paris Climate Agreement (2015) agreed to keep global demonstrations outside the ABP offices in Amsterdam and Heerlen, and setting
warming below 2 degrees Celsius in the period up to 2050 and to pursue up various actions on social media.
efforts to limit global warming to 1.5 degrees Celsius. This goal has been
set out in the Dutch Klimaatakkoord (Climate Agreement). ABP has signed The relevant invested assets amount to well over €15 billion, close to 3 percent
the Commitment of the Dutch Financial Sector to the Paris agreements and of all the pension assets invested. The sale of these investments will take
the Dutch Klimaatakkoord. We wish to achieve the more ambitious target place in stages, and the majority is expected to have been sold by the first
of limiting global warming to 1.5 degrees Celsius. In line with this, the CO2 quarter of 2023. We will increase our share in renewable energy and our
footprint of our investment policy must be reduced to net zero emissions by involvement with smart solutions for the energy transition wherever possible,
2050. ABP has set out specific and quantifiable climate goals for 2025: whilst continuing to apply our usual return, cost, and risk requirements. Our
divestments are expected to remain without any negative impact on long-term

returns and pensions.
ABP’s main objective will be to urge major consumers of fossil fuels – like
electricity suppliers and the automotive and aviation industry– to shift to clean
energy at an accelerated pace. This means our efforts will focus on companies Climate change and the transition to sustainable
that use fossil fuels (the demand side) rather than the companies producing energy sources
those fuels (the supply side). We expect this will enable us to deliver better
results. In addition, we will continue to advocate with government bodies for an Smart use of residual heat
extension of the use of carbon pricing in industry. We will also keep pushing for Why not capture the heat produced in data centers and use it
the removal of subsidies for fossil-based activities. to heat homes, offices, and hotels? This is the thinking behind
a collaboration between an organization in which ABP invests,
In 2021, ABP already divested from companies that derive more than 30 Energie voor Elkaar, and an existing data center located near
percent of their turnover from coal mines or more than 20 percent from tar Schiphol Airport. The residual heat used is sustainable in origin,
sand. Examples include Suncor Energy (tar sand) and Whitehaven Coal. Coal as the data center runs on 100 percent renewable energy. In the
burning and the production of oil from tar sand generates high CO2 emissions, long term, the connected buildings will reduce CO2 emissions by
even in comparison with other fossil fuel. 4,200 tons per year, which is equivalent to the annual emissions
from electricity use by 2,800 Dutch households.
By 2030, ABP will have moved away from any direct investments in coal-
fired power stations in OECD countries that are not fitted with CO2 capture
technologies (for the capture and storage, or reuse, of greenhouse gases). We
will significantly scale back these investments in other countries.
Fair transition
We and other major investors urge companies to accelerate the energy
transition. We aim for a fair transition, so that energy remains accessible and
affordable for everyone. Companies engaged in the extraction of minerals of
importance to the energy transition (such as cobalt) must tackle malpractice
in the operations. We also expect companies in sectors in which the energy
transition will result in a loss of jobs to invest in the employability of
their personnel.

One of our focus areas for 2021 was the automotive sector. Climate Reduction in CO2 footprint of portfolio since March 31, 20151
(Target: -40%)
considerations are leading auto manufacturers to increase their production of
electric cars. Although this is a positive development, a concern to us is the 0
major impact of electric driving, digitalization, and automation on the millions
of people employed in this sector. We urge auto manufacturers to invest in the
employability of their workers and offer training programs. In addition, we ask -25
-28% -28%
that they address the erosion of labor and human rights in their supply chains.
-37%
-40%
-50
Mapping climate risks, investing in solutions -48%
APG maps the risks of climate change accompanying investments for ABP.
These are mapped with the framework developed by the Task Force on -75
Climate-related Financial Disclosures (TCFD). We also implement measures to 2017 2018 2019 2020 2021
control climate risks in the investment portfolio.
We also invest in solutions for climate risks. Our investments in, for 1 The CO2 footprint of equities investments is calculated using the equities portfolio as at
example, sustainable bonds issued by developing countries contribute to the March 31 following the reporting year.
construction of climate-resilient infrastructure in these countries. ABP and two

other major investors announced in 2021 that they had acquired a Chilean goal in 2022. Information about the method we use to determine the CO2
production forest with an area of 80,000 hectares. Forests capture a great footprint is available here.
deal of CO2 from the air. The forest, which is approximately 15 times the size
of the De Hoge Veluwe national park, holds FSC certification and is therefore ABP also publishes the CO2 footprint of the investments in corporate bonds,
managed in a way that is sustainable, preserves biodiversity, and takes account private equity, and real estate. This ties in with the agreements set out
of the interests of employees and the local community. in the Commitment of the Dutch Financial Sector. We, in line with other
Dutch financial institutions, use the standard of the Partnership for Carbon
Less CO2 Accounting Financials (PCAF) for this purpose. We will link climate goals for
Our asset manager calculates ABP's share of CO2 emissions by companies in 2030 to this in 2022.
which we hold equities investments. This CO2 footprint has fallen by 48 percent
since March 2015 (2020: -40 percent). This means we comfortably achieved our Investing in affordable and sustainable energy
target for 2025 (-40 percent). This is partly due to the tightening of our inclusion ABP intends to have €15 billion invested in Sustainable Development Goal
policy, which led us to sell a number of investments in carbon-intensive 7, “Affordable and sustainable energy”, by 2025. By year-end 2021, our
companies. We also focus on companies with relatively low CO2 emissions investments totaled €18.5 billion. One of these investments is Stockholm Esergi
compared with other companies in their sector. We will publish a tightened (SE), Sweden’s largest provider of district heating. In 2021, ABP furthermore
acquired a 25 percent stake in Windpark Krammer in the Dutch province of Biodiversity Accounting Financials (PBAF), and the Taskforce on Nature-related
Zeeland. This park will deliver around 4 million tons in CO2 savings during Financial Disclosures (TNFD) Forum. Together with PBAF and other parties,
its life. ABP conducted research into the main causes of biodiversity loss driven
by listed companies. We have begun to develop biodiversity requirements
Conservation of natural resources for our investments and have outlined plans for thematic engagement on
ABP wishes to increase its investments in companies providing smart solutions sustainable food.
to food and resource scarcity. Our fact sheet lists examples of this type
of attractive circular investments. Another of our aims is to double our Human rights and working conditions
investments in real estate with a sustainability certificate. A livable world respects and protects human rights. This is a key principle at
ABP, and we therefore want companies we invest in to respect the human
Biodiversity and the conservation of natural resources are two closely related rights of employees, local communities, and other stakeholders. This is also
topics. APG represents ABP in a range of alliances in this area, including the crucial for our investments. After all, companies that show due care for
working group on biodiversity at De Nederlandsche Bank, the Partnership for human rights are less exposed to the risk of reputational damage, delays, legal
proceedings, and fines. The United Nations Guiding Principles on Business and
Human Rights (UNGP) serve as our guideline in this area.
Climate change and the transition to sustainable

We assess the potential human rights risks of each and every investment We
energy sources
will use our influence as an investor to raise awareness of these risks within
companies and, where necessary, encourage them to avoid or address any
Korean chemicals giant goes green
involvement with human rights violations.
SK Innovation, a South Korean petrochemical company,
announced in 2021 that it will achieve carbon neutrality by 2050
APG is among the initiators of the Corporate Human Rights Benchmark (CHRB),
at the latest. A noteworthy fact is that their objective covers
which compares the human rights performance of companies operating
both emissions from their own operations and emissions from SK
in high-risk industries. The CHRB is a key source of information on both
Innovation’s products. The latter are known as Scope 3 emissions.
companies we invest in and candidates for investment. In addition to this,
It is true for oil and petrochemical companies in particular that the
the benchmark provides information that enables us to start human rights
majority of CO2 emissions are generated during the use of their
conversations with companies. In 2021, we raised the topic of human rights
products. Our administrator held discussions with SK Innovation
with 67 companies. We also engaged 70 companies in a dialog about labor
on behalf of Climate Action 100+. The company plans to deliver on
standards, including workplace safety and the right of workers to organize.
its goal by reducing the CO2 emissions of products and processes,
fully recycling plastic, and progressing the development of its
In 2021, ABP and 8 other major investors spoke with 50 multinationals
business unit that focuses on the production of batteries, including
about the impact of the COVID-19 pandemic on their workers. The topics we
for electric cars.
raised with them included paid leave, investing in education and training, and with successful initiatives. ABP will continue these dialogs with a number of
workplace diversity. We also encouraged companies to share their experiences businesses in 2022.
ABP has now been engaged in an improvement process at Amazon for some
time. This online retailer has higher absenteeism due to illness and accidents
compared to its peers. One of our specialists visited the company in 2021 and
Human rights in Myanmar also spoke with the management team on that occasion. Amazon has put in
ABP raised the issue of human rights in Myanmar with companies place measures to enhance workplace safety. However, we remain critical of
we invest in long before February’s coup in the country. ABP the limited amount of information the company provides with regard to the
invests in a number of multinationals operating in Myanmar that effectiveness of those measures.
may have commercial or financial links with the military. We
asked these enterprises to reconsider their position in the country. IMVB covenant
Sustained pressure from ABP and other major investors has The Dutch pension sector, government, trade unions, and societal
prompted Posco C&C, a South Korean steelmaker, to announce organizations participating in the Internationaal Maatschappelijk Verantwoord
it would end its collaboration with a company controlled by the Beleggen (IMVB, international socially responsible investment) covenant have
military. Prior to this, Japanese beer brewer Kirin had already set out agreements on preventing abuses at companies in which the sector
announced that it was terminating two joint ventures with possible invests. Pension funds must have all agreements implemented by mid-2022.
links to the military. The covenant is based on the rules for multinational enterprises adopted
by the Organization for Economic Cooperation and Development (OECD) and
the UNGP.
In 2021, ABP gave further shape to the commitments set out in the IMVB
covenant and the European Sustainable Finance Disclosure Regulation (SFDR).
ABP is an active participant in improvement processes under the “deep track”
of the IMVB covenant. These relate to a technology enterprise, a mining
company, and an operator in the platform economy. Please visit our werbsite
for more information.
Using influence as a lever

As a major investor, ABP can influence decisions made by the companies in
which we invest. We consider it important to exercise this influence to improve
their financial results, but also to urge them to grow into more sustainable and
socially responsible enterprises. Our investors therefore engage in dialogs with Fiscal policy
these companies and take the information they receive into account in their In 2021, we began to implement the new fiscal policy that we developed in
investment decisions. The overview on our website summarizes the companies 2020. This focuses on three areas:
we engaged in improvement dialogs in 2021 and the topics addressed in 1. Investment procedures;
those dialogs. 2. International collaboration and awareness;
3. Engaging with policymakers and legislators.
Voting at shareholders meetings
We will also exercise our voting rights at shareholder meetings. Key topics for We delivered progress in all three areas in 2021.
ABP are sustainability and the appointment and remuneration of executives.
Investment procedures
ABP believes that bonuses must be in proportion to performance. As a APG began to embed our fiscal policy and our principles in the four pillars of
result of COVID-19, focus on remuneration was higher than ever this year, our investment policy – risk, return, costs, and sustainability. We have set out
with some businesses generating high profits due to the virus. Examples how we can assess fiscal aspects as part of existing investment procedures.
include supermarkets, online retailers, and parcel delivery companies, who We also gather additional information on corporate approaches to taxation,
benefited from the (temporary) closure of bars, restaurants, and even shops. reporting, effective tax rates, and tax issues. One of the ways in which we use
In those cases, we do not believe it is right for management teams to receive this information is to determine which companies we will engage in a dialog on
exceptionally high bonuses. If executives did not contribute to the improved fiscally responsible behavior.
results or their performance cannot be deemed exceptional, we will vote
against what is known as the remuneration report. International collaboration and awareness
ABP organized information sessions with large enterprises in our investment
Another focus area is diversity in boards of trustees of the companies we portfolio and external managers with whom ABP and APG collaborate.
invest in. In our opinion, it is important for boards of trustees to have the We also set up international collaboration platforms with other major
right capabilities. An executive who is appointed to lead IT modernization investors. Our aim here is to be able to take joint action with regard to
should have a background in IT. We are also eager to see boards of trustees tax regulatory initiatives and large multinationals. In November 2021, we
represent a cross-section of society. Men and women, young and old, varied organized an international seminar on the subject of fiscally responsible
cultural backgrounds – research has shown that diversity in boards of trustees behavior and transparency, with the aim of raising awareness and building
translates to better decision-making. We work to bring this about by voting in greater support. Our speakers included representatives from the OECD and the
favor of or against candidates. European Commission.
We regularly post information on our website about how we vote at

shareholders meetings and why. We disclose how we voted after each meeting.
Engaging with policymakers and legislators Agenda for 2022

We stepped up our contacts with specialists at the European Commission We will continue to tighten our policy, also raising its ambitions and
and the OECD to make the voices of pension funds heard and prevent new sharpening its focus. As one of the world’s largest pension funds, ABP holds
regulations from having a detrimental impact on our participants. In this way, a relatively strong influential position. However, it is not feasible to leverage our
the joint efforts of ABP, APG, and other major investors have ensured that the investments and engagement efforts to tackle all challenges. Making choices
new OECD rules on setting a minimum corporate tax rate will not negatively is inevitable.
impact on pension funds.
We will also make the impact of our decisions on our participants even
clearer. Surveys among participants have revealed concerns that sustainable
and responsible investment comes at the expense of returns and therefore
the value of pensions. Scientific research and our own studies have shown this
not to be true, but this has not reassured all participants. By communicating
clearly, we want to inspire confidence in our participants that their pensions
are in good hands with us.
New fiscal policy:

• Investment processes
• International collaboration and
awareness.
• Engaging with policymakers and
legislators.

Former child psychologist Alex Ghys leads
group tours in the Gallo-Roman Museum in
the Belgian city of Tongeren and is a city guide
in Hasselt. It was his work that led Alex, a
Belgian born and raised, to step across the
border to the Netherlands at the time. He
took retirement at age 61 and is now enjoying
life on his own terms to the full.
Alex Ghys was employed as a child and youth psychologist at

MUMC+ in Maastricht for around 25 years. His great passion for
history and reading had already prompted him to train as a tourist
guide before he retired. “My plan initially was to continue until
age 63, but developments, automation in particular, meant the
workplace was changing fast. This made me want to retire sooner,
and luckily I was able to do so. This gave me more time for my
work as a museum guide. Some weeks, I’ll lead two tours; other
weeks, I’ll do five, mostly for children. I try to make the stories
A pension is... freedom come alive for them. But that’s not all. I organize two public events
a year in Hasselt on behalf of heritage organization Erfgoedkring
‘Plenty of Herkenrode Kuringen; I am on a writing course led by Belgian

author Kristien Hemmerechts; and I offer guided tours around
time to take Hasselt. I love the Japanese gardens there.”
up bridge’ “The value of a pension to me is that it allows me to share my

knowledge of the past with younger generations. This keeps my
creativity ticking and my involvement with the community alive. I
am keen to continue my work as a guide for a while yet. There’s
Alex Ghys still plenty of time left to take up bridge.”
Retired employee
Contents Results: Equilibrium between contribution, ABP Annual Report 2021 51
certainty, and ambition
Equilibrium in our
financial structure
Our financial structure has an equilibrium
between contribution, certainty, and
ambition. This section outlines our approach
in relation to the financial structure of the
fund during the reporting year. The main
issue was that, although we avoided the
need to apply reductions, we were not able
to increase participants’ pensions either.
Contents Results: Equilibrium between contribution, certainty, and ambition ABP Annual Report 2021 52
The financial structure of the fund is central to this material topic. It is the Gradual progression of contributions
responsibility of the Board of Trustees to create and maintain an equilibrium
between the level of the contributions, the degree of certainty (i.e., the risk of The pension scheme is adopted by social partners (and was not amended in
investing), and the ambition of the fund (i.e., annual pension increases). The 2021), whereas the setting of the contributions falls to the Board of Trustees.
Board always reviews these aspects in conjunction with each other. Based on in-house analysis and at the request of social partners, we chose a
ABP conducts an Asset & Liability Management (ALM) study every third year, contribution level that will keep 2022 contributions largely on a par with 2021.
the aim of which is to define the financial structure of the fund. This three-
yearly study was conducted in 2021 once again, with the current pension As 2023 marks the end of the conditional pension scheme (VPL scheme), this
scheme as a fixed parameter, as social partners had signaled to ABP they did formed an important area for attention in the setting of the 2022 contributions.
not wish to amend the pension scheme in 2021. The ALM study led us to define A decision to stick with the regular policy would result in a highly volatile
the financial structure as follows: pattern for the total contributions over the years to come. The aim of social
• discount rate: 2.2 percent for 2022 contributions and 2.0 percent as of partners was to avoid such fluctuations. This is why, in agreement with social
2023. This is confirmation of the decision taken in 2020 regarding the partners and following consultation with the Accountability Body, we opted
contributions trajectory. for a gradual progression of contributions, based on a balanced weighing
• The strategic investment framework: of interests.
• marketable securities and fixed-income investments make up 60 percent
and 40 percent respectively in the strategic asset mix (no change); Composition of contributions
Damped, Undamped,
• the interest risk is hedged at 30 percent to 50 percent (previously: 25
cost-covering cost-covering
percent to 50 percent). The Board feels it is important to put in place a Actual contributions contributions
robust arrangement here. Relatively small changes in the interest rate or
expected rates should not result in adjustments in the hedging. It is also a. portion for vested liabilities 7,018 7,018 19,870
important to avoid any rapid up and down movements in the hedging, b. pension administration
and consideration must be given to what is effective and feasible. cost markup 116 116 116
Finally, hedging of the interest risk must be in line with the direction or c. solvency margin markup 1,810 1,810 5,126
d. portion for contingent
anticipated direction of the new pension contract. The Board of Trustees
liabilities (indexation) 2,558 2,558 -
considered that hedging at a minimum of 30 percent is appropriate and
e. markups/markdowns on the
has set this as the lower limit; damped, cost-covering contributions 342 - -
• the inflation risk is not explicitly hedged (no change).
Total amount of
contributions 2021 11,844 11,502 25,112
A verification led us to conclude that this new financial structure is consistent
Total amount of
with our short and long-term risk appetite. We will repeat this verification contributions 2020 10,843 8,190 20,975
in 2022.
Contributions The Pensions Act stipulates that the actual contribution, the moderated cost-
as a percentage of pensionable salary (salary less
covering contribution, and the unmoderated cost-covering contribution must
contribution threshold) 2022 2021
be quantified in euros. Calculation of the unmoderated contribution is based
Contribution rate for retirement and surviving on the interest rate term structure determined by DNB. The moderated
dependents' pensions 24.4 24.4
contribution is calculated based on an expected real investment return (2.4
Contribution supplement on the contribution rate for
percent for 2021).
retirement and surviving dependents' pensions 1.5 1.5
Contribution rate for retirement and surviving
dependents' pensions, including supplements 25.9 25.9 When setting the contribution for 2023 and beyond, we come up against a
- payable by employers 18.0 17.97 number of uncertain factors, including developments in life expectancy and
- payable by employees 7.9 7.93 the composition of our membership. Insights into contribution developments
contrary to the current expectations of the Board of Trustees will be shared
Sector-based contribution for incapacity pension with employers and the Accountability Body.
(average) (1)1 0.6 0.7
- average payable by employers 0.4 0.5
ABP updated the actuarial assumptions for the contribution in 2021. During
- average payable by employees 0.2 0.2
this exercise, which takes places every three years, account was taken of
- Subtotal expressed as contribution base (average) 26.5 26.6
the death rates for the years 2017, 2018, and 2019 – the period before the
- Subtotal expressed as a percentage of salary (average) 19.6 19.9
COVID-19 pandemic struck. The Royal Dutch Actuarial Association will publish
new tables in the course of 2022 that take the pandemic into account. We will
Purchase of conditional retirement and surviving
dependents' pension rights 3.0 3.0 follow this up with an update of our actuarial assumptions study.
- payable by employers 3.0 3.0
- payable by employees - - Contribution coverage ratio development
- Total as percentage of salary (average) 22.6 22.9 The contribution coverage ratio stood at 66 percent at the outset of 2021 and
fell to 59 percent over the course of the year. The contribution coverage ratio is
The state pension offsets for the years in question an expression of the relationship between the contribution paid in a year and
amount to (in €): the value of the pension rights accrued in the same year, which translates to an
for group and individual schemes 14,850 14,550 increase in the provision for pension liabilities. The contribution paid is based
for sector-specific schemes 22,350 21,800
on a real return of 2.4 percent. The accrual of pension rights is measured based
on the prescribed interest rate term structure, which makes the contribution
1 For the purpose of this overview, the Incapacity/disability pension (AOP) contribution has coverage ratio sensitive to the interest rate.
been converted from the AOP state pension contribution threshold to the retirement
benefit/surviving dependants' benefit (OP/NP) contribution threshold.
Certainty – a new strategic investment plan effective in 2021, we would still not have been able to act differently at the end
of that year.
The aspect of certainty is linked to the way in which we invest pension assets.
• In the Sound management of pension assets section, we will discuss this in In recent years, we have advocated for the option to increase pensions sooner,
greater detail. and we will be glad when we are able to do so again. Although this is currently
• 2021 also included a review of the risk appetite in respect of investments – only a proposal under consideration by politicians, there is a chance that
more detail on this is provided in the Risk Management section. the minimum policy funding ratio at which we are permitted to introduce an
increase could drop from 110 percent to 105 percent on January 1, 2022. In
that case, the law would allow pension funds to decide to increase pensions
Ambition – greater potential scope for pension increases sooner. Whether a fund would actually go ahead and do so depends on various
factors. We would welcome this relaxation if it were to go ahead, as it has
The start of the reporting year saw ABP avert an imminent need to reduce been many years since we were able to increase pensions. Meanwhile, prices
pensions arising from the financial position. ABP relied on the exemption have continued to rise, at a rate that now outpaces previous years. This means
granted by Minister Koolmees and was therefore not required to reduce the same money leaves pensioners less to spend, and the value of accrued
pensions with effect from January 1, 2021. Although the funding ratio showed pension rights does not keep pace with price increases for those who have yet
a favorable development, rising from 93 percent to 111 percent, the level to take retirement.
reached by the end of 2021 was regrettably still insufficient under the current
calculation rules to allow for pension increases. ABP’s ambition is to increase Our intention is to increase pensions as soon as we are able to – if an
pensions on January 1 of the relevant year, based on the relevant price index opportunity to increase arises between July 1, 2022 and the end of 2022, the
of the preceding year (the non-derivative Consumer Price Index determined by Board of Trustees will immediately take this under consideration. Any decision
CBS for the reference period September 1, 2020 – September 1, 2021). This by the Board of Trustees to increase pensions will be preceded by a balanced
index was 2.39 percent in that period. The fact that we were unable to apply weighing of interests.
increases means realization of this ambition is 0 at January 1, 2022.
Once the NPC takes effect, pensions will move with economic developments in
We realize and appreciate that this is a cause for dissatisfaction and unease a more logical manner, thus giving participants a better understanding as to
among our participants. When it comes to potential increases or mandatory when pension increases are possible and when reductions are required.
reductions, ABP is required to follow the current rules, even if our investments
are delivering excellent returns. This is a source of concern for the Board of
Trustees too.
Now that the outlines of the transitional Financial Assessment Framework (FTK)
are emerging, we note that 2022 and subsequent years may offer pension
funds greater scope to increase pensions. But even if those rules had become
Contents Results: Sound management of the ABP Annual Report 2021 55
pension assets
Dealing with
our participants’
money responsibly
Sound management of the pension assets
concerns the responsible way in which
we deal with our participants’ money.
This section explains how we did this in
2021. We disclose not only the realized
investment return and the administration
costs, we also explain how we inform
participants and employers regarding their
financial situation.
Contents Results: Sound management of the pension assets ABP Annual Report 2021 56
Sound management of pension assets

Total available Return on Invested in the Insight, overview, and
assets assets invested Netherlands perspective for action
551.6 11.4% 22.9 Connectedness of participants

NPS -23
(€ billion, at year-end) (€ billion) 2020 -28
2020: 495.3 2020: 6.6% 2020: 20.9 Connectedness of employers

NPS +22
2020 +17
Service convenience experienced

by participants
CES score 72%
2020 72%
Strategic Costs Participants at the center
Service convenience experienced
investment policy Asset management costs as • Launch of the Pension Coach by employers
Marketable securities % of assets invested*
60% 1.08%
• Launch of the MĳnABP app CES score 95%
• Improvements to complaints 2020 90%
process
2020: 0.78% Number of complaints from
Fixed-income investments
40%
participants
Pension management Submitted 599
administration costs 2020 804
per participant
€72
Pending at year-end 2021 9
2020 16
Employers at the center
2020: €67 Number of appeals
• Further strengthening of
Submitted 52
strategic connection
2020 37
• Communication calendar
Pending at year-end 2021 27
• Employer meetings
2020 30
* Including transaction costs.

Our investment policy In 2021, we took the final step in the implementation of our three-year
strategic investment plan for 2019-2021. We focused on further increasing our
We have a number of investment tenets that are leading in the formulation investments in the real economy and the energy transition in the Netherlands
and implementation of our strategic investment policy. These tenets are the and beyond. We also invested in the laying of optical fiber in the Netherlands,
basis for the structure of our organization and the allocation of our available wind and solar parks and improving sustainability in the social housing market.
resources. They are based on academic insights, years of experience and our
current view on the critical success factors in the years to come. Some of
them are still the subject of debate in the investment world. ABP continues Return in 2021
to evaluate these tenets. Our investment tenets reflect ABP’s view of the
investment world and how we aim to be successful in that world. ABP realized a positive return of 11.4 percent in 2021, compared to 6.6 percent
in 2020. This return amounts to €56.3 billion (2020: €30.6 billion). Equities,
ABP formulates a strategic investment policy every three years, in which we alternative investments (private equity, commodities, hedge funds) and real
focus on the objectives of pensions. After the strategic investment policy is estate were the best-performing categories. Opportunities and commodities
formulated, the investments are implemented by means of fixed assignments, performed less well.
known as mandates. In the daily management of our portfolios, we strive to The interest-rate hedge reduced our return by -1.3 percent (2020: +1.1
achieve the best possible return within the limits of the mandate. There were percent); see also below in this section.
no changes to the strategic investment policy in 2021. For more detail, see the
section Results – Equilibrium between contribution, certainty, and ambition. We In 2021, our total investment portfolio outperformed the benchmark as
will establish a new strategic investment policy for the coming period in 2022. contained in the benchmark portfolio by 1.3 percent. Previously, the Board
of Trustees expressed concerns to APG regarding the negative trend in recent
Since the financial markets are always uncertain, we ensure that due years whereby the return on equities had underperformed the benchmark.
consideration is given to diversification of our investments. This diversification Adjustments were made that should lead to an improvement in relative return.
is important: our aim is to achieve a good risk-return ratio in our investment This was not yet clearly visible in 2021. ABP and APG are continuing to monitor
portfolio. ABP is cost conscious: if costs are incurred, there needs to be clear the effects.
added value. We are transparent regarding the costs we incur and regularly
have comparative studies conducted in this respect.
Return and benchmark1

Benchmark Relative Relative
Category Weighting Portfolio return Portfolio return return Difference contribution contribution
% % € mrd % % % € mrd
Fixed-income investments 39.3 -0.9 -1.5 -1.4 0.5 0.2 1.0
Government bonds 6.9 -3.5 -1.6 -3.5 0.0 0.0 0.0
Long-term government bonds 12.6 -7.0 -3.6 -7.1 0.0 0.0 0.0
Corporate bonds 14.1 4.8 3.4 3.3 1.4 0.2 1.0
Emerging-market bonds 5.6 0.9 0.3 0.9 0.1 0.0 0.0
Inflation-linked bonds 0.1 4.0 0.0 3.6 0.4 0.0 0.0
Equities 29.7 23.0 37.1 24.7 -1.4 -0.5 -2.6

Developed markets 22.7 28.8 35.3 31.0 -1.6 -0.5 -2.4
Emerging markets 7.0 4.3 1.8 4.7 -0.5 0.0 -0.2
Alternative investments 21.3 34.5 30.8 27.2 5.7 1.2 6.4

Private equity 8.2 44.6 14.1 30.0 11.2 0.9 4.9
Commodities 6.1 45.4 11.1 48.6 -2.2 -0.1 -0.8
Opportunity Fund 0.1 26.9 0.1 35.2 -6.1 0.0 0.0
Infrastructure 3.8 16.1 2.8 7.9 7.7 0.3 1.4
Hedge funds 3.2 16.9 2.6 9.9 6.4 0.2 1.0
Real estate 10.0 23.1 10.3 18.8 3.6 0.3 1.6

Real estate 10.0 23.1 10.3 18.8 3.6 0.3 1.6
Overlay -0.3 -4.1 -20.3 -3.4 0.1 0.1 0.6

Interest rate hedging -1.3 -6.3 -1.3 0.0 0.0 .
Inflation hedge 0.0 0.1 0.0 0.0 0.0 0.0
Currency hedge -2.3 -11.4 -2.2 0.0 0.0 0.1
Other -0.6 -2.8 0.0 0.0 0.0 0.1
Active Asset Allocation 0.1 0.3
100.0% 11.4 56.3 9.9 1.3 1.3 7.1
1 The outperformance is calculated geometrically. It is possible that the figures may not exactly add up to the total shown due to rounding effects.
The table presents the returns of the various investment categories Breakdown of return1
2021 2020 2019 2018 2017
compared with the benchmark. The relative contribution column presents
the contribution that the specific category makes to the total return in both Investment portfolio 12.6 5.5 15.0 -2.7 8.0
absolute amounts and percentages. Long-term investors such as pension funds Interest-rate hedge -1.3 1.1 1.8 0.4 -0.4
not only need to assess the annual return, but also the return over a longer
period. The following chart presents the cumulative nominal and real return Total 11.4 6.6 16.8 -2.3 7.6
over the past 15 years. The real return is calculated by adjusting the nominal
return for inflation. 1 Investment portfolio return calculated by adding the result of the interest-rate hedge to
the total return.
Cumulative return
(2005 = 100)
Due to the increase in interest rates, the negative effect of this on the return
300 was -1.3 percent (2020: 1.1 percent). This amounts to -€6.3 billion (2020:
Nominal return
€5.3 billion). More information on our interest-rate hedging policy is given in
Real return
the section Equilibrium between contribution, certainty, and ambition.
200
Currency hedge
The investments in US dollars, British pounds, Swiss francs, Canadian dollars,
100
Australian dollars, and Japanese yen were partly hedged in 2021. The strategic
currency hedging is designed to reduce exposure to movements in exchange
rates: ABP receives contributions and pays pension benefits in euros, while we
0
also invest in categories denominated in foreign currencies. In 2021, the total
2005 2007 2009 2011 2013 2015 2017 2019 2021 return from hedging currency risk was -2.3 percent (2020: 1.7 percent), or -
€11.4 billion (2020: €8.0 billion). The main reason for the negative return on this
hedge was the appreciation of the US dollar against the euro in the reporting
Since 2016, ABP's real return is calculated on the basis of price inflation (in year (by 7.4 percent). On the other hand, this had a positive effect on our
the years through 2015, the real return was calculated on the basis of wage investments denominated in dollars, increasing the value of these investments
inflation). In 2021, the nominal return was 11.4 percent, and the real return was in euros and adding to the return (contrary to the effect of the currency hedge
5.4 percent. previously mentioned).
Interest-rate hedging
The following table presents the return from interest-rate hedging in the period
of 2017-2021.
Composition of the investments information technology increased from 10.2 percent in 2020 to 11.7 percent,
mainly due to the effect of the coronavirus crisis on the value of this sector.
Spread by sector and region
Spreading our investments across sectors and regions mitigates risks in the Breakdown by region (in %)
investment categories. The following two charts present this risk spread in 60
2021 and 2020 (due to rounding, the totals for regions and sectors are not
always 100 percent). The figures in the charts are based on the asset items as
compared with the total assets, including positions in derivatives.
40
Breakdown by sector (in %)

30
20
20
0
North America Other EMU Asia/Pacific Other Europe Netherlands Other
10
2020 2021
0
Public Information Manufacturing Healthcare Energy Basic Utilities
authorities technology materials The spread of the investment portfolio is largely unchanged from 2020. The
Financial Real estate Luxury goods Securitized Convenience Telecommunications changes in the regions of the Netherlands and North America are largely due
institutions goods
to changes in the derivatives category. There was an increase of nearly 10
2020 2021 percent in the North America region, partly due to the positive development in
the exchange rate of the US dollar. Investments in the Netherlands, including
derivatives, declined from 8.7 percent to 5.7 percent, mainly due to the
Financial institutions and public authorities are, as in 2020, the top sectors negative development in the value of currency and interest-rate derivatives.
for ABP's investments. With our investments in government bonds, the Actual investments in the Netherlands in the leading categories of real estate,
‘public authorities’ sector accounts for 24.9 percent of our portfolio (2020: equities, and fixed-income investments amounted to €22.9 billion in 2021
22.7 percent). “Financial institutions”, accounting for 23.2 percent, is the (2020: €20.9 billion).
second largest sector, with investments in equity and corporate bonds and
financial instruments such as derivatives (2020: 27.8 percent). Derivatives are
held mainly for interest-rate hedging purposes. The proportion invested in
Hedge funds policy Investments in the Netherlands

The Board of Trustees decided in 2016 that hedge funds would no longer ABP strives to contribute to our society and the Dutch economy where this
be regarded as a separate investment category. Although investing in hedge is possible and takes a proactive approach in this regard. During 2021, this
funds is not a goal as such, ABP does invest in these funds when it is a sound included expanding our investments in infrastructure (fiber optic connections
option in the strategy of other investment categories. In line with this decision, in small communities and more remote areas, wind turbines, smart heat
we intend to transfer some of the existing investments in hedge funds to networks), real estate (hotels, student housing, outlet centers), and Dutch
other asset classes. At the same time, we will also review which of these asset businesses. We encourage joint ventures between private investors and public
management activities can be performed in-house by APG. This reduces costs, investment institutions such as Invest-NL and Groeifonds.
increases transparency, and improves control.
Support during the coronavirus pandemic
The value of the portfolio declined from €20.4 billion at year-end 2020 to In response to the coronavirus crisis and its effects on Dutch businesses, ABP
€17.4 billion at the end of 2021. The €4 billion Alternative Credits investment actively participated in the Post-COVID-19 Growth Finance Initiative in 2021. This
portfolio was transferred to Credits Investments as planned at the beginning of is an initiative of ABP and three Dutch banks to provide financial support in the
2021. Over €1 billion in hedge fund investments that were not appropriate form of subordinated loans to Dutch companies that were basically financially
to the new policy were also disposed of in 2021. Since the hedge fund sound but got into difficulties as a result of the coronavirus crisis.
investments increased in value during 2021, without these transfers and sales,
the hedge fund portfolio would have significantly increased in value. Investing in the Dutch energy transition
The ‘Climate Commitment by the financial sector’ is part of the Dutch Climate
In 2022, the majority of the hedge fund portfolio will either be liquidated Agreement. Banks, insurers, pension funds, asset managers, and their umbrella
or transferred to other investment categories. After 2022, only a limited organizations signed up to the Climate Commitment in 2019; ABP and APG
proportion of assets invested is expected to remain in illiquid hedge were among them. By signing this commitment, the financial sector entered
fund strategies. The liquidation of these illiquid funds is expected to last into several agreements, namely:
several years. • to fund the energy transition, where possible in cooperation with Invest-NL;
• with effect from 2020, to report on the CO2 emissions of relevant loans
and investments;
• by 2022, to announce action plans including reduction targets for 2030 for
all relevant loans and investments.
More information on this is provided in the section on Sustainable and

Responsible Investing.
ABP is investing nearly €1 billion in green Dutch mortgages from Vista. Acceleration of the fiber optic network
Customers are given a discount on their mortgage interest rate if they buy a ABP and KPN are investing over €1 billion in the laying of fiber optic cables in
property with an A energy label. They also get this discount if they improve nearly 1,000 villages and small residential centers. In the next five years, KPN
the sustainability of their home so that it obtains an A energy label. ABP and aims to provide fast internet via fiber optic to 2.5 million households in larger
APG are also co-founders of LIST Amsterdam, a platform for the provision of municipalities. Thanks to the cooperation with ABP, this can now be rolled out
loans to Dutch housing corporations. This platform makes it easier for housing in other areas as well. This concerns nearly 700,000 connections in villages such
corporations to obtain funding, for example for improving the sustainability of as Ankeveen, Grou and Zuidoostbeemster. By the end of 2026, they will all have
their housing stock. their existing copper connections replaced by fiber optic. Also, over 200,000
addresses at around 1,400 industrial parks will now get fiber optic years earlier
ANET, the ABP Dutch Energy Transition Fund, has been founded for than originally planned.
investments in relatively small projects and companies focusing on
technological and other solutions for the Dutch energy transition. With ANET, Boost for Dutch start-ups and scale-ups
ABP is fulfilling its commitment in 2019 in connection with the Climate Through INKEF, the venture capital investor founded by ABP for investment in
Agreement to actively contribute to funding the Dutch energy transition. ANET promising young companies, ABP primarily invests in the Netherlands. INKEF is
can contribute funding in all the development phases of a business, from start- a long-term investor that supports young companies through various funding
up capital to an initial public offering. Four investments have now been made, rounds up to an initial public offering. INKEF supports business owners in the
amounting to €75 million. These four current investments concern Rockstart development of their ideas into successful international businesses from the
(which offers start-ups an acceleration program in addition to seed capital), early stages of a technology or life science enterprise. INKEF‘s investments
Dorothea (which invests in smart heat networks), Net2Grid (a supplier of in 2021 included Sentinels (fintech), Anavo (biotech/health), Lengoo (artificial
artificial intelligence technology to utilities) and the Energy Impact Fund (which intelligence) and ChannelEngine (technology).
invests in growth companies related to the energy transition).
Asset management costs The increase in investment costs (€2,041 million) was largely due to higher
performance fees. There were two main reasons for the increase in
Higher returns, higher investment costs management fees (€153 million). The first concerns an increase in the internal
ABP realized a much higher return in 2021 than in 2020. The categories management workload at the administrator APG in relation to alternative
of equities, alternative investments (private equity and commodities) and investments and additional investments in digitalization and responsible and
real estate were the best performers; fixed-income investments such as long- sustainable portfolio management. The second concerns higher fees paid to
term and other government bonds performed less well, due to the rise in external private equity managers resulting from the realized return in 2021.
interest rates. The asset management costs increased significantly, mainly This substantially increased the performance fees paid for private equity. In all
due to the higher returns. These returns were realized primarily in the ‘more asset categories, performance fees are paid out of realized returns.
expensive’ investment category of alternative investments. Further explanation
is given below. Asset management costs in context
Partly due to the size of the investment portfolio and despite the scale
The increase in the costs of asset management has the full attention of the benefits that this provides, the asset management costs are high in absolute
Board of Trustees. Our plans for managing these costs are explained in the terms. This regularly raises questions regarding the usefulness or necessity
Outlook at the end of this section. of these costs. An active investment style entails higher costs than a passive
style that simply follows a benchmark. Asset management costs can be most
Return in relation to investment costs accurately assessed if account is taken of the targeted or other return, the risk
€ mln Total 2021 Total 2020
diversification, the size of the assets invested and the realized performance.
Gross return 61,375 33,579
Investment costs -5,057 -3,016 Management fees
Net return 56,318 30,563 Management fees can be influenced by the Board of Trustees to some extent,
through decisions in relation to portfolio composition. Benchmark research
Management fees 1,629 1,476 shows that an internally managed portfolio often entails lower costs than an
Performance fees 3,428 1,540
externally managed portfolio. ABP aims to find an optimal balance between
Investment costs 5,057 3,016
internally managed portfolios and outsourcing to specialist external managers.
A decision to invest in a liquid or illiquid asset category also leads to different
levels of cost, with higher costs for the latter.
A breakdown of the net return is provided in the table Return and benchmark
(see page 57)
The Board of Trustees closely monitors the level of management fees. Placing ABP pays performance fees in relation to illiquid investments on the basis of
more management activities with our administrator APG will reduce the high realized returns. This means that, until returns are realized, performance fees
fund-of-fund fees involved, especially for private equity. Opting for more direct are determined – but not necessarily paid – based on unrealized returns. It is
investments in infrastructure and real estate rather than in funds has reduced therefore possible that the reserve for performance fees has to be adjusted
the management and performance fees to be paid to external managers. downwards when a lower return is realized over a certain period of time. This
will result in a negative performance fee over the period concerned.
Performance fees
For mandates to external asset managers, APG makes agreements on Transaction costs
performance fees on the instruction of ABP. External managers only receive Transaction costs arise from the purchase and sale of investments and are
a performance fee if they realize a return that is higher than a minimum agreed related to the volume of the assets under management and our active
benchmark or other return. ABP pays this performance fee from the extra investment style.
return realized. A higher return benefits our participants, but it also means
higher costs. Asset management costs have been in a rising trend since 2019, in both
absolute and relative terms. This is mainly due to rising performance fees,
most notably the increase in performance fees for 2021. This outlier is directly
related to the good returns. For relative management fees, the declining trend
in past years is flattening out. This is mainly due to a significant increase in
Investment costs and transaction costs 2017 – 2021

2021 2020 2019 2018 2017
€ mln % € mln % € mln % € mln % € mln %
Management fee 493 0.100 409 0.089 380 0.086 362 0.088 343 0.088
External asset managers' fees 908 0.180 835 0.183 851 0.193 794 0.194 827 0.211
Custody fees 50 0.010 58 0.013 51 0.012 53 0.013 50 0.013
Other expenses 178 0.030 174 0.038 172 0.039 161 0.039 170 0.044
Management fees 1,629 0.310 1,476 0.323 1,454 0.330 1,370 0.334 1,390 0.356
Performance fees 3,428 0.660 1,540 0.337 1,058 0.240 1,090 0.266 1,131 0.289
Investment costs 5,057 0.980 3,016 0.660 2,512 0.570 2,460 0.600 2,521 0.645
Transactioncosts 539 0.100 532 0.116 431 0.089 397 0.097 467 0.119
Total cost asset management 5,596 1.080 3,548 0.776 2,943 0.659 2,857 0.697 2,988 0.764
the management fee for APG, among other things in relation to investments in Movements in total investment costs
digitalization and an increase in internal management. The higher management The table “Movements in total investment costs by category” shows the total
fee for external asset managers is due to the increase in assets invested. management fees and performance fees paid for each investment category.
Two ratios are also presented to clarify the amount of the costs and their
Reconciliation of asset management costs movements over time: ‘% per category’ and ‘% of total’. The first ratio expresses
The asset management costs are recognized in the financial statements in the cost of an investment category as a percentage of the net asset value
accordance with Guideline 610 of the Dutch Accounting Standards. This relates (NAV) of that investment category and reflects the relative expensiveness of
to the invoiced costs. Non-invoiced asset manager costs are netted off against an investment category. The second ratio, ‘% of total’, shows the costs of an
investment results in the financial statements. As a result, the costs recognized investment category as a percentage of the total assets of ABP. This ratio shows
in the financial statements (Notes to the Separate Statement of income and which investment category made the greatest contribution to the total costs.
expenses; see the table of Investment results [net]) are lower than the amount
recognized in the Report of the Board of Trustees. The reconciliation between As shown in the table, the costs for alternative investments (0.83 percent) are
the two is presented in the table below. higher than the category with the lowest costs, fixed-income investments (0.09
percent). The alternative investments category accounts for 10.1 percent of the
Reconciliation of asset management costs in the financial statements portfolio and is responsible for 76.1 percent of the asset management costs.
The Board of Trustees takes a critical look at these costs. Private equity in
in € million Total 2021 Total 2020
particular is an asset category with high fees. However, this category made a
Report of the Board of Trustees significant positive contribution to returns in 2021 and also offers improved
Management fees 1,629 1,476 diversification of risk.
Performance fees 3,428 1,540
Transaction costs 539 532 The actual costs of illiquid investments in the fourth quarter are not always
available in time. When this is the case, the actual costs in the first through the
Total 5,596 3,548
third quarter are recognized and supplemented with an estimate for the fourth
quarter based on the actual costs for the fourth quarter in the previous year.
Financial Statements
Directly invoiced costs: Management fee 609 475
Variance: 4,987 3,073

Relates to directly invoiced costs (part of the investment
results in the financial statements)
Movement in total investment costs by category
In € mln 2021 2020
Average % per class % of total Average % per class % of total

managed assets managed assets
Fixed-income investments 443 - 0.086 136 0.030
Government bonds 98,935 14 0.014 0.003 86,254 36 0.041 0.008
Corporate bonds 71,933 371 0.516 0.072 63,428 66 0.104 0.014
Emerging-market bonds 27,532 58 0.211 0.011 19,033 34 0.179 0.007
Inflation-linked 3 - 0.001 6 0.001

Inflation-linked bonds 1,502 2 0.118 0.000 10,640 5 0.043 0.001
Alternative Inflation 686 1 0.135 0.001 742 1 0.100 0.000
Equities 257 - 0.050 478 0.104

Developed markets 139,940 126 0.090 0.024 116,616 261 0.224 0.057
Emerging markets 40,187 131 0.326 0.025 35,412 217 0.612 0.047
Alternative investments 4,290 - 0.828 2,387 0.522

Real estate 48,622 250 0.513 0.048 42,750 174 0.407 0.038
Private equity 35,605 3,372 9.471 0.651 25,934 1,411 5.441 0.309
Opportunity Fund 556 27 4.789 0.005 679 -14 -2.047 -0.003
Commodities 31,250 30 0.095 0.006 19,358 59 0.305 0.013
Infrastructure 17,946 136 0.760 0.026 15,600 148 0.947 0.032
Hedge funds 16,862 476 2.823 0.092 20,474 609 2.974 0.133
Overlay 64 - 0.012 10 0.002

Overlay & other -13,341 64 - 0.012 196 10 0.002
Total management and

performance fees 518,216 5,056 - 0.976 457,117 3,016 0.660
Movement in total management fees by category
In € mln 2021 2020

Fixed-income investments 204 - 0.039 135 0.029
Government bonds 98,935 14 0.014 0.003 86,254 36 0.041 0.008
Corporate bonds 71,933 138 0.192 0.027 63,428 65 0.103 0.014
Emerging-market bonds 27,532 52 0.188 0.010 19,033 34 0.179 0.007
Inflation-linked 3 - 0.001 5 0.001

Inflation-linked bonds 1,502 2 0.118 0.000 10,640 5 0.043 0.001
Alternative Inflation 686 1 0.135 0.000 742 1 0.100 0.000
Equities 273 - 0.053 195 0.043

Developed markets 139,940 158 0.113 0.031 116,616 112 0.096 0.024
Alternative investments 1,086 - 0.209 1,130 0.247

Real estate 48,622 188 0.387 0.036 42,750 206 0.483 0.045
Private equity 35,605 538 1.510 0.104 25,934 475 1.831 0.104
Opportunity Fund 556 10 1.794 0.002 679 12 1.721 0.003
Commodities 31,250 44 0.139 0.008 19,358 51 0.261 0.011
Infrastructure 17,946 105 0.583 0.020 15,600 108 0.695 0.024
Hedge funds 16,862 202 1.195 0.039 20,474 278 1.359 0.061
Overlay 64 - 0.012 10 0.002

Overlay & other -13,341 64 - 0.012 196 10 0.002
Total management fees 518,216 1,629 - 0.314 457,117 1,476 0.323

Movement in total performance fees by category
In € mln 2021 2020

Fixed-income investments 239 - 0.046 1 0
Government bonds 98,935 - - - 86,254 - - -
Corporate bonds 71,933 233 0.323 0.045 63,428 1 0.001 -
Emerging-market bonds 27,532 6 0.022 0.001 19,033 - - -
Inflation-linked - - - - - -
Inflation-linked bonds 1,502 - - - 10,640 - - -
Alternative Inflation 686 - - - 742 - - -
Equities -16 - -0.003 282 - 0.062

Developed markets 139,940 -32 -0.023 -0.006 116,616 149 0.128 0.033
Alternative investments 3,206 - 0.619 1,257 - 0.275

Real estate 48,622 61 0.126 0.012 42,750 -33 -0.076 -0.007
Private equity 35,605 2,835 7.961 0.547 25,934 936 3.61 0.205
Opportunity Fund 556 17 2.994 0.003 679 -26 -3.768 -0.006
Commodities 31,250 -14 -0.045 -0.003 19,358 9 0.044 0.002
Infrastructure 17,946 32 0.177 0.006 15,600 39 0.252 0.009
Hedge funds 16,862 275 1.628 0.053 20,474 331 1.616 0.072
Overlay - - - - - -
Overlay & other -13,341 - - - 196 - - -
Total performance fees 518,216 3,428 - 0.661 457,117 1,540 - 0.337

Movement in total management fees In 2021, private equity achieved a gross return before deduction of costs of
For the portfolio as a whole, the management fees declined slightly by €17.4 billion. After deduction of all management and performance fees, the
0.01 of a percentage point to 0.31 percent (see the table “Movement in net return was €14.1 billion (= 44.6 percent net return). The asset category of
total management fees by category”). For a number of asset categories, hedge funds achieved a gross return of €3.1 billion in 2021. After deduction of
the management fees per investment category vary in comparison to all management and performance fees, the net return was €2.6 billion (= 16.7
2020. A notable difference concerns corporate bonds: in this category, the percent net return).
difference arises because investments in hedge funds focusing on fixed-income
investments have been transferred to the category of corporate bonds. These Within the total asset management costs, which are high despite scale benefits
investments are managed externally, and the related costs are higher than for due to the large size of ABP’s portfolio, the performance fees are directly linked
the internally managed corporate bond portfolio. The increase in management to the realized return. The investments in illiquid investments in particular
fees for both categories of equities is due firstly to an increase in the capital were responsible for the increase in performance fees. The Board of Trustees
and secondly to more external management. The costs for real estate and considers higher performance fees to be justified, as these investments make
infrastructure are lower, due to an increase in direct investments and fewer a very positive contribution to the risk and return profile. At the same time,
relatively expensive investments in externally managed funds. In the case of we consider the amount of performance fees to be high in absolute terms and
private equity, after the investment period, the management fee is calculated difficult to justify to the participants who have been waiting for an increase in
on the capital invested. The relative management fees have declined as a result their pensions for many years. See also the Outlook at the end of this section
of increases in value in the private equity portfolio. for the action we intend to take.
Movement in total performance fees In the case of equity investments, the performance fees for external managers
Total performance fees are higher in both absolute and relative terms are calculated on the basis of the excess return realized relative to a
compared to 2020; see the table “Movement in total performance fees by benchmark. Negative excess returns were realized for both equities in
category”. Within the portfolio, there was a particularly large increase in the developed markets and equities in emerging markets in 2021. This led to lower
performance fees for private equity. On the other hand, performance fees performance fees paid in 2021 than in 2020. However, costs for performance
for equities in developed markets and equities in emerging markets declined. fees may sometimes be due even with negative excess returns, with a negative
These movements are due to the realized returns of these asset categories in performance at asset category level. This is because specific agreements may
2021 and 2020 relative to the benchmark or an absolute return target. The be made with external asset managers.
increase in corporate bonds is due to the transfer of part of the externally
managed hedge fund investments to this asset category. The table Return and benchmark (see Return in 2021) shows the net returns for
all asset categories in percentage and absolute terms.
Movement in transaction costs by category Market comparison of the asset management costs
Although we are aware of the limitations of benchmark surveys, as the Board
Transaction Transaction
of Trustees, we consider it important to test ABP's asset management costs
In € mln costs 2021 costs 2020
against those of other national and international funds and to assess whether
these amounts have been used effectively. ABP accordingly participates each
Government bonds 19 30
year in the annual Cost Effectiveness Measurement (CEM) benchmarking
Corporate bonds 121 105
Emerging-market bonds 64 53 survey, in which costs and realized returns are compared with those of
comparable national and international peers.
Inflation-linked
Inflation-linked bonds 2 8 The peer group to which ABP belongs for the comparison of asset management
Alternative Inflation 0 0
costs consists of international pension funds, as these are of comparable size
and have comparable activities. The peer group to which ABP belongs for the
Equities
Developed markets 32 41 comparison of return and added value consists of Dutch pension funds, due to
Emerging markets 82 59 the specific regulation applying to Dutch pension funds.
Alternative investments ABP’s costs are higher in comparison to its international peers. The
Real estate 26 34
implementation of the decisions we make for our investment portfolio involves
Private equity -8 -2
higher costs than the costs of our peers. In addition, the performance
Opportunity Fund 1 1
Commodities 14 14 fees we pay for private equity are relatively higher than those of our
Infrastructure 61 42 international peers.
Hedge funds 64 109
The CEM benchmarking shows that, over the past five years, after deduction of
Overlay
all costs, ABP belongs in the top quartile (25 percent) of funds as measured
Overlay & other 61 38
on realized added value. This added value is the difference between the
Total 539 532 actually realized return and the benchmark return. The most recent CEM
report (in 2020) shows that ABP’s average added value over five years of 1.1
percent is higher than the average scores for its Dutch peers (0.4 percent)
Total transaction costs rose by €7.3 million to €538.9 million in 2021. At asset and its international peers (0.3 percent). Most of this added value is due to
category level, there were no significant differences compared to 2020. investments in illiquid categories. The costs incurred thus clearly add value.
Outlook for 2022

The development in our asset management costs is a matter of concern for the
In benchmark research, ABP Board of Trustees. Despite the realized returns, costs are rising to an amount
has been ranked among the that is increasingly difficult to justify to our participants and other stakeholders.
top 4 pension funds for The Board of Trustees always monitors costs closely, but we have decided to
delivered added value again critically review the principles influencing our asset management costs
for 5 consecutive years. in the course of 2022. This review will include our investment tenets and fee
principles. We are also considering having our investment portfolio analyzed
with respect to the development of costs. These additional measures will be an
addition to our existing policy; the Board of Trustees thereby aims to make an
extra effort in combating the rising trend in asset management costs.
Pension management costs ABP versus CEM benchmark

100
The costs for pension management in 2021 amounted to €156 million. The
costs per participant came to €72, an increase of €5 compared to 2020. This
90
expected cost increase was due to the investment in the Grip program on data
Dutch funds
(see below in this section) and the preparations for the new pension contract.
80
The total pension management costs also include a sum of €11.8 million in
costs incurred by the Executive Office and the Board of Trustees: these are ABP
specified in the financial statements. 70
We consider it important to compare ABP's cost performance with 60

comparable pension funds. For this, we use the CEM benchmark for pension 2017 2018 2019 2020 2021
administration. Our cost per participant in 2021 of €72 was still well below the
average figure for large Dutch pension funds of €84 (this is an average figure
for 2020, as the CEM figures for 2021 are not yet available). Outlook for 2022
Due to the investment needed to order and maintain the data in our
administration, improve the participant and employer experience, and prepare
for the new pensions contract, we expect pension management costs to rise
further in 2022.
Pension management costs

2021 2020 2019 2018 2017
Pension management administrative expenses (x € 1,000) 156,363 141,149 141,129 144,729 149,962
Number of participants (active and retired) 2,178,130 2,121,533 2,061,333 2,015,200 1,979,560
Cost per participant in € 72 67 68 72 76

Difference vs last year 5 -1 -4 -4 -3
Insight, overview and perspective for action The MĳnABP app

We also introduced the MijnABP app in 2021. This allows access to the
For us, careful management of the pension assets is inextricably linked with MijnABP environment from mobile devices. Thanks to the link to the DigiD app,
providing insight, overview and a perspective for action for our participants and users only have to log in once. The app was developed in consultation with
employers. Below, we list some of the most important developments in this participants. Since going live at the end of November 2021, the app had been
area during the reporting year. downloaded 3,524 times at year-end 2021, and there have been 470 log-ins on
average per day. We are using feedback from users to further improve the app,
For participants for instance by adding the messages box. We will bring the app to the attention
of all participants in 2022.
Launch of the Pension Coach
The Pension Coach is new: an instrument based on artificial intelligence (AI) Issuing pension statements
that assists participants aged between 55 and 67 years in applying for their ABP sends the UPO (Uniforme PensioenOverzicht, or Uniform Pension
pension. We made a pilot study with 6,000 participants during the reporting Statement) prescribed by law to all participants each year. We send these
year, and the Pension Coach was given a high rating. The Pension Coach has statements to inform our participants on the financial status of their pension.
been available to participants in the target group since the fourth quarter Participants may also view this information online via Mijnpensioenoverzicht.nl.
of 2021.
Pension statements
2021 2020
€1 of contribution = €2 to €3 in pension
UPO
We invest the contributions from participants and employers in
Sent UPOs on September 30 99.42% 99.13%
order to turn them into a good pension. Pension = contribution
Sent UPOs on December 31 99.97% 99.92%
+ return (less costs). Because pensions are a complex and
Participants with access to MPO on December 31 99.93% 99.88%
emotional subject, we have looked at what a pension actually now
means for our participants. For each euro paid as contribution, a GUPO
participant will receive €2 to €3 in pension on average. There may Sent GUPOs on December 31 99.98% 99.98%
be a difference between pensioners (retrospective method) and
active participants (prospective method). Currently, this 1:3 ratio SUPO
applies approximately to all our participants. Further information SUPOs made available on December 31 99.80% 99.81%
is available on the ABP website.
EUPO
EUPOs made available on December 31 92.46% 92.46%
Statutory guidelines apply to both the content and the issuance of UPOs. All the reporting year, at the request of ex-partners. This goal was not realized due
UPOs must have been sent out on the reference date of September 30 in any to pressure on data and systems. Improving this process has a high priority.
year. ABP did not manage to meet this deadline for all participants in 2021,
mainly because required information was missing for a number of participants. Appeals and complaints
We agreed with APG that 99.0 percent of the participants must have received The most important issues raised in appeals were the amount of the
their UPO or that the information must have been made available to them via retirement pension and partner’s pension, the concurrent years of service
MijnABP by September 30, 2021. By December 31, 2021, this must include 99.8 supplement and changes to the pension statement as a result of the change
percent of the participants. This goal has been realized. We sent a letter to in the state pension age.
inform participants who had not received a UPO by December 31, 2021, and
gave them personal answers to their questions. The Appeals Committee made 46 rulings in 2021. In 43 cases, the participant’s
appeal was rejected and declared to be unfounded. In three cases, the
Participants entitled to pension receive a GUPO (Gepensioneerden Uniform Appeals Committee upheld the appeal and ruled in favor of the participant.
Pensioenoverzicht, or Retired Employee Uniform Pension Statement). The In one case, the participant’s appeal was rejected, but the Appeals Committee
statutory guideline here is that all GUPOs must have been sent by December granted compensation for reasons of leniency. In nine cases, ABP upheld the
31. As in previous years, this target was not met, because necessary participant’s appeal. The Appeals Committee did not need to make a decision in
information was lacking in some cases here as well. In addition, we did not these cases, as the participants subsequently withdrew their appeals.
manage to include the surviving dependents’ pension rights in the GUPOs for
some of our pensioners. We are working on a permanent solution to this Number of appeals
2021 2020 2019 2018 2017
issue. We have made a realistic agreement with APG that 99.8 percent of the
target group must have received a GUPO by December 31, 2021. This target Appeals lodged 52 37 36 27 40
was achieved. Appeals procedures terminated
without ruling 9 3 7 7 10
Ruling: decision upheld 43 26 24 25 33
Pension administrators are also required to issue a UPO to inactive
Ruling: decision overturned 3 1 1 10 9
participants. A realistic SUPO (the “S” stands for “sleepers”) agreement has been
Outstanding on December 31 27 30 23 19 34
reached with APG, whereby 99.8 percent of the inactive participants must have
received a SUPO or have had a SUPO made available to them on MijnABP by
December 31, 2021. This goal has been realized.
By law, pension funds must issue a digital or hard-copy EUPO (Ex-partner

Uniform Pensioenoverzicht, or Ex-Partner Uniform Pension Statement) every
five years. The agreement with APG was that 99.8 percent of ex-partners must
have received an EUPO by December 31, 2021. EUPOs were issued manually in
Processed complaints by type We continually work on improving our services based on feedback from
2021 2020 2019 2018 2017
participants and employers. ABP and APG have set up special processes
Information provision 237 420 34 63 45 (feedback loops) for this. Stichting Gouden Oor audited these processes in
Processing delay 47 7 10 25 20 2021, awarding ABP a score of level 2. This shows that an organization listens
Application of laws closely to signals from customers and also actually takes action as a result.
and regulations 11 85 11 30 21
We are pleased with this result, and see the Gouden Oor certificate as an
Customer friendliness 136 164 3 7 4
encouragement to continue on our current course towards the highest score of
Pension calculation
level 3.
and payment 77 24 30 46 53
UPS 0 0 0 - 2
MijnABP 78 83 0 0 0 Postponement of projects
Other 13 21 32 60 92 Due to the focus on and urgency of the program to improve the quality of
Complaints ANW compensation 0 0 0 358 0 our administration (see also below in this section), certain changes to MijnABP
Pilot complaints through KCC 0 0 124 0 0 have had to be postponed. The introduction of the new house style on the
Total complaints 599 804 244 589 237 ABP website has also been postponed. This project now has a lower priority,
Outstanding on December 31 9 16 4 3 10 as we believe it has less direct effect on the experience of our participants
and employers.
Fewer complaints were submitted in total in 2021. There was an increase in What participants think of us
complaints relating to pension calculation and payment, mainly due to the The relational NPS (rNPS) score shows the extent to which participants
concurrent years of service issue. There was a sharp decline in complaints would choose ABP if they were able to arrange their pension themselves.
relating to the provision of information. This could be the consequence of our The relational NPS (rNPS) of our participants in 2021 was -23. This is an
focus on using simpler language in our communication with participants. We improvement on 2020, when the rNPS came to -28. The Board of Trustees
also continually adjust our information provision based on the feedback we approved a strategy for improving the participant experience in 2018. At that
receive from participants and employers. time, the rNPS score was less than -30. The aim of this participant experience
strategy is to improve services to and communication with our participants. The
A new procedure for participants wishing to express their dissatisfaction goal here is to bring the rNPS closer to zero. We have seen steady progress in
(complaints and objections) introduced in 2020 is more transparent, accessible, the right direction in recent years, but we are continuing to work on improving
and simpler. This process was improved further in 2021. ABP has published our services to participants.
summaries of the Appeals Committee’s decisions on its website since the
third quarter of 2021, allowing participants to view the issues put before the
Committee. The Appeals Committee regulations have also been simplified and
summarized in a flyer.
The Net Promoter Score (NPS) is a measure of the connectedness and trust of New: the Communication Calendar
customers (for ABP participants). To what extent, on a scale of 1 to 10, would The Communication Calendar was a new feature in 2021. We prepared
participants choose ABP if they were able to arrange their pension themselves? this calendar in response to requests from employers, so that they can
Thisquestion is asked once a participant or employer has made use of a specific communicate proactively with employees on pension matters, in line with the
channel or procedure. The NPS is then calculated by deducting the percentage communications from ABP.
of scores of 6 or lower from the percentage of scores of 9 or higher. The NPS
can range from minus 100 to plus 100. A representative score is obtained by Successful employer meetings
calculating on the basis of a 12-month moving average. We also held three online employer meetings, at which key issues
were discussed:
In our drive to improve our service, we continually measure whether our • financial performance;
participants think we are being successful in this. The Customer Effort Score • sustainable and responsible investing;
(CES), which shows the extent to which they experience our service as • responsible management of the pension assets;
convenient, came to 72 percent in 2021 (2020: 72). A number of planned • the equilibrium between contribution, certainty, and ambition
improvements, including in the digital participant environment, have been and indexation.
postponed to 2022. We expect the CES to rise again in 2022. Participation at these meetings was high (average of 870 participants from 719
employers), and the meetings were assessed with an average score of 7.7.
For employers
What employers think of us
Further strengthening of strategic connection We need to know how our employers rate us, as this enables us to verify that
We continued to work on our strategic connection with employers in 2021. we are doing the right things and are doing things well. We are particularly
One of the tools we use for this is the Werkgeversspiegel (employer mirror). interested in two scores: the average Customer Effort Score and the relational
With this tool, employers can use pension data from ABP for their strategic NPS. The average Customer Effort Score (CES), which measures the extent to
personnel planning. In 2021, we saw that employers and sectors are also using which employers experience our services as convenient, increased from 90
the tool for CLA negotiations and benchmarking. The response from employers percent at year-end 2020 to 95 percent at year-end 2021. This is well above our
was positive and acknowledges the added value from ABP: the data helps target of 90 percent. The relational NPS (rNPS), which measures the extent
them to formulate sounder policy and specific choices with respect to HRM to which employers would opt for ABP if they could personally make the
and employment benefits. They can thus more effectively position pension as arrangements for their employees’ pensions, increased from +17 at year-end
an important employment benefit. We started the development of an online 2020 to +22 at year-end 2021. This fell short of our target of +25. The Board of
HR data portal in 2021, which is expected to be in operation in 2022. This will Trustees is satisfied with the CES score of 95 percent and also the increase in
enable employers, sectors, and the social partners to work with their own data. the rNPS score to +22. But it is still important to continue to develop and renew
our services, on the basis of requests and wishes from our employers. This will
enable us to continue to build on the solid foundation we have laid.
Improving the quality of administration We were on schedule in 2021: 16 remedial actions were planned, all of which
To be able to provide insight, an overview and perspective for action to were completed.
participants and employers, our administration has to be correct, especially
given the imminent transition to the new pension contract. Accordingly, we However, as the year progressed, further source research revealed that more
initiated a program to detect and remedy past inaccuracies and omissions in remedial actions were needed than originally thought. This is mainly due
2019, based on the principle that all participants receive what they are entitled to the complexity of the current pension scheme, and then mostly due to
to and what they were entitled to in the past. the complications of Appendix K. The Board of Trustees raised this issue
with the social partners in the Pension Board in 2021. This did not lead to
This project is a top priority for ABP and APG. ABP has assembled a team any actual simplifications, and we hope to resolve these complexity issues
to supervise the program that was formulated together with APG: 100 when transitioning to the new scheme. The additional remedial actions will be
employees at APG are involved with its implementation on a full-time basis. included in the current improvement program.
The larger number of remedial actions in combination with the available

capacity at APG is a matter of concern for the Board of Trustees. We
have consulted directly with APG’s Executive Board on the matter and are
monitoring progress closely. ABP will receive an action plan from APG in the
first half of 2022 stating how this will be dealt with and giving a timeline for
implementation of remedial actions in the coming years.
During the reporting year, it also emerged that more than 15,000 participants
who received compensation due to the concurrent years of service provision
suffered a tax disadvantage as a result. ABP began to take action to
compensate for this in 2021, with participants who received an offer of
compensation from ABP receiving the money in February and March 2022.
DNB assessment
The supervisory authority DNB assessed the management by ABP of the data
95% 22 quality of the administration performed by APG. The review report has now
been shared with us. Based on DNB’s findings, our own policy with respect
Customer Effort Score Relational NPS
to data quality, and our continuing insight from the improvement program
2020: 90% 2020: 17
ambition: 25 mentioned above, ABP is formulating an action plan to ensure that our
administration is brought up to standard and remains up to standard.
The value of a pension

Jan van Geloof is HRM policy officer at
BUas. His work mainly concerns employment
benefits, legal matters, social security, tax
matters, and pensions.
“Pension contributions are an important part of our personal

expenses, and for us as an employer, a pension clearly adds value.
After all, government and educational institutions cannot attract
candidates with high salaries and company cars. This means it
is very helpful if, when discussing employment benefits, you can
say that you can offer an excellent pension. We believe it is very
important to mention this explicitly. But it is still difficult to turn
this into a trigger for people to come to work for us: we have
noticed that pension is still not really an appealing issue. As an
employer, we are trying to change this, with the help of ABP.
The fact that a good pension is arranged with ABP may also
Pension is an attractive employment benefit have another side, in that it can mean that people think they do
not need to worry about it. As an individual employer, we are
‘For us, a not able to make any changes to the pension scheme itself, but
there are several options open to participants. This is something
pension clearly that employers can discuss with participants. I can indicate the
financial consequences to my colleagues and show them the value
adds value’ of their pension. If they know this, they can make well-considered
decisions. This can prevent financial and other problems later on.”
Jan van Geloof

Breda University of Applied Sciences (BUas)
Contents Risk management ABP Annual Report 2021 79
How ABP
manages risk
Risk management is deeply embedded in
our organization and processes, due to our
responsibility to participants and employers
and our social duty. This section gives a brief
description of how we manage risk and the
key themes and activities in this context
in 2021.
Our risk management Our risk principles
The goal of ABP’s risk management is to create and protect value. ABP's
proactive and integrated risk management ensures that the risks that threaten
Our risk principles
the realization of ABP's strategic goals are identified, analyzed, and controlled.
Risk control goals
We have adopted six guiding risk principles that apply to all our activities and
Behavior and culture
Value were not changed in 2021:
Risk estimation
Creation &
Protection Ownership
• Our risk control makes a distinction between risks taken with the aim of
Proportionality generating a return and risks arising from the pension funds’ performance
Dynamic of its core tasks.
• We strive to create a culture that does justice to risk control, and as the
Board of Trustees, we promote the importance of risk management in our
words and our deeds: the tone at the top is the determining factor. We
Our risk management framework ensure that risk management is integrated in the day-to-day work at all
levels in the organization.
Design of the framework
• Decision-making is always preceded by an adequate assessment of risk,
Implementation of the framework
Leadership & with transparency regarding the relevant facts on which decisions are
Commitment Evaluation of the framework
Improvements to the framework based. Therefore, the probability and impact of identified risks are always
estimated in advance, and risk control must be in line with the risk appetite
• Risk management is an inseparable part of the primary processes. Risks are
allocated to the logical portfolio owner and are independently monitored.
• We apply the principle of proportionality when implementing control
measures: the advantages must outweigh the costs.
Our risk management process • Risks are constantly changing. We act on new and changing risks.
Assessment of risks
Tone at the top
Scope, Dealing with risks
Context, &
The second risk principle, the tone at the top, was extensively tested in the
Criteria Monitoring and reporting
Improvements to the process reporting year. An analysis of the operation of this risk principle was conducted
for the Board of Trustees, the ABP organization, and APG. The general Board
of Trustees will work on the findings in 2022, including a refinement of its
integrity policy.
Our risk management framework

Risk taxonomy
The risk management framework is our instrument for the integration of
risk management in the business operations of ABP. Our risk management Environmental risks
framework is based on organization (risk governance), the risks that we identify
• Support among participants, employers and other
(risk taxonomy), and the risks we are or are not prepared to take (risk appetite). stakeholders
These elements are briefly explained below. • Economic and social developments
• Financial trends
Our risk management organization
ABP has organized its risk management on the basis of the three lines of
defense model; this was not changed in 2021:
Strategic risks
1st line • ABP services
Since January 1, 2022, the Executive Board (EB) has been responsible for daily • Pension as an appealing fringe benefit
operations and the associated risks. • Good pension for the future
2nd line
The key risk management officer has an independent position and is
Risks to solid foundations
responsible for providing a countervoice to the 1st line. The key risk
management officer gives an independent assessment of the efficiency and • Governance and organization
• Operational implementation
effectiveness of ABP’s risk management.
• Reporting
3rd line
The key internal audit officer monitors that the interaction between the
first and second lines is functioning correctly and gives an objective, Risks to ethical foundations
independent opinion.
• Culture
• Behavior
Risks we identify • Compliance
This figure shows the four main categories of risk that we identify.
Environmental risk: the interest-rate exposure of the funding ratio

ABP has not fully hedged its interest-rate risk. The table shows the interest-
rate exposure of the funding ratio in more detail. If investment returns are
positive and market interest rates rise, the funding ratio will rise. If the
investment returns are negative and interest rates decline, the reverse applies.
For example, if the interest rate declines quickly by 0.5 of a percentage point
at the beginning of 2022 and marketable securities do not rise in value, the
funding ratio will fall from 111 percent to 104 percent.
Interest-rate exposure of the funding ratio
Change in the market interest rate

We have set out
Return on -1.0% -0.5% 0.0% 0.5% 1.0% the risks ABP is
marketable
prepared to take in
securities
30% 116% 123% 131% 138% 147%
pursuit of the
20% 110% 117% 124% 131% 139%
strategic objectives
10% 104% 111% 117% 124% 132% of our roadmap.
0% 98% 104% 111% 117% 124%
-10% 92% 98% 104% 110% 117%
-20% 86% 92% 97% 103% 109%
-30% 81% 86% 91% 96% 102%
How much risk does ABP wish to take?

We have established how much risk ABP is prepared to take in striving
to achieve the strategic objectives in our road map. The diagram “Risk
taxonomy“ illustrates our risk appetite and how we have assessed this during
the reporting year.
Assessment of risks against risk appetite
Sub-strategy Risk appetite Risk assessment

1. Our pension management (administration and
Low ABP is not prepared to run the risk of being overtaken by the market and
Low ABP received a score of well over 72% on participant
communication) is focused on the experience of disappointing participants and employers who feel that they are no longer at the satisfaction. The CES score from employers rose to 95%.
participants and employers center We use feedback from participants to continuously
improve our services. In 2021, Stichting Gouden Oor

Low ABP is not prepared to run the long-term risk of inadequate maneuverability assessed our feedback loop. We scored well and want to
to deliver future-proof services. do even better next year.
2. Our asset management delivers an optimum sustainable

Low ABP is not prepared to run the risk of being unable to make an active Low In 2021, ABP once again came top of the list of
and responsible return contribution to a sustainable and responsible world and intends to achieve this sustainable Dutch pension funds. Climate change impacts
with sustainable and responsible investments. our investments. APG has developed a dashboard that
provides insight into aspects such as the reduction in the

Low ABP is not prepared to run the risk of inadequate accessibility of investment CO2 footprint of our investments.
data in any circumstances, including circumstances that are not foreseeable at
present.
3.Our pension scheme is simple, controllable,

Average ABP is, in the short term, prepared to run an average risk of negative
Average We are aware that gaps in our records are
and explainable sentiment due to the implementation of improvements to our solid foundations. perceived as errors by participants. We take this
extremely seriously. Our principle is that all participants

Low ABP is not prepared to run the risk that participants do not receive the ought to receive what they are entitled to.
pension to which they are entitled or do not have adequate insight into their
pension rights/pension.
4.Our financial structure has an equilibrium between

Low ABP is prepared to run a slight risk that the long-term ambition of a 100%
High The funding ratio at the close of 2021 was not high
contribution, certainty, and ambition pension result is not achieved. enough to increase pensions. Indexation arrears are
increasing. The start of 2021 saw ABP avert an imminent
Average In the short term, ABP is prepared to run an average risk that pension need to reduce pensions.
rights need to be reduced.
5. We are committed to a good pension system in the

Average Average ABP is prepared to run an average risk of negative sentiment
Average As a result of the transition to a new system and
Netherlands due to a position adopted by ABP on the modernization of the pension system. a further shift of risks towards participants, it is key for
the organization to become more participant oriented.

Average In the short term, ABP is prepared to run an average risk that pension Social partners need to decide how to reflect this into
rights need to be reduced. employment terms and how to amend schemes that do
not align with the new pension contract. ABP advises
social partners on these matters but has no influence in
this.
6. We are the pension experts, including

Average ABP is prepared to run an average risk of missing out on radical Low In 2021, we invested in the “Grip on Data” program.
in pension innovation innovations that can potentially determine the long-term relevance of ABP. We will make investments in the years to come in order
to improve the participant and employer experience and

Low ABP is not prepared to run the risk of missing out on short and medium- prepare for the new contract.
term process and product innovations.

Low ABP is not prepared to run the risk of inadequate solid foundations in the
7.We have a professional Board of Trustees with very broad short and medium term. For this reason, ABP is not prepared to run short and High We work to identify past inaccuracies and gaps, and
support medium-term risks of inadequate data quality or other risks. rectify these. In 2021, the number of remedial actions
required turned out higher than previously thought. This
8.We have a grip on activities outsourced to APG
Average Average ABP is prepared to run an average risk that the construction is linked to the complexity of the pension scheme, in
drawings of the solid foundations do not anticipate every conceivable longer- particular Appendix K. Simplifications will be introduced
9.Our internal operations are in order term scenario. during the transition to the new pension contract.
Our risk management process The conclusion was that the responsible and sensible thing to do is to
accelerate the process of stopping these investments. In the implementation
For our risk management, we apply a systematic, iterative approach: the of this decision as well, we continue to carefully monitor and manage risks on
evaluation of a part of the process serves as input for the other parts of the the basis of established checks & balances.
process, so that it can be further improved. With this systematic approach, we
ensure that the risk management processes are in line with the planning and Data quality
control (P&C) processes for the in-house and outsourced activities. The quality of the data in our administration is a continuous item of attention
for Risk Management. We formulated a strategy for data quality in 2020, with
the aim of adding value to and protecting data, both now and in the future.
Key themes and focus areas in 2021 This strategy has been translated into a data compass That will support ABP in
fulfilling our short, medium, and long-term ambitions:
Sustainable and responsible investing 1. basics in order (2021-2023);
When refining our policy for sustainable and responsible investing, we also 2. improved service (2024-2030);
devoted full attention to all the associated risks: the environmental risks, the 3. future-proof service (2030 and beyond).
strategic risks, and the risks associated with our solid and ethical foundations.
We are aware that we need to step up our contribution to the climate goals. We use the data compass to actively search for missing data that ABP
At the same time, we see that the world around us is changing, and we aim to needs to ensure that every participant receives the correct pension benefit.
anticipate these changes adequately and responsibly with our investments. We have described our actions in this respect in the Insight, overview and
perspective for action subsection in the section titled Sound management of
One of the detailed analyses involved a careful assessment of the risks the pension assets.
of ceasing to invest in producers of fossil energy. Risks are assessed in
all the stages of decision-making and considered from various strategic We are aware that missing data in our administration is experienced by
perspectives, including return, social impact, and communication/support. DNB participants as an error. We take this very seriously: we are aware that this
also reminded us of the climate risk during the reporting year, which implies poses a significant risk for our support and the perception of our service. ABP
that investments in producers of fossil fuels could rapidly decline in value. and APG are working closely together in a major program to improve our
administration. We inform participants affected by our remedial actions as fully
and quickly as possible in transparent communication. Our basic principle is
that every participant should receive what they are entitled to.
NPC The coronavirus

The introduction of the new pension contract is a major and complex project. We continually monitored risks during the development of the coronavirus
Among other things, it affects our support base of participants and employers, pandemic. There were no notable items in this respect; the experiences gained
our processes, and our IT systems and data quality. Moreover, there is a legal in 2020 were sufficient to follow the safety measures without this interfering
deadline to meet: the NPC must have been implemented in 2026. ABP has with the quality of our service.
initiated a major program to ensure careful implementation, with a quarterly
risk self-assessment (RSA) as a permanent element. These RSAs will help ABP Improvements in our risk management
to identify the most important risks relating to the introduction of the NPC. Improvements were made in the short-term risk appetite in our investment
These will be closely monitored so that we can make timely adjustments policy, partly as a result of an assessment of our investments by DNB. An
where needed. action plan was also formulated to embed this risk appetite in the processes
of ABP and APG. We also consulted with DNB regarding the position of the key
The new governance model risk management officer. We will see the results of these improvements in the
The transition to a new governance model, which the Board of Trustees coming years.
resolved to adopt in the summer of 2021, means a big change to ABP’s
internal organization. The Governance section explains what will change and
our reasons for these decisions.
To identify and analyze all the potential risks of the transition to the new
model, the key risk management officer has been directly involved in both the
design and implementation of the new reversed-mixed governance model.
An administrative working group has also been formed to guide this

organizational change from a risk perspective. Attention will be permanently
focused on the risks, which relate mainly to the solid foundation, and the taking
of adequate measures to mitigate these risks.
The Board of Trustees sees the transition to the reversed-mixed governance

model as an opportunity to apply our risk principles more uniformly and
effectively under the guidance of the Executive Board and to take new steps
with respect to a number of these principles.
In Control Statement During 2021, ABP exercised risk management primarily through the
committees to which the various areas of risk management are allocated.
The In Control Statement from the Board of Trustees in 2021 is based on the Risk management within the fund is discussed by the Board of Trustees
developments and activities in the area of risk management at the fund and partly based on integrated risk reporting. The Executive Office’s responsibilities
the administrative business described above. include the independent assessment of the fund’s own risk management and
the risk management performed by the administrative business in relation
ABP's Board of Trustees is responsible for the fund's financial position and to outsourced processes. The external auditor advises ABP on the basis of
hence for the design, existence, and operation of the risk management and findings from regular audit procedures and specific audits conducted at the
control systems. The purpose of these systems is to monitor progress on request of ABP. ABP also commissions other external parties for specific audits.
attaining the strategic, operational, and financial goals of the pension fund, and The administrative business has had a comprehensive control framework of
to enable reliable financial reporting. Furthermore, these systems are designed process descriptions, checks, and test reports in place for some years to ensure
to identify and mitigate the risks that the pension fund takes and to which and maintain effective risk management. The results from the assessment of
it is exposed as a result of the environment in which it operates. The risk this control framework, including the management statements, Standard 3402
management systems also have to ensure strict compliance with relevant laws type II and Standard 3000 reports, and periodic reports, issued by the Executive
and regulations. ABP's Audit Committee periodically discussed its assessment Board and Management of the administrative business, as well as the fund's
of the design, existence, and operation of the fund's risk management and own risk management, provide the Board of Trustees with a sufficient basis for
control systems during 2021. its own In Control Statement (ICS)
The internal risk management and control systems are designed to provide a The Board of Trustees’ In Control Statement for 2021 makes an explicit
reasonable degree of assurance regarding the identification and management statement on the quality of the risk management and control systems that
of risks. The systems cannot fully guarantee that the strategic, operational and assure the fund’s financial reporting goals. The decision to focus on financial
financial objectives will actually be achieved, nor can they completely prevent reporting in the In Control Statement was partly dictated by international
all material errors and instances of fraud or non-compliance with relevant societal developments in reporting on internal risk control and the best
laws and regulations. The Board of Trustees has taken measures to mitigate practice provision of the Corporate Governance Committee II. This In Control
the impact of these stated risks as far as possible. The Board of Trustees Statement relates to the financial reporting risks regarding the 2021 financial
notes that, due to the nature of the pension fund’s activities, some risks are statements, the figures presented in the Board of Trustees’ 2021 report, and
beyond its control, such as demographic changes and developments in the the 2021 quarterly reports.
financial markets.
The Board of Trustees declares, based in part on the In Control Statement

for 2021 received from the administrative business, that the internal risk
control systems are designed to control the strategic, financial, operational,
and compliance risks relating to the achievement of ABP’s objectives.
With respect to the financial reporting risks, the Board of Trustees declares
with a reasonable degree of certainty that the performance of the risk
management and control systems in 2021 was such that the said financial
reporting products contain no material misstatements.
Contents Governance ABP Annual Report 2021 88
More decisive and

adaptable thanks
to the new
governance model
During the reporting year, we prepared for
a transition to a new governance model to
take effect on January 1, 2022. This section
describes our new governance with effect
from 2022 and as this was in 2021. We also
explain our reasons for the change, as well
as other relevant developments in relation
to our governance.
Legal structure The Board of Trustees held several theme sessions during the reporting
year in which it presented full details of these steps. During this process,
ABP was founded in 1922, with its registered office in Heerlen, the Netherlands; there has been consultation on several occasions with the stakeholders
ABP was privatized in 1996. ABP is a foundation incorporated under Dutch within and outside ABP: the Accountability Body, the Supervisory Board, the
law, in accordance with the statutory requirements for pension funds. The social partners, and the employees of ABP and APG. These consultations
foundation is registered with the Chamber of Commerce under number have contributed to ABP’s specific version of the reversed-mixed model. The
41074000. The articles of incorporation were last amended on January 1, 2022, Accountability Body has given a positive recommendation, and input from the
due to the transition to the new governance model. The pension regulations social partners has been formally obtained. ABP was assisted by an external
were last amended on November 8, 2020. The administration of the pension
scheme is placed with APG Groep N.V., of which ABP holds 92.16 percent of the
shares. ABP has been a Public Interest Entity since January 1, 2020.
Why do we need a new governance model?
Our evaluation has shown that the new reversed-mixed
De Nederlandsche Bank (DNB, the Dutch central bank) is the external
governance model will be more suitable for the challenges facing
prudential supervisor of ABP. The duty of DNB is to safeguard the stability of
ABP (see also Our environment in 2021). The advantages of the
the Dutch financial system. ABP reports to DNB on compliance with regulations
new governance model:
that promote financial soundness. The Dutch Authority for the Financial
Markets (AFM) supervises ABP’s market conduct, such as our compliance with • Clearer delineation of responsibilities will contribute to
our statutory obligation to issue pension statements. more strategic direction, faster decision making, and
greater efficiency.
• With three full-time Executive Board members, the fund and
Board of Trustees the administration provided by APG can be managed on a daily

basis. This is also important due to the introduction of the NPC.
During the reporting year, a decision was made to transition to a different • With our own version of the new governance model, we
governance model with effect from January 1, 2022: the reversed-mixed can optimally structure the social and public function of
governance model. In relation to the transition to this new model, the Board ABP as a financial institution, in which our relationship with
of Trustees has undergone an extensive process: an evaluation of existing our environment – including our social partners – is of
governance at ABP, listing the internal and external challenges that ABP will great importance.
face in the coming years, and the good governance objectives necessary to
These advantages were responsible for our decision to move to
meet these challenges. There has also been an analysis of the rationale for the
the reversed-mixed governance model; they also played a major
advantages of a new governance model.
role in the choices made with regard to its structure. With effect
from January 1, 2022, the new governance model is a reality, and
management focus is on the operation of the new model.
agency in the process leading to the decision to move to the new governance The EB is tasked with implementing the strategy and policy of ABP and is
model (on July 8, 2021). There was also regular consultation with DNB. responsible for the daily management of the fund. The various portfolios are
divided between the three members: Legal and Compliance, HR, IT, Finance,
After the summer of 2021, a transition plan was formulated by the Board of Communication and Public Affairs, and Internal Control.
Trustees to prepare thoroughly for the transition with effect from January 1,
2022. One element of this plan was the start of the Culture, Conduct, and The EB reports to the GB.
Consistency program, in which existing and new board members are prepared
for their new roles. This program will continue in 2022. Here too, ABP will be There are two committees advising the EB on the preparation of ABP’s strategy
assisted by an external agency specializing in culture and conduct by pension and policy. The Pensions Committee and the Investment Committee consist of
fund management. a combination of at least one executive and four non-executive members of the
GB. The committees have no mandate.
ABP’s governance structure from January 1, 2022
General Board of Trustees ABP’s governance structure

Effective January 1, 2022, ABP has a General Board of Trustees (GB). The GB is
responsible for developing the strategy and policy of ABP. The GB consists of
Pension Board
an Executive Board (EB) and a Non-Executive Board (NEB). The Chair of the GB,
Ms. C. Wortmann, has a bridging role between the NEB and the EB, Auditor
Actuary
ABP Management
Executive Board Board
The Executive Board (EB) was formed on January 1, 2022. It has three members:
Executive Board Key Risk Control
• Mr. H. van Wijnen, Chair; DNB AB
Officer
• Ms. Y. Verdonk-van Lokven, daily pensions management; Independent Chair
• Ms. D. Dijkhuis, daily investment management. AFM AC Non-executive Board Key Internal Audit
Officers
ABP staff
Key Actuarial
Officer
Administrative
organization (APG)
Non-Executive Board by an Audit Committee consisting of three non-executive board members and
The board members in office during 2021 transferred to the Non-Executive three external members. The key function holders will attend these meetings
Board (NEB) at the end of 2021. The NEB thus consists of 13 members, when this is considered useful.
including the Chair of the GB. In the new model, the members of the NEB have
two roles: ABP organization
• setting the strategy and policy together with the Executive Board (EB); The ABP organization is formed by the employees in the former Executive
• supervision of the GB. Office. The appointment of the EB has created a flatter organization, as a layer
of management in the form of the Executive Office MT has been removed. The
In the NEB, nine members are nominated by the social partners (employers employees of ABP now have a direct link to the members of the EB. New teams
and employees) and three by the pensioners section in the Accountability Body. will be grouped under the various portfolios of the EB members.
The Chair is appointed by the GB.
The appointment of the NEB means that the previous Supervisory Board
ceased to exist and was disbanded with effect from January 1, 2022. The
internal supervision of the fund will be performed by the NEB with effect from
2022. Among other things, the NEB will formulate a supervision plan, will hold ABP’s organization at a glance
separate and independent meetings, and will be supported in its supervision Data as at December 31, 2021
Retirement schedule Number of staff Average length of
General Board of ABP
Mr. A. Boonen
End of term
January 1, 2025
42 (41 FTE)
service in years
8
Ms. D. Dijkhuis January 1, 2026
Mr. P.J.H. Fey May 1, 2025
Ms. A. Gram June 1, 2025 Age distribution Average age
Ms. C.M. Mulder-Volkers April 1, 2023
Ms. K. Nauta March 1, 2023
Mr. P. Rosenmöller December 1, 2025 15-25 - -
Mr. A.J.M. Sibbing March 7, 2023 25-35 1 1 50 (m)
Mr. X.J. den Uyl April 1, 2023 35-45 6 3 51 (m/f)
Ms. Y. Verdonk - van Lokven February 1, 2026 45-55 7 7 52 (f)
Mr. A. van Vliet February 16, 2025 55 and over 8 9
Mr. H.J. van Wijnen January 1, 2026 Total 22 20
Ms. C.M. Wortmann-Kool January 1, 2023
ABP’s governance structure until December 31, 2021 The Executive Office was mandated by the Board of Trustees for the following
operational tasks:
During the reporting year, the fund was managed according to the equal • supervision of the administration outsourced to APG;
representation management model. In this model, the Board of Trustees • preparation of policy and decision making;
consisted of 1 independent Chair and 12 members nominated by the • communication from and about ABP.
employee and employer organizations and the pensioners section of the
Accountability Body: Membership of the Board of Trustees through December 31, 2021
• four Board members nominated by employees; The following changes took place in the membership of the Board of Trustees
• five Board members nominated by employers; during the reporting year:
• three Board members nominated by pensioners. • Ms. Mariëtte Doornekamp stepped down on October 1, 2021; the resulting
vacancy in the NEB is still open.
The Board of Trustees of ABP operated as a single team with clearly delineated • Mr. Jan van Zijl stepped down on April 9, 2021.
responsibilities and mandates, with a focus on the strategy and policy of the • Mr. Patrick Fey was reappointed for a term of four years.
fund and the daily state of affairs at the fund. During the reporting year, the • Mr. Menno Snel stepped down on September 1, 2021; this seat was still
tactical and operational tasks were mandated to the Board committees and the vacant at year-end 2021 and will, after transition to the new model, be filled
Executive Office. by Ms. Vandena van der Meer–Gangapersadsing on April 1, 2022.
• Mr. Philip Stork stepped down on January 1, 2022; the resulting vacancy in
There were no changes to the four Board committees in the old model during the NEB is still open.
the reporting year: • Ms. Anne Gram joined the Board of Trustees on June 1, 2021.
• Risk and Balance Board Committee; • Mr. Paul Rosenmöller was appointed on December 1, 2021.
• Pension Policy Board Committee (including communication and operational
risk management); The Supervisory Board (SB)
• Investment Policy Board Committee (including communication and The Supervisory Board consisted of five independent experts who supervised
operational risk management); the pension fund and the performance of the Board of Trustees. The members
• Audit Committee. were appointed by the Board of Trustees on binding nomination by the
Accountability Body. The membership of the Supervisory Board remained
These committees were responsible for preparation for decisions and meetings unchanged in 2021.
for the Board of Trustees.
Accountability body Status during the reporting year

The Accountability Body of ABP has 48 members, which applies to both the old
situation in 2021 and the new situation in 2022: Consultation
• 19 members on behalf of employees; The financial position of ABP was a continuous item of attention at meetings
• 13 members on behalf of pensioners; of the Board of Trustees. During its meetings, the Board of Trustees also
• 16 members on behalf of employers. extensively discussed the new governance model. All the parties involved were
regularly included in this process. In addition to our governance, the subject
The members are divided between various groupings. Once every four years, of sustainable and responsible investing was another important agenda item.
some members of the Accountability Body are appointed and others are The Board of Trustees discussed this in detail and took actual measures
elected in elections in which those represented can vote. The next elections in collaboration with our administrative organization in the third quarter.
will be held in 2022. Improving the quality of our data was a further important recurring item to
which the Board devoted much attention.
Each year, the Accountability Body gives its opinion on the management by
the Board of Trustees, the investment policy pursued, and policy choices for The proposed transition to the reversed-mixed governance model on January 1,
the future. This opinion is included in the Annual Report. The Accountability 2022 was also an important theme in our consultations with the Accountability
Body also advises the Board of Trustees on policy on request and on its own Body, the Supervisory Board, and the social partners in the Pension Board. We
initiative. In addition, the Accountability Body reviews whether decisions are also had lengthy discussions of the new pensions system, the financial position
balanced and in line with ABP's core values. of the fund, and refining our policy for sustainable and responsible investing.
As a first step in this refinement of our policy, the Board of Trustees decided in
One member of the Accountability Body stepped down and one new member October 2021 to no longer invest in producers of fossil fuels.
was appointed in 2021.
For important issues, we request an opinion from our Accountability Body.
Key function holders We had nine meetings with the Accountability Body in 2021, which is more
ABP had three key function holders in 2021. The key risk management officer than usual. The main reason for this was the transition to the new governance
and the key internal audit officer were positioned internally. Since July 1, 2021, model on January 1, 2022. Other requests for opinion related, among other
the key actuarial officer has been an external appointment. Since January 1, things, to the actuarial and technical business report (ABTN), the amendment
2022, the key internal audit officer has also been an external appointment. of the Regulations for the Appeals Committee of ABP, the contribution and
The key risk management officer ceased their activities on December 31, 2021. indexation memorandum, the strategic investment plan, and the strategic
Prior to a permanent appointment, this position has been filled on an interim communications plan. We consult with the Accountability Body and consider
basis since January 1, 2022. its opinion before making a final decision. We also held a number of thematic
sessions with the Accountability Body to discuss current themes such as the
development of the new pensions system and the financial structure and risk conflict between this ancillary position and the policy of ABP, Mr. Snel decided
appetite of ABP. in consultation with the Board of Trustees to step down from his position at
ABP. As a result of this situation, the Board of Trustees evaluated its own
Board presence role and existing policy regarding ancillary positions with an external party. To
Number of Participation
provide a clearer framework and prevent such situations occurring in future,
meetings rate
we decided to tighten this policy. A new policy was adopted in March 2022 that
Two-day board meeting 8 98% will come into effect in the first half of 2022. In this redefined policy, we have
including thematic sessions
among other things clearly defined our interpretation of conflicts of interest
Pension Policy Board Committee 9 97%
and situations in which a position is not compatible with a position at ABP
Investment Policy Board Committee 8 98%
for reputational reasons. The Compliance Officer is responsible for supervising
Audit Committee 8 98%
compliance with this.
Risk and Balance Sheet Committee 6 96%
Consultation meetings with the 5 98%
Accountability Body
Consultation meetings with the 8
98%
Supervisory Board
Our Board of Trustees

Diversity and inclusion
ABP believes in the value of diversity in the composition of its organization, at
is a balanced reflection
all levels. This also applies to the governance of our fund: we ensure that the
of our participants and
Board of Trustees is a balanced representation of our participants and society,
of society.
in terms of gender, age, and background in the widest sense.
We intend to update our diversity policy in the first half of 2022, with new
ambitions appropriate to our social role. The aim is to promote diversity in all
the organs of our pension fund.
Evaluation of policy on ancillary positions

A recently appointed member of the ABP Board of Trustees (Menno Snel)
accepted an ancillary position during 2021, for which ABP initially gave its
approval. Following a critical assessment made after questions and comments
from the environment of ABP, the AB, and the SB regarding the apparent
Self-evaluation and development of the Board of Trustees • Standard 25 states that each member of the Board of Trustees has a vote.
We conducted our annual self-evaluation with the full Board of Trustees in In 2021, the independent Chair of the Board of Trustees did not have a vote.
2021, with guidance from an external adviser. This involves an assessment of They will, however. have a vote with effect from January 1, 2022.
competences both collectively and individually. This produces a good picture
of the existing competences that serves as a basis for further development ABP meets the statutory requirements under the Pensions Act (Pensioenwet,
in 2022. or PW) and the PIE requirements for good governance of pension funds. There
were no instances of:
The Board of Trustees also consciously devotes time at fixed intervals to • penalties or administrative fines during the reporting year (Section
consider its development in the context of our Fitness policy. We thus comply 96(a) PW);
with the statutory requirements in DNB’s Policy Rule on Fitness. In 2022, we • instructions issued to the pensions administrator as referred to in Section
will work on team-building, effective cooperation, culture, conduct, and role 171 (Section 96(b) PW);
awareness, as we did in the reporting year. This will also include specific • a court-appointed administrator as referred to in Section 173 (Section
attention to the theme of integrity, the tone at the top, and effective safeguards 96(c) PW).
for this in the organization and in our integrity policy.
ABP has complied with the principles of the Federation of Dutch Pension
Funds’ Code of Conduct for the processing of personal data by pension funds
Compliance with statutory guidelines and codes (Gedragslijn Verwerking Persoonsgegevens Pensioenfondsen).
External compliance Additionally, a voluntary decision was made to apply the Senior Officials in
ABP is subject to the Pension Funds Code, which overlaps to some extent with the Public and Semi-Public Sector (Standards for Remuneration) Act (Wet
the Dutch Corporate Governance Code but is formulated specifically for the Normering Topinkomens, or WNT) to the Board of Trustees.
pensions sector. We comply with the standards set by this code, subject to the
following qualifications: Compliance with our internal rules
• Norm 16 states that members of the Board of Trustees, the Accountability With regard to compliance with the ABP Code of Conduct, integrity, and
Body, the internal supervision, and other co-policymakers sign the fund’s the whistle-blower scheme, no reports were made and no unusual incidents
internal code of conduct and a declaration of compliance and conduct occurred (apart from those mentioned above).
themselves accordingly. The compliance declaration attached to the ABP
Code of Conduct is signed annually by the members of the Board of
Trustees and (in 2021) by the members of the internal supervision. A
new code of conduct will be developed for members of the Accountability
Body in 2022, specifically formulated for the members. This will include a
compliance declaration.
Contents Accountability and supervision ABP Annual Report 2021 96
Accountability and supervision

Contents Report of the Supervisory Board ABP Annual Report 2021 97
Report of the
Supervisory Board
We hereby present the report of the
Supervisory Board for 2021. This year was
not only an extraordinary year, it also
brought a period of supervision of almost
eight years to a close. Our supervisory duties
began on July 1, 2014, with the introduction
of the Pension Fund Governance Act (Wet
versterking bestuur pensioenfondsen).
With effect from January 1, 2022, after
the transition to a new governance
model, internal supervision will be the
responsibility of the Non-Executive Board
(NEB). This brings our role to an end, and our
activities ceased on December 31, 2021.
To give account of our activities during the past year as transparently as Procedure of the Supervisory Board
possible, the Board has decided to include our accountability report in this
annual report. This does not constitute an opinion on our part regarding the The Code of the Dutch Pension Funds and the Association of Internal
annual report: this is reserved for the NEB. Pensions Sector Supervisors (Vereniging Intern Toezichthouders
Pensioensector, or VITP) as underlying principles
The Board presented its final report to the Board of Trustees at a consultation The Supervisory Board advises the Board of Trustees both on request and
meeting on January 10, 2022. We discussed our report with the Accountability on its own initiative and supervises the policy of the Board of Trustees, the
Body on January 13, 2022. We also gave account of our activities to the adequacy of the risk management, and the balanced consideration of interests
Accountability Body on this date. by the Board of Trustees. The duties of the Board are established in the
fund’s Articles of Incorporation, with further details of how these duties are
We wish to express our appreciation to the Board of Trustees and the to be performed in the Supervisory Board regulations. The performance of our
Accountability Body for the cooperation over the past years. duties is based on the Code of the Dutch Pension Funds, which states that
internal supervision should contribute to the effective and efficient functioning
of the fund and a controlled and ethical business operation.
Brief review
The following principles of the Code of the Association of Internal Pensions
2021 was the year in which the Board of Trustees decided to move to a Sector Supervisors (hereinafter: VITP) are relevant for the Board:
new governance model with effect from January 1, 2022. This was therefore 1. Protection of the participants' pensions is the priority for supervision.
also an important agenda item for us. We fulfilled our supervisory role by 2. The Supervisory Board is aware of its responsibilities and conducts
monitoring progress, acting as a sounding board for the Board of Trustees, itself accordingly.
and questioning the Board of Trustees with respect to key decisions on the 3. The individual supervisory directors are responsible for their fitness and the
path to the new governance model. The decisions by the Board of Trustees effectiveness of their performance.
regarding the structure of the governance model will indeed significantly affect 4. The supervisory directors render account and are accountable for
the future of the fund and the confidence of participants in ABP. There were their supervision.
additionally regular agenda items for the Board, such as the new pension
contract (hereinafter: NPC), sustainable and responsible investing, and the Annual Report 2021
fund’s financial position. The Board ceased its activities on January 1, 2022: with effect from January 1,
2022, internal supervision is provided by the Non-Executive Board. This report
is therefore limited to findings up to the end of 2021. The Supervisory Board
has had no further role in the approval of the annual report for 2021.
Meetings in 2021 Prior to each consultation with the Board of Trustees, the Board met separately
Due to the measures in connection with the coronavirus, most of the meetings to prepare for these meetings and exchange thoughts on observations and
in 2021 were held remotely. findings with respect to the supervisory agenda for 2021.
Meetings with the Board of Trustees and the Executive Office There were also periodic consultations between the (vice) chairs of the Board
Eleven meetings were held with the Board of Trustees. The most important of Trustees and the Supervisory Board, as well as regular discussions between
items for discussion with the Board of Trustees were the transition from the Chair of the Supervisory Board and the Chair of the Board of Trustees on
the current equal representation governance model to a reversed-mixed management performance.
governance model on January 1, 2022, the fund’s financial position, and
preparations for the implementation of the NPC. Dynamics at the Board table
We learn of the Board of Trustees’ activities from the dialog with the Board of
As part of the supervisory agenda for 2021, the key risk, audit, and Trustees and from minutes and quarterly reports. Members of the Supervisory
actuarial officers attended a separate Board meeting for further discussion of Board also attend Board of Trustees’ committee meetings in the roll of
their findings. observer, which has given us an understanding of the dynamics at the Board
table. The Supervisory Board has access to all information and receives
The NPC is one of our most important strategic supervisory themes. Through additional information from the Board of Trustees on request.
December 31, 2021, a delegation from the Board (based on the items to be
discussed) held four extra meetings with the Board of Trustees, the program Meetings with the Accountability Body
director, and the program manager of the Executive Office to prepare for Four meetings were held with the Accountability Body through December 31,
the consultative meetings between the full Supervisory Board and the Board 2021. The items discussed concerned mainly the change to the governance
of Trustees. model, the accountability report of the Board for 2020, the regular activities of
the Board in relation to its supervisory agenda for 2021, the financial position
There was also one strategy meeting held with the Board of Trustees, featuring of the fund, and preparations for the implementation of the NPC.
a reflective discussion of the decision to transition to the new governance
model in January 2022. This discussion also encompassed sustainable and Members of the Supervisory Board attended many of the Board of Trustees
responsible investing, with attention to the decision to cease investments in meetings with the Accountability Body in 2020 in the role of observer to
producers of fossil fuels. gain an understanding of the dynamics between the Board of Trustees and
Accountability Body.
Meetings with other stakeholders was thorough, there was attention to input from the social partners, and the
The Supervisory Board also met with the external regulator, DNB, on three Accountability Body was involved in an attentive manner.
occasions through December 31. Lastly, one meeting was held with the (new)
CEO of the Executive Board of APG. During the past period, we have (among other things) called for sufficient
attention to cultural and conduct-related aspects within the Board of Trustees,
Separate meetings for disclosure of whether other potential solutions have been considered (and
We held 21 separate meetings through December 31, 2021. why these would not lead to the necessary improvement), for a thorough
risk analysis to be made, and for explicit consideration to be given to the
Own development and self-evaluation consequences of the fact that, with the RMGM, the internal supervision will be
Several seminars and training courses were held in relation to the Board’s own less independent.
development during the reporting year. The Board also had discussions with
an external expert regarding the new pensions agreement and communication We wish to express our appreciation to the Board of Trustees for the
to participants in early 2021. This in-depth discussion focused on lessons from constructive discussions on this issue.
other countries regarding the introduction of contribution agreements and
methods of communication to raise participant engagement. We support the decision of the Board of Trustees to move to the RMGM
with effect from January 1, 2022. The Board sees the RMGM as an important
driver of the necessary changes and further progress in professionalization
The new governance model and effectiveness.
In the recent period, we met with the Board of Trustees to discuss the study The Board sees the transition to the RMGM as a first step within a long-term
by the Board of Trustees regarding the transition from the current equal perspective. Our considerations for the short and longer term:
representation governance model to a reversed-mixed governance model
(hereinafter: RMGM) with effect from January 1, 2022. The Board of Trustees Need for further professionalization and greater efficiency
expects this new model to present an opportunity to manage ABP more A smaller team of full-time Executive Board members selected on the basis
efficiently and effectively in a period when there will be significant challenges, of expertise and competences will enable a more professional and efficient
such as the transition to a new pension contract. development of policy and outsourcing relationship with APG.
We have been closely involved in the process leading up to this decision and The new pensions system
have reflected on the justification and development of the new governance The transition to a new pensions system based on a contribution agreement
model both in our regular meetings between the Board of Trustees and and further transfer of risk onto the participants will mean different
the Supervisory Board (hereinafter: SB) and in various working groups. Our requirements and accents: fewer issues related to contributions and
general findings regarding the process followed are positive. The preparation obligations, greater focus on asset management, service to participants, and
outsourcing. An organization that is oriented more towards participants is Job profiles

thus essential. One of the most important supervisory duties involves the assessment of the
professionalism of directors. The SB takes advice on and approves job profiles
Role of the social partners in governance for new directors.
The social partners have a decisive role in the establishment of the scheme
(Pension Board). Their role in the administration (management) will naturally During the reporting year, we approved the profiles for the Executive Board,
become less because of the nature of a contribution agreement, and in the the Non-Executive Board, and the competences for the Board’s Investments
long run could be reduced to its essentials: the connection with the sector and and Pensions Committees.
monitoring the consideration of interests.
The SB asked the Board of Trustees to search for an Executive Board that is
Participant confidence able to give form and content to the structural change, so that the fund and
At this moment in time, participant orientation and participant interests are its administrative organization are optimally aligned. This is a key first step
becoming increasingly important. We believe that this can still be more clearly in taking the outsourcing relationship with APG to a higher level. In relation
demonstrated by the ‘tone at the top’ and ‘walk the talk’: social awareness to the interests of participants, we also requested the Board of Trustees to
among the directors, participant orientation, and transparency can contribute look for people with a strong affinity for connection within a complex group of
to participants having confidence in their pension. stakeholders, in which the social context of the participants is given priority. We
also considered whether three Executive Board members are adequate, given
Size and composition of the Board the size of the organization.
We think that the new governance model could be more effective with a
smaller General Board (GB), particularly with fewer non-executive directors. The SB took further note of the job profiles for the Non-Executive Board
Our advice to the Board is to prepare detailed plans for reducing the size of and the competences required for the Pensions, Investment, and Audit
the Board, or to include the size of the GB and the ratio of executive and Committees. We advised the Board of Trustees to clearly separate the
non-executive directors in the evaluation. supervisory role and the role of directors (in the General Board) and to set high
standards for the expertise required for members of the Non-Executive Board.
An effective outsourcing relationship We additionally requested the Board of Trustees to make communication and
It is important that the direction of professionalization, efficiency, and risk management an integral part of policy preparation in the Investment and
customer orientation is continued. In this context, the SB advises that sufficient Pensions Committees.
attention be paid to the relationship with APG, the management of mutual
expectations, and a clear delineation of roles. We are of the opinion that the Board of Trustees has adequately responded to
Based on our duty under the law and the Articles of Incorporation, the Board our suggestions and paid careful attention to the profiles and the competences
devoted particular attention to the following themes. of the Board committee members.
Appointments to the General Board Good and independent internal supervision

Since January 1, 2022, the General Board of ABP has consisted of 3 executive With the RMGM, there will no longer be a Supervisory Board. The non-executive
directors and 12 non-executive directors, led by an independent Chair. By directors will be responsible for internal supervision, supported by an Audit
December 31, 2021, we had approved the appointment of the executive Committee. This has been conscientiously developed by the Board of Trustees;
directors Mr. Van Wijnen, Ms. Verdonk, and Ms. Dijkhuis. The main focus of many of the observations of the SB have been included by the Board of
our assessment was whether the team as a whole possessed the necessary Trustees in this development.
knowledge and competences.
One feature of the model in the SB’s view is that, in the RMGM, internal
The directors Ms. Gram and Mr. Rosenmöller were also appointed during supervision will be less independent than under the equal representation
the reporting year, having been assessed on the competences required model. This is a disadvantage, which is offset by other benefits. The Non-
in anticipation of the introduction of the new governance model. Mr. Fey Executive Board is less independent and also less distanced than a Supervisory
was reappointed. Board with external members that are not delegated via the social partners.
We note that the Board of Trustees is aware of this issue and that it has paid
Culture and conduct attention to including checks & balances to ensure an external perspective.
In itself, a structural change does not ensure success in making the
management of ABP more efficient and effective. The SB believes that the One point on which the SB is not on the same wavelength as the Board of
difference in daily activity has to be made in the interests of the participants, Trustees is the decision that the independent Chair of the General Board also
mainly by a change in the tone at the top. Senior management has to set an chairs the Audit Committee. We see good reasons for not assigning both these
example and display exemplary conduct. This requires readiness to call others positions to one person. The combination of positions in the current version of
to account and to be called to account. the RMGM does not ensure maximum effectiveness of the checks & balances
and the availability of countervailing power.
In view of the changed roles, and given the fact that many existing directors
will sit in the new RMGM, albeit in different roles, the SB recommends use Risks
of an independent and strong boardroom coach, development of clear and During the preparations for the transition to the new governance model, the SB
measurable evaluation criteria and clear setting of mandates in this process. advised the Board of Trustees that it was important to remain outward-looking.
We also stressed that APG should be involved in the change. Our advice is
to continue to devote attention to this during the implementation and the
first phase.
Positioning of the key risk management officer the goals (in the short, medium and long term) to which this change has to
During the reporting year, we discussed the positioning of the key risk contribute. The transition to the RMGM is after all not an objective in itself.
management officer in the RMGM both with the Board of Trustees and with The Board of Trustees has formulated such criteria and informed the SB in
DNB. The Board of Trustees has chosen to position the key risk management this regard.
officer alongside the Executive Board and to attend meetings of the Executive
Board in this capacity. The key risk management officer also attends meetings The SB sees the criteria as a good first step towards monitoring and evaluating
of the General Board and the Non-Executive Board. the operation of the RMGM. The criteria are not only suitable for establishing
how the Board is developing, as they can also help to set the direction of the
In this discussion, we stated that independence in the positioning of the change. The SB advises the Board to focus the criteria more on the essence of
key risk management officer, the competences of the key risk management the intended change, namely:
officer in the new setting, and a risk-aware culture in the Board are of • the Board’s effectiveness – fewer meetings, shorter processing times,
crucial importance. alignment of agendas, degree of delegation;
• maintaining connection with and consideration of the changing wishes of
Remuneration policy the client (both employers and participants);
The introduction of the RMGM was a reason to review the remuneration policy • effective and efficient focus on the essential chain: from a euro of
of the senior management. The Senior Officials in the Public and Semi-Public contribution to a euro of pension, for which all those involved, including
Sector (Standards for Remuneration) Act is the basis for the remuneration the fund and APG, need to meet their responsibilities;
policy of ABP. The remuneration of the non-executive directors and the • a learning organization – readiness on the part of directors to continue
independent Chair is based on 95 percent of the WNT standard. For the permanent development and keep the fund fit and proper for the future;
members of the Executive Board, the WNT standard is the maximum. The SB • the employee’s perspective, including focused development trajectories and
sees the WNT as a good starting point, as a balance is sought between retaining satisfaction surveys, for example.
the necessary quality and experience in the fund and consideration of the
fund’s social role, which in our view should be reflected in the remuneration. Conclusion
The SB supports the steps the Board wishes to take in improving the goals
The transition of good governance: the realization of more effective management of internal
The SB is of the opinion that the Board of Trustees has designed a careful operations and an effective outsourcing relationship with APG. The Board of
procedure for achieving the transition to the RMGM. We see the transition to Trustees has thoroughly considered and prepared for the transition to a new
the RMGM as a development for the longer term. The first step has now been governance model. The SB wishes to stress again that the new governance
taken. The Board needs to be aware of this and act accordingly. model is a means to an end and not an end in itself and expresses the desire
that this will provide the required impulse for the achievement of strategic
We have also challenged the Board of Trustees to develop good and goals and solutions to problems.
measurable criteria for the introduction and operation of the RMGM and for
Other findings which the risk was in line with the current and expected direction of the NPC
with the Board of Trustees. This led to the following findings:
Financial risk appetite • The SB observed that the Board of Trustees had followed a diligent process
The SB has discussed the findings and insights from the Participant Risk in the amendment to the interest-rate hedge, involving both the risk
Appetite pilot study with the Board of Trustees. The study was a first step perspective for the various participant groups and the current and expected
towards a large-scale survey of participants’ risk appetite, with a view to direction of the new pension contract.
meeting the requirements of the NPC. Under the NPC, pension funds will have • The SB noted that, in the reassessment of the risk of the strategic
to periodically assess their participants’ risk appetite. This was the direct reason investment mix (percentage of marketable securities), the outlook for
for the Participant Risk Appetite pilot study. The Board of Trustees stresses that participants had not been adequately developed for the various participant
the risk appetite of participants cannot be uniformly established and cannot groups and recorded in the consideration. Process agreements between
be translated directly into policy. In the discussions with the Board of Trustees, the Board of Trustees and the SB were made on this point. The survey of
there was particular attention to the finding that the degree of risk appetite participant risk appetite had produced additional information for a proper
among participants in the study was widely varied. We questioned the Board of assessment, and we advised the Board of Trustees to use this information
Trustees about the potential consequences that it was considering. in the run-up to the new contract.
• The Board of Trustees has formulated an action plan that includes follow-up
The SB noted that the findings of the participant study should be seen as on the findings of the investment review by DNB. Among other things, this
important input for both asset allocation and the final or provisional choice includes attention to the demonstrable consideration of the response of
of the contract. In view of the wide diversity of ABP participants (including the organs of the fund in establishing the short-term risk appetite. The SB
in terms of salary and education), the SB considers it useful to pay explicit approves of this action plan.
attention to potential differences in risk appetite and the question of whether
the ‘solidary contract’ version of the NPC is the most suitable from the point Contribution policy
of view of the participants’ interests. Clearly, this has to happen while taking The SB has evaluated the contribution policy on the basis of a balanced
account of the delineation of responsibilities for the social partners and the consideration of interests. We noted that the Board of Trustees has assumed a
Board of Trustees. multi-year development of contributions in which the discount rate is gradually
reduced. The most important decisions of the Board of Trustees concerned
The SB has issued a statement on the financial risk appetite of ABP, partly the retention of the recovery mark-up of 1.5 percent and the equalization
as a result of the ALM study conducted in 2021. The financial risk appetite of the contribution over two years. For the equalization of the contribution,
consists of a short-term and a long-term risk appetite. We called for follow-up consideration was given to the options of phasing over two or four years. The
to previously asked questions on the short-term risk appetite, in particular SB also took note of the negative opinion from the Accountability Body and the
for explanation of the short-term risks for various groups of participants and response to this from the Board of Trustees. We are of the opinion that the
discussion with the organs of the fund. The SB also discussed the extent to Board of Trustees carefully considered the interests involved. The SB made the
point that there should be a review of the process followed with both the social
partners and the Accountability Body, with the central question being whether However, this is no guarantee that the errors will be remedied in good time so
the perceived difficulties could be identified at an earlier stage in future. that conversion to the NPC can be effected with a clean database. The SB has
urged the Board of Trustees of ABP to devote adequate attention to this issue
Strategy in its communication with participants, so that any future adjustments do not
An important change was completed on January 1, 2022 with the design of the come as a surprise.
governance model: the transition from an equal representation model to the
reversed-mixed model. We have addressed this elsewhere in this report. The One major cause of errors in the data is the complexity of the scheme.
Board of Trustees believes that this structure will enable it to be more effective
in the realization of its strategy. Much time was devoted to this change in the Simplifying the pension scheme is still an intractable problem, because many
past year. There was also attention to important strategic themes, including: parties have to be brought together for this and because simplifications need
• the introduction of the new pension contract; to be supported. The SB notes that the Board of Trustees is aware of the need
• the management of the outsourcing agreement with APG; for simplification and at the same time recognizes that the options for the
• continued alignment with relevant social themes; Board of Trustees are limited, as this is a decision for the social partners.
• establishing the intended level of service to participants;
• serving the long-term and other interests of all participants. DNB conducted an on-site review of the management of data quality at the end
of 2021. The findings of this review were not known at the time of producing
These are all issues that will continue into 2022 and beyond. The SB wishes the this report. One member of the SB was also interviewed by DNB. Items of
new directors and the previous directors success in their new roles and hopes attention mentioned by the SB to the Board of Trustees and DNB concerned
that they will quickly adapt to their new relationships and that all their energy finding a proper balance between incident-driven and risk-based monitoring
can be directed at these and other relevant themes. in the Grip on Data project at APG, the management of expectations among
participants regarding potential financial consequences of error remediation,
Administration of the pension scheme and continuous process monitoring on a constructive dialog with APG on
There was increased attention to improving data quality at APG this year, in progress and escalation.
preparation for the NPC. The Board of Trustees followed this process in its
monitoring capacity as the client of APG. A large-scale program is running
at APG designed to identify and remedy errors in the administration. Not all
identified errors have financial consequences for the participants, but some do.
The SB discussed this program with the Executive Board of APG in 2021 and
noted that work on remedying errors was proceeding with due priority and in
adequate detail.
Sustainable and responsible investing • The Board of Trustees stated that it had taken this decision as part of
The SB discussed sustainable and responsible investing with the Board of its strategic investment policy, as the decision concerned a refinement
Trustees a number of times during the year. The Board of Trustees announced of the inclusion criteria within existing policy. For this reason, the Board
in 2021 that it was intending to refine its policy for sustainable and responsible of Trustees did not consider an opinion from the Accountability Body
investing and also stated that the implementation of its policy was not and/or consultation with the SB to be necessary. We think there are good
sufficiently in line with expectations. Support for the policy among participants arguments for considering this decision to be a change to the strategic
and employers also declined during the year. The SB endorsed the need and investment policy, given the impact and nature of the decision.
urgency of refinement. • The Board of Trustees stated that it would be able to invest in energy
producers again if they cease to explore new sources and invest more in
As a first step, the Board of Trustees decided in October 2021 to no longer new sources of energy. The inclusion criterion is actually more qualified
invest in producers of fossil fuels. This decision was based on academic than a ban on investment in producers of fossil-based energy. We take the
publications from reputable institutions showing that the global reduction of view that this was not adequately explained in the communication of the
CO2 emissions was not happening fast enough. The decision was reached in a decision and warn against raising unjustified expectations in this respect.
period of continuing pressure from groups of participants and employers and
the threat of a court case against ABP. The SB and the Accountability Body were New pension contract (NPC)
not consulted with respect to the proposed change in the investment policy. The NPC was clearly a priority in the SB’s supervision in the reporting year:
We did, however, assess the process followed in our supervisory capacity there was a Pension Accord, the outlines of the legislation were formulated,
and reached the following observations and conclusions without coming to an and preparation for the transition had to begin. The NPC is of huge importance
opinion regarding the outcome of this decision: for pensions in the future and for the confidence or restoration of confidence
• The SB notes that the entire Board of Trustees has devoted much time to among the participants.
understanding the climate issue and the various options for refining the
investment policy. Various proposals were explored and discussed in depth. We organized consultation meetings with the Board of Trustees, carried out
• On request, the Board of Trustees provided the SB with a written our own in-depth research, and held thematic sessions with the Board of
explanation of its reasons for the decision and the deliberations of the Trustees in line with the planning. An additional session to deal with pressing
various alternatives by the Board of Trustees. This memorandum from the issues was held with members of the Board of Trustees and the Executive
Board of Trustees described the intense administrative process. The SB Office. The SB believes that, with its NPC program and Clear Future and Ready
established that the standard procedure had not been followed during the for Tomorrow projects, the Board of Trustees has designed a diligent process
final accelerated phase and that it could not follow the documentation on for achieving the transition to the NPC.
certain points. Our remaining questions were adequately answered by the
Board of Trustees. We discussed items of attention in this process with
the Board of Trustees and advised the Board of Trustees to evaluate the
accelerated process.
This transition will continue for at least five years. Virtually all the important will be made available for the needs of ABP. The SB has been informed that
aspects, conditions, and considerations for a pension fund will be affected: the APG is preparing a new action plan and will share this with the Board of
financial structure, risk appetite, risk management, data quality, simplification, Trustees in early 2022. The Board of Trustees has made simplifications where
business operation, and communication. The SB advises the Board of Trustees possible, without involving the individual schemes. It also wishes to avoid new
to continue to devote attention to restoring confidence throughout this period complications with respect to the transition. The Board of Trustees is currently
of preparation and transition. treating this as input and a condition for introduction. The SB notes that the
Board of Trustees has, for example, not succeeded (not even partially) in
The SB had agreed with the Board of Trustees to specifically discuss the issues resolving the transition measures issue in Appendix K, without the pressure
of communication, migration, introduction, and simplification. that introduction will bring. The Board of Trustees explained to the SB that
resolving this issue cannot be straightforward, due to the individual approvals
With regard to communication, the SB wished to know whether the Board that are needed. The SB notes that the Board of Trustees wishes to find a
of Trustees had formulated a clear communication strategy with a long-term solution in the entirety of the changes in the transition to the NPC. Then it
perspective. According to the Board of Trustees, there were still too many will be possible to consider interests and search for a balance. But even if the
uncertainties at this point to issue communication about a new ABP contract. transition were not to go ahead, the SB takes the view that the simplification
If the situation becomes clearer in 2023, the Board will communicate with of the scheme or the improvement of the administration and data still has
the stakeholders regarding the new contract. The SB understands the need to happen, for reasons of explainability, manageability, and prevention of
for this phasing and has called for attention to managing expectations given errors in the administration. These three aspects are not only conditions for
such phasing. a transition, they are also an aim in itself, whichever scheme is concerned.
The SB recommends that the issue of explainability should continue to be At the time of completion of this report, there was still no management
raised during the entire process. Explainability is essential for participants to decision regarding the introduction. The outline of the process could be
have confidence in their pension and their fund. presented to the SB, but without details. The process embarked upon does
inspire confidence.
Regarding the transition to the NPC, the Board of Trustees has informed
us of the efforts made by ABP and APG to prepare for this properly. Data In addition to the specific themes mentioned above, in this context, the SB
quality is a significant consideration. The Board of Trustees has shared its focused mainly on balance, participant orientation, and risk control.
process, deliberations, and dilemmas with the SB. We were impressed by the
commitment and effort needed for Grip on Data and to achieve the deadline The issue of balance prompted us to request further explanation from the
of January 1, 2023. This is not only important for the future migration, it also Board of Trustees regarding the fact that the Board of Trustees was using
affects the current administration and issues that need to be addressed. The an ‘NPC working hypothesis’ at this stage, which is based on what, at this
SB shares the concern of the Board of Trustees regarding timely completion of point, is referred to as the solidary contribution contract. The SB wished to
getting the administration and data into shape and whether sufficient capacity know on what basis the Board of Trustees had made this choice and whether
other options could still be possible. In an extra session with Board members, The positioning of the key risk management officer did not lead to any
program management, and members of the SB, it was made clear to us comments from the SB. In the prelude to the new governance structure, we
that the Pension Board had chosen this working hypothesis, with substantive were involved in the related positioning of the key risk management officer.
support from the Executive Office of ABP. This was approved by the SB.
Interim checks on the basis of guiding principles have been agreed for The Board of Trustees discussed the integrity policy in a thematic session
the evaluation by the Board of Trustees required in the acceptance of the during the reporting year. The Board of Trustees had not yet reached definitive
assignment in order to avoid a situation in which testing can only be made conclusions at the time of preparation of this report. The Board of Trustees
ex-post in the process. These principles should give the Board of Trustees a also tightened the policy on ancillary positions on the basis of an external
basis. The provisional choice in the form of working hypotheses will continue to evaluation. We had recommended that the external perspective should be
be tested during the process. This testing may, as the SB has been assured on ensured in the annual evaluation process. We also endorse the improvement
request, lead to changes. of process agreements, but we informed the Board of Trustees that we see
structure and process solely as preconditions. In the SB’s view, the solution
We advise the Board of Trustees to keep an open view of apparently unlikely lies in a more central priority for culture and conduct. The issues relating
scenarios, such as the pension transition not happening, at least not in the to conduct and culture in our view have wider implications than solely the
currently expected form. policy on ancillary positions. The Board of Trustees has accepted this in its
discussions with the SB and has stated that it intends to include this in the
Controlled and ethical business operation/risk management coaching process. Culture and conduct were also mentioned in the discussions
On the introduction of IORP II, the Board of Trustees chose to position the key of the structure of risk management, and there are also implications for the
officers as employees of the Executive Office. In the case of the key audit officer review of the integrity policy. The SB sees this as an opportunity for introducing
and the key actuarial officer, the SB considered this to be an unfortunate new measures in the new governance model.
combination of tasks and responsibilities. We have reported on this issue
previously. From reports and discussions, there have never been any cases The Pension Funds Code
in which the combination of tasks and responsibilities has caused problems. Whereas we usually look beyond the end of the year in this report, the SB can
Nonetheless, we are pleased that both these key officer positions have been no longer give its opinion regarding relevant developments after the closing
assigned to new officers that have no other responsibilities within ABP. date. From January 1, 2022, the internal supervision will be provided by the
Non-Executive Board and our activities will come to an end. As far as we are
aware, ABP did not comply with one element of the Pension Funds Code in
2021, namely the lack of a voting right for the independent Chair.
In conclusion
At the end of nearly eight years of supervision, the SB looks back on a period
in which ABP was frequently the subject of public scrutiny and was faced with
specific challenges.
The SB has been able to conduct its supervisory duties in sound mutual trust,
always based on the strength of arguments and an evaluation of the quality of
the decision-making process.
We thank the Board of Trustees and the Accountability Body for their
cooperation over the years and wish them both great success in their work
for the fund, in the interest of a good pension for the participants.
The Supervisory Board,

Huub Hannen, Chair
Kitty Roozemond
Peter de Groot
Nicolette Loonen
Anneke van der Meer
Contents Report of the Accountability Body ABP Annual Report 2021 110
Report of the
Accountability Body
This report gives further details of how the
Accountability Body performed its duties
and exercised its powers in 2021. Firstly, we
describe the duties and composition of the
Accountability Body, followed by an account
of the frequency of our meetings during
the reporting year. We then turn to the
items discussed during the year, involving (in
order) requests for opinion, other items, our
opinion of the performance of the Board of
Trustees in 2020, and thematic meetings.
Duties and powers of the Accountability Body The Accountability Body nominates members of the
Supervisory Board.
ABP is statutorily required to appoint an Accountability Body. The duties and Members of the Supervisory Board are also appointed or reappointed
powers of the Accountability Body are established in the Pensions Act, the on binding nomination by the entire Accountability Body. There were no
Articles of Incorporation of ABP, and the Accountability Body’s own regulations. appointments or reappointments in the reporting year. The activities of the
Supervisory Board ceased on January 1, 2022. With effect from January 1, 2022,
The duty of the Accountability Body is to submit opinions to the Board of after the transition from the equal representation model to the reversed-mixed
Trustees either on request or on its own initiative. The Articles of Incorporation model, internal supervision is the responsibility of the Non-Executive Board
of the Stichting Pensioenfonds ABP state that an opinion must be requested for (NEB). As part of the arrangement for the transition, the Accountability Body
at least the following topics: will make one binding nomination for the appointment of one of the external
• the adoption and amendment of: members of the Audit Committee.
• the communication and information policy;
• the contribution and indexation memorandum; The Accountability Body assesses the policy pursued by the Board of
• the strategic investment policy; Trustees once a year
• the Actuarial and Technical Business Report (ABTN); The Board of Trustees gives account to the Accountability Body on the policy
• the strategic multiyear plan; of ABP for the future and how policy has been carried out during the past
• the recovery plan; year. This account is given by means of the annual report, the financial
• refunds of contributions or grants of contribution discounts; statements, and other important information. As part of the annual process,
• entering into, amendment, or termination of the administration the Accountability Body also meets once a year with the compliance officer, the
agreement(s) with the administrative organization(s); external auditor, the external actuary, and the key officers.
• amendment of the Articles of Incorporation and the regulations for the
organs of ABP (other than the pension regulations). The Accountability Body uses these discussions and this information to form an
opinion regarding the policy of the Board of Trustees.
The representatives of the pensioners may nominate three
Board members.
These persons join the Board of Trustees on behalf of the pensioners. The The Accountability Body is made up as follows:
Board of Trustees appoints these persons according to the rules in the Articles
of Incorporation. There were no appointments or reappointments in the ABP's Accountability Body has 48 members, divided into three groups: 18
reporting year. In September, however, the pensioners representatives began members representing the participants, 14 representing the pensioners, and
with recruitment and selection in relation to the successor to Mr. Stork with 16 representing the employers.
effect from January 1, 2022. This procedure was not yet complete at the time of
preparation of this report.
Division of seats since July 1, 2021 The Accountability Body includes six groups working on the basis of their own
vision and ambition: FNV/ACOP, LvOP, CNV/CCOOP, CMHF/AC/FOG-ABP/NBP,
ANBO, Employers.
FNV (ACOP): 11
23%
In the committees, in which all groups are represented as far as possible,
Employer
representatives: 16 preparations are made for the meetings of the Accountability Body with the
33%
Board of Trustees. The committees then advise the Accountability Body on the
positions to be taken. The committees do not have decision-making powers.
Meetings with the Board of Trustees

CMHF/AC/FOG-ABP/ In 2021, 12 meetings were held with the Board of Trustees. The main items of
NBP: 7
15% discussion were the transition from the current equal representation model to
the reversed-mixed governance model with effect from January 1, 2022 and the
LvOP: 5
10% requests for opinion. The Board of Trustees also held a number of thematic
ANBO: 2 CNV (CCOOP): 7
4%
sessions with the Accountability Body to discuss current themes such as the
15%
development of the new pensions system and the financial structure and risk
appetite of ABP.
Meetings during the reporting year Meetings with the Supervisory Board
Four meetings were held with the Supervisory Board through December 31,
Meetings in 2021 2021. The Supervisory Board renders account for its internal supervision to
Due to the measures in connection with the coronavirus, most of the meetings the Accountability Body. The Accountability Body also has dialog with the
in 2021 were held remotely. Supervisory Board in preparation for the adoption of its findings and its
opinion on the Board of Trustees’ policy. The items discussed concerned
Separate meetings mainly the change to the governance model, the accountability report of the
The Accountability Body met separately on 17 occasions in 2021. SB for 2020, the regular activities of the SB in relation to its supervisory
agenda for 2021, the financial position of the fund, and preparations for the
Committee and group meetings implementation of the new pension contract.
The separate meetings of the Accountability Body were usually preceded by
meetings of the various groups and committees. The Accountability Body has
four committees, the Finance Committee, the Communication Committee, the
Investment Committee, and the General Committee.
The internal supervision will change with the transition from the equal The Accountability Body also called for sufficient attention to be paid to cultural
representation model to the reversed-mixed governance model. In practical and conduct aspects within the Board of Trustees, members of the General
terms, this means that the Supervisory Board ceased its activities on December Board’s role awareness, which will also involve a supervisory role in the NEB,
31, 2021. In view of this, the SB completed its Report of Findings for 2021 at the justification of the remuneration policy, and the development of good and
end of 2021. This report was discussed with the Accountability Body and the SB independent internal supervision.
on January 13, 2022. After this discussion, the SB ceased its activities.
Adjustments were made to the model following several extensive discussions
between the Board of Trustees and the Accountability Body. This led, among
Requests for opinion other things, to the Accountability Body being given advisory rights with respect
to 1) the Regulations for the Audit Committee and the Board, 2) the general
The Accountability Body advises the Board of Trustees. The following requests profiles of members of the Executive Board and the Non-Executive Board,
for an opinion were made in the reporting year: and 3) the profiles of the external members of the Audit Committee. It was
additionally agreed that the Audit Committee (in addition to the three NEB
Request for opinion on new governance model with effect from members) will consist of three external members; one of the three external
January 1, 2022 members of the Audit Committee will in the first three-year term be appointed
The Accountability Body discussed the studies relating to the transition from on the binding nomination of the Accountability Body. The Non-Executive
the equal representation model to the reversed-mixed governance model Board will also be additionally supported by the Audit Committee when taking
(hereinafter: RMGM) with effect from January 1, 2022 with the Board of important decisions. Furthermore, the Chair of the Accountability Body will
Trustees on several occasions during 2021. The Board of Trustees expects be involved in the recruitment and selection of the independent Chair of
this new model to present an opportunity to manage ABP more efficiently the General Board and will be a member of the selection committee. It was
and effectively in a period when there will be significant challenges, such also agreed that the remuneration policy will take the Senior Officials in the
as the transition to a new pension contract. The Accountability Body was Public and Semi-Public Sector (Standards for Remuneration) Act (WNT), as the
closely involved in the process prior to the decision being made. During this maximum remuneration.
period, the Accountability Body asked (among other things) whether a change
of model would be a solution to the identified issues and whether other All these changes to the model led to a positive opinion from the Accountability
potential solutions were being considered (and why these would not lead to the Body, with 27 votes in favor, 21 against, and no abstentions.
necessary improvement), for a thorough risk analysis to be made and explicit
consideration to be given to the consequences of the fact that with the RMGM,
the internal supervision will be less independent.
Request for opinion on amended fund documents Request for opinion on the recovery plan
In connection with the decision to move to the RMGM with effect from January By law, pension funds must submit a recovery plan if their policy funding ratio
1, 2022, several fund documents have been amended or drafted for which is too low. At year-end 2020, ABP’s policy funding ratio should have been higher
the Accountability Body has the right to express an opinion. The documents than 125.8 percent, but at that time, this was lower than the required funding
concerned were: ratio. ABP accordingly prepared a new recovery plan and submitted this to the
• the Articles of Incorporation; Accountability Body for an opinion.
• the Board Regulations;
• the Audit Committee Regulations; The Accountability Body issued a favorable opinion on the recovery plan in
• the general profile for external members of the Audit Committee. March 2021. A minority of the Accountability Body abstained from giving
an opinion.
After various textual and substantive changes by the Accountability Body
were adopted, the Accountability Body gave a positive opinion regarding the Request for an opinion on the Contracts and Service Level Agreements
amended fund documents in November 2021. (SLAs) with APG
The updated SLAs with the administrative organization APG were discussed in
Request for opinion on remuneration policy March 2021 as part of the annual policy cycle. The Accountability Body called
In the context of the RMGM, the Accountability Body was asked to give an for attention to the asset management fees, the costs per participant, and
opinion on the proposed decision-making with respect to the remuneration active searching for errors in the pensions administration.
policy. Following the commitment by the Board of Trustees that the WNT would
apply as the maximum remuneration, the Accountability Body gave a positive After extensive discussion, the Accountability Body issued a positive opinion on
opinion in November 2021. the SLA. It was also agreed that, subsequently, the Accountability Body would
be involved in developments in costs per participant at an earlier stage.
Request for opinion regarding amendment of the Regulations for the
Appeals Committee of ABP Request for opinion on the Actuarial and Technical Business
ABP has formulated more participant-oriented Regulations for the Appeals Report (ABTN)
Committee. The Accountability Body submitted a number of substantive and In connection with the annual update of the ABTN, the Accountability Body was
textual suggestions to the Board of Trustees, including strong support for asked to give an opinion on the proposed decision-making with respect to the
the publication of decisions. The Board of Trustees subsequently decided to 2021 ABTN. The Accountability Body issued a positive opinion on the request
publish decisions by the Appeals Committee in future. for opinion on the ABTN in April 2021.
The Accountability Body gave a positive opinion regarding the amendment of

the Regulations for the Appeals Committee of ABP in June 2021.
Request for opinion on AB Regulations Ultimately, 20 members gave a positive opinion, 20 members gave a negative
In 2021, the Regulations for the Accountability Body (AB Regulations) were opinion, and 6 members abstained. The votes were therefore tied and thus
rewritten in clear and simple language and a connection was made between did not lead to any clearly positive or negative opinion. In such cases, the AB
the 2022 election regulations and the Regulations for the Accountability Body. Regulations state that the opinion is therefore negative.
The regulations were also amended to the new governance model of ABP,
which applies with effect from January 1, 2022. The Accountability Body The members of the Accountability Body that gave a positive opinion stated
approved the amended AB Regulations in November 2021. that they accepted the reasoning from the Board of Trustees for achieving
stabilization of the contribution in 2022 and that they therefore endorsed the
Request for opinion on the strategic communication plan for 2022-2024 Board of Trustees’ decision.
The strategic communication plan is a guideline for the proposed method of
communication with the participants and employers of ABP. The policy is based Various arguments were put forward for a negative opinion by several
on the experience and feelings of participants and employers of pensions, members of the Accountability Body:
on the basis of insights and findings from surveys. The Communication • that the phasing of the contribution proposed by the Board of Trustees
Committee of the Accountability Body was closely involved in the formulation – over a two-year term – was expected to lead to sufficient contribution
of the strategic communication plan. The Accountability Body issued a stability in 2023 by the employers, but not by the employees;
positive opinion regarding the 2022-2024 strategic communication plan in • that, on the basis of the Contribution and Indexation Memorandum,
November 2021. the pensions would not be increased in 2022, or that there was not
sufficient comfort from the Board of Trustees that, on the basis of
Request for opinion on the Contribution and Indexation the changed regulation, there was a realistic prospect for increasing
Memorandum 2022 pensions with retroactive effect from mid-2022, or that a proposal to this
The Contribution and Indexation Memorandum 2022 was discussed in effect be included in the Contribution and Indexation Memorandum. The
November 2021. This memorandum is an integrated request for an opinion Accountability Body stressed that there is social concern regarding the lack
on the retirement pension/surviving dependents’ pension contribution, the of an increase in pensions, also in the context of the NPC, and has drawn
contribution for military personnel, and the wet Vervroegd pensioen en the attention of the Board of Trustees to this issue;
levensloop (VPL, legislation on the pre-pension and life-course savings scheme) • that the contribution in 2022 should already be based on the structurally
contribution. The memorandum states that the pensions will not be increased. necessary discount rate of 2 percent and that the contribution coverage
The memorandum was the subject of intense discussion with the Board of ratio is too low and has a negative effect on the funding ratio.
Trustees, involving an exchange of views.
Request for opinion on the 2022 strategic investment plan regulations. The election regulations have also been rewritten in clearer and
ABP has formulated a new strategic investment plan known as STIP. simpler language, to make them more comprehensible to the participants
of ABP.
The new STIP applies to 2022. It lays out the key investment decisions that ABP
has to make, namely: The Communication Committee was involved in the preparations for
• the desired strategic asset allocation across investment categories. The risk the elections in 2022. Among other things, attention was paid to the
profile of this asset allocation will be analyzed in the light of all rights and communication strategy in each phase (such as the nomination of candidates
obligations at fund level, in both the short and the long term; and the voting period) through the election timeline. In addition, an electoral
• the return target per investment category, expressed as one or committee has been formed. The number of seats for representatives of
more benchmarks; the participants and representatives of the pensioners in the Accountability
• the extent to which ABP is prepared to allow the actual investment Body has also been established. Based on the total number of participants
portfolio to deviate from the strategically intended portfolio, temporarily and pensioners of ABP on November 1, 2021, the allocation of seats on the
or otherwise; Accountability Body with effect from July 1, 2022 is as follows:
• consideration of balance sheet risks, including the mitigation of interest- • 19 members representing employees (or participants);
rate and currency risk. • 13 members representing pensioners;
• 16 members representing employers.
The Investment Committee of the Accountability Body was closely involved in
the formulation of the strategic investment plan for 2022. Among other things, Grip on Data solution framework
the Accountability Body asked the Board of Trustees to provide further details During the reporting year, the Accountability Body devoted continuous
of the costs of asset management and its considerations of how to limit these attention to the Grip on Data project[1], also by asking the Board of Trustees for
costs going forward. The Accountability Body issued a positive opinion on the progress updates. The Accountability Body also urged the participants to find
2022 strategic investment plan in November 2021. out what the consequences of this project will be for them. Issues discussed
concerned errors in the administration with respect to the “concurrent years of
service provision [2]” and the restoration of the surviving dependents’ pension
Other issues on GUPOs. The Accountability Body was updated on the progress of the project
at the beginning of 2022.
Accountability Body elections in 2021-2022
The newly elected Accountability Body will take up its duties on July 1, 2022. Increased ambition relating to climate and energy
Elections will therefore be held in 2022. In preparation for this, the Executive The Accountability Body discussed sustainable and responsible investing with
Office of ABP and the Accountability Body evaluated the elections held in 2018. the Board of Trustees a number of times during the year. The Board of
The points from this evaluation were extensively discussed by the General Trustees announced in 2021 that it was intending to refine its policy for
Committee. This led to a number of substantive changes to the election sustainable and responsible investing, The Board of Trustees also stated that
the implementation of policy no longer adequately met expectations from the informed in this respect. Critical questions were asked concerning the voting
public, including participants and employers. As a first step in this refinement behavior of ABP on climate resolutions.
of our policy, the Board of Trustees decided in October 2021 to no longer invest
in producers of fossil fuels. In its discussions with the Board of Trustees, the
Accountability Body called, among other things, for attention to the process Assessment of the Board of Trustees’ management in 2020
followed, substantiation of decision-making, the considerations of various
alternatives by the Board of Trustees, and how policy changes are linked to The Board of Trustees rendered account for its management in 2020 to the
maintaining return. Accountability Body on April 29, 2021. Prior to this meeting, the substance
of the annual report and financial statements was examined in a committee
Policy on ancillary positions meeting attended by the external auditor, the external actuary, and the ABP
As a result of an ancillary position held by Mr. Snel (with the Dutch industry compliance officer, who gave further explanations.
association of oil and gas companies), the Accountability Body made various
observations and raised a number of substantive questions regarding ABP’s The final assessment expresses the opinion of the Accountability Body
policy on ancillary positions. Together with the ABP Board of Trustees, Mr. Snel regarding the management by the Board of Trustees. The Accountability Body
decided to step down as a trustee of ABP on September 1, 2021. The Board of makes recommendations for improvements to and adjustments of policy.
Trustees has reviewed its policy on ancillary positions, partly due to pressure There is room for separate groups to state different points of view or
from the Accountability Body. comments if they so wish.
The Accountability Body also put various critical questions regarding the The Accountability Body has, with due regard for the findings and
appointment of Mr. Rosenmöller to the ABP Board of Trustees on December recommendations, reached a favorable opinion on the Board of Trustees’
1, 2021. These related to a potential conflict of interest between the current management with respect to the policy pursued, policy choices, and
ancillary position of Mr. Rosenmöller (Chair of the parliamentary group in the compliance with the principles of good pension fund governance. A minority
Senate of GroenLinks) and the position of member of the Board of Trustees of the Accountability Body reached a negative opinion.
of ABP. Specific agreements were made regarding the compatibility of the
positions concerned, with the conclusion that there was no conflict of interest. The Accountability Body's findings and recommendations have been shared
with the Board of Trustees. These are included in ABP’s 2020 annual report.
Inclusion policy training meeting
A training meeting for the inclusion policy was held on May 27, at which The Board of Trustees reports periodically to the Accountability Body on follow-
members of the Accountability Body were given more information on how up to the recommendations.
the criteria for inclusion of investments had been established. There was also
attention to engagement processes and how the participants could be better
Thematic workshops Financial structure and risk appetite

ABP establishes its financial structure on the basis of an asset-liability
New pension contract (NPC) management (ALM) study once every three years. An ALM study encompasses
Pension funds are currently engaged in preparations for the NPC. The NPC will the financial risk appetite as well as the financial structure. The financial risk
not come into effect for a couple of years yet. Since this is a major operation, appetite consists of short-term and long-term risk appetite. An opinion from
preparations are already fully under way. Important decisions have to be the Accountability Body is not required for an ALM study, but this forms the
taken about both pension accrual in the future and existing pensions. These starting point for the strategic investment policy, which is submitted to the
decisions will affect former and active participants, and pensioners as well. Accountability Body for an opinion.
There are three areas in which the Accountability Body has a role:
1. the transitional Financial Assessment Framework (FTK); The key starting points for the ALM study, economic scenarios, the discount
2. the NPC program; rate for the contribution, the strategic investment framework, and the short-
3. the transition to the new reality and the new pension scheme and term and long-term risk appetite were discussed during a thematic workshop
its administration. in November 2021. There was also an exchange of thoughts on the findings of
the investment review by DNB, which took place between April and June 2021.
A separate thematic workshop on the NPC was held in September 2021. The
Accountability Body is involved in the NPC program and related projects for In 2022, the Board of Trustees will engage in further dialog with the
realizing the transition to the NPC. This also involved a review of the dilemmas Accountability Body on the risk appetite and balance in the consideration
and challenges and zoomed in on the time schedule for the implementation of interests.
of the pension agreement and the division of the roles between the various
stakeholders. There was also discussion of the expectations gap with the Board [1]
In 2019, the administrative organization APG and ABP agreed, in addition to
of Trustees. The issues raised here included the inability or inadvisability of resolving identified incidents, to apply improved data analysis tools to actively
increasing the pensions, the financial position of the fund, the present and and systematically search for errors in the administration. This is known as the
future expectations of the ABP participants, the adaptation of pensions in the Grip on Data project.
NPC, and the possibilities for increasing the pensions under the transitional FTK
(the calculation rules applying during the transition). The Accountability Body [2]
This is a scheme in which there is entitlement to an additional benefit if
was also included in the insights obtained from the participant survey of risk partners were at the same time accruing pension with ABP prior to January 1,
appetite, and ideas were exchanged on the method and approach used. 1995. Dual income couples who were accruing pension at the same time with
ABP and another pension fund before January 1, 1995 may also be entitled to
additional benefit.
Contents Opinion of the Accountability Body ABP Annual Report 2021 119
Opinion of the
Accountability Body
The Board of Trustees renders annual
account to the Accountability Body for the
policy pursued and for compliance with
the principles of pension fund governance
as referred to in the Pensions Act
(Implementation) Decree (Besluit uitvoering
Pensioenwet) and the Occupational Pension
Scheme (Obligatory Membership) Act
(Wet verplichte beroepspensioenregeling) of
December 18, 2006.
The Accountability Body hereby, in this

context, shares its opinion with the Board of
Trustees and gives its opinion on the Board
of Trustees’ management in 2021 together
with its recommendations for 2022.
General The Accountability Body has the following observations with respect to the
2021 annual report and financial statements. The Accountability Body wishes
The Accountability Body's opinion over 2021 addresses the following topics in to express its appreciation for the transparency of the annual report and the
the following order: clear presentation of the 2021 financial statements. The Accountability Body
• the annual report and financial statements; accordingly notes that the principles of good pension fund governance have
• the new governance model; been observed.
• grip on the administration;
• the new pension contract (NPC); The Accountability Body appreciates the extensive reports from the external
• investments and the sustainability policy; auditor and the certifying actuary, and the details provided in their conclusions
• the reputation of ABP. and recommendations. The detailed remarks regarding the administrative
relationship between ABP and APG are a notable feature. In this relationship,
The Accountability Body bases its findings on the joint meetings with the Board the Accountability Body calls on the Board of Trustees to devote special
of Trustees, consultations with the Supervisory Board and the draft or final attention to strengthening compliance risk management, a further decrease in
annual report for 2021. the findings in the assurance reports received from APG (Standard 3402/3000),
compliance with anti-money laundering legislation (the Wwft) and regulation,
The Accountability Body appreciates the efforts made by the Board of Trustees and adequate measures in relation to cyber security. The Accountability Body
during the reporting year to involve the Accountability Body in decision-making, expects the Board to implement the recommendations by the auditor and
policy decisions, and strategic developments, even though the measures the actuary in 2022, so that the number of “opinions with qualification” will
imposed in relation to the pandemic restricted the opportunities for mutual decrease further in 2022.
contact and physical meetings.
The Accountability Body calls for special attention to the subject of indexation,
referring in particular to the social and other effects of the increasing backlog
2021 annual report and financial statements of unallocated indexation on the purchasing power of pensioners and the
effects on the pension accrual of active participants. This subject was also
Finding raised in the discussion of the contribution and indexation memorandum,
In connection with the draft or final annual report, a delegation from the with the conclusion that indexation was not possible under current regulation.
Accountability Body held discussions with the external auditor, the certifying As a result of proposed changes to legislation and regulation, full or partial
actuary, and the Compliance Officer and took note of their reports. These indexation may be possible with effect from July 1, 2022. While the Board –
officers provided further explanation of their reports. compelled by legislation and regulation – is not able to make a “free” decision
regarding the indexation of pensions, it has expressed its intention to allocate
indexation as soon as there is an opportunity to do so. The Accountability
Body calls on the Board to continually monitor progress on this and keep the Despite this unfortunate start, the Accountability Body appreciates the way in
importance of a balanced consideration of interests in mind. which the Board of Trustees involved the Accountability Body in the process
surrounding the transition to the RMGM. The Board was open to the items of
Recommendation attention and objections raised by the Accountability Body both on request
The Accountability Body requests the Board of Trustees to: and on its own initiative and put forward new and revised proposals on
• reflect expressly on the above-mentioned recommendations from the this basis. Despite the intensive and constructive discussions, a part of the
auditor and certifying actuary in its regular reporting on recommendations Accountability Body still has concerns regarding the ultimate design of the
in the opinion of the AB for 2021; RMGM. The formulation and operation of internal supervision in the RMGM,
• follow up on its previously expressed intention to apply indexation when which will no longer be independent, remains an item of concern. There is
the regulations governing this are eased. also still the question of whether a more efficient and effective governance
culture will be achieved with the RMGM and whether the new management
structure will actually lead to an improvement in the relationship with APG. The
The new governance model Accountability Body has expressed its concerns regarding the combination of
different roles for the independent Chair, as Chair of the General Board (GB),
Finding the Non-Executive Board (NEB), and the Audit Committee, and has proposed
The Accountability Body discussed the studies relating to the transition from that, after one year, there should be a review to determine whether this
the equal representation model to the reversed-mixed governance model combination of roles works in practice. The Accountability Body also called
(hereinafter: RMGM) with effect from January 1, 2022 with the Board of for a review in due course of the size of the GB or the ratio between the
Trustees on several occasions during 2021. NEB and the Executive Board (EB), looking in particular at whether the current
size of the EB relative to the current size of the NEB is appropriate for
The study got off to a somewhat difficult start. The Accountability Body ABP’s goals in terms of professionalization and effectiveness. The extent to
supported the Board’s formulated objective that, given the developments in which a further reduction of the NEB contributes to professionalization and
the pensions field, ABP needed to be managed more effectively and efficiently effectiveness needs to be studied.
in order to meet serious challenges, including the relationship with APG and
the transition to the NPC. The Accountability Body asked questions about The Accountability Body has taken note of the attention paid by the Board
the analysis and considerations that led to the choice of the RMGM. These of Trustees to cultural and conduct-related aspects as a consequence of
questions were only partially answered, as were questions regarding the the decision to adopt the RMGM and implement the related organizational
extent to which other potential solutions, including an adjustment to the changes. It is still necessary for this program to be completed, despite
current structure, would contribute to achieving the objective. Clear insight the pressure of daily business. The Accountability Body is pleased to note
into these aspects at the beginning of the process could perhaps have that, with the introduction of the RMGM, ABP’s remuneration policy has
benefited the substantive discussion of the structure of a new and supported been reformulated in line with the WNT standards applying to government
governance model.
organizations. Remuneration at ABP will thus be in line with socially and the allocation of roles within this should be explained and opened to
acceptable standards. discussion (management of expectations).
It became clear during the process that continued investment in the

relationship between the Accountability Body and the Board is beneficial. This Grip on the administration
relationship has been the subject of discussion in recent years, and steps
have been taken to improve it. For example, the Board of Trustees now Finding
offers more insight into issues discussed at its meetings. The Accountability In past years, the Accountability Body has repeatedly called for attention for
Body appreciates this and urges the Board to continue this transparency. The management of the administrative activities performed by APG. Two themes in
relationship is indeed based on mutual trust, transparency in exchange of particular have been raised repeatedly: reducing the complexity of the schemes
information, and expression of expectations, with mutual understanding of and getting a grip on the data, despite all the intractable problems.
the roles of these two organs. This process has once again made it clear that
these points require continued attention and that timely communication is a In its response to the opinion of the Accountability Body on 2020, the Board
key factor. When a new Accountability Body is appointed in July 2022 and the of Trustees stated that it considered error-free administration of the pension
new members are appointed, it would be useful to devote attention to how scheme, as far as possible, as a top priority. The Grip on data and Complexity
the duties, roles, and responsibilities of the Accountability Body and the Board Reduction projects were cited as examples of action taken by the Board to
are formulated. make the administration as error-free as possible.
Recommendation Much work was done on getting more “grip on data”, but this also brought new
In summary, the Accountability Body has the following recommendations: problems to light. In addition to the remedial actions carried out in 2021 in
• the operation of the RMGM should be evaluated for the first time after accordance with the action plan, it emerged that there were other inaccuracies
one year, with attention to the original objective of increasing the efficiency and omissions that required different remedial measures. The original deadline
and effectiveness of management with respect to matters such as the (January 1, 2023) in the Grip on data action plan for the completion of remedial
management of the administration by APG; actions was not met by APG. The Accountability Body notes that the estimate
• the evaluation should include the operation of the internal supervision and of the complexity and workload involved in the original action plan was clearly
the different roles of the independent Chair as Chair of the GB, NEB, and too ambitious and that the room for unforeseen issues allowed for in the
Audit Committee; plan was not sufficient. This raises questions regarding the assumption of
• a review of the extent to which the current size and ratio between the NEB the seriousness and scale of the shortcomings in the administration. This
and the EB contributes to a more effective and efficient organization, and also involves issues previously raised by the Accountability Body regarding
the extent to which further adjustment should be made; the “robustness” of the program management, the available capacity, and the
• when the new Accountability Body is introduced in July 2022, the duties, knowledge and competences at the administrator needed to bring this kind of
roles, and responsibilities between the Accountability Body and the Board project to a satisfactory conclusion.
Failure to meet the deadline could have consequences for following measures • inform the Accountability Body on how balanced consideration is to
that – also in view of the NPC – have to be taken to get the systems operable on be achieved in the amendments to Appendix K and the individual and
time. In this sense, the risk of this issue mentioned last year is still significant, collective interests of the participants concerned will be taken into account.
and the concerns expressed by the Accountability Body last year regarding the
administration of the pension schemes by APG have not diminished.
The New Pension Contract
The Board of Trustees states that resolving the current level of complexity
in the pension schemes is also necessary for the introduction of the NPC. Finding
The Board has studied what is possible and not possible for the conversion Further steps were taken on the way to a new pension contract (NPC) during
of Appendix K. A limited number of options have been identified, with an the reporting year. This process is followed closely by the Accountability Body,
emphasis on the manageability of potential solutions. The Board’s study serves and the Accountability Body appreciates how the Board of Trustees has shared
as input for the Pension Board in its assessment of transitional arrangements information on progress. The Accountability Body is aware that it has no formal
in the current scheme and the formulation of proposed solutions. In this light, role in the process during this phase, but it notes that timely information on
it is unfortunate that this assessment did not begin until the end of 2021. the structure of the new contract is essential for its activities in later phases
For the Accountability Body, it is important that ABP continues to review the of the process, when it will have the right to give an opinion regarding various
findings of the Pension Board to ensure they give balanced consideration to proposed Board resolutions in the transition to the NPC. To be in a position to
the individual and collective interests of the participants before implementing give a good opinion, it is important that the Accountability Body is also aware of
them. Simplification should not be an end in itself and must not be to the the policy-related views, elaborations, and recommendations of ABP regarding
detriment of the interests of the participants. the steps to be taken.
Recommendation The formulation of the NPC will undoubtedly lead to different requirements
The Accountability Body requests the Board of Trustees to: and accents with regard to the structure, communication, and administration
• give highest priority to projects aimed at getting the administration under of the pension scheme. Even if some issues are not subject to the right to give
control, so that these are successfully completed before a start is made on an opinion, it will still be beneficial if the Accountability Body is involved as far
implementation of the NPC; as possible in the processes relating to the formulation of the NPC.
• inform the Accountability Body on a regular basis – preferably quarterly –
on the progress of projects and – if needed – which fall-back scenarios are
available if new problems are identified;
• provide adequate information to the participants on possible changes/
amendments in pension schemes, with an explanation of the consequences
thereof (expectations management);
Recommendation The Board has included the Accountability Body in the formulation of the
The Accountability Body requests the Board of Trustees to: Strategic Investment Plan (StIP) and the associated considerations, including
• involve the Accountability Body and inform it regarding the development of the ALM study, which contributed to determining the risk appetite in the
the various aspects of the NPC in a timely manner. The underlying principle StIP. However, the Supervisory Board and DNB urged ABP to give more
is that the members of the newly appointed Accountability Body should demonstrable consideration to the point of view of the participants in
be informed in a timely manner in order to prepare for the proposed setting the short-term risk attitude. The Board has accordingly formulated an
resolutions for which the Accountability Body will have the right to express improvement plan and established the StIP for only one year instead of the
its opinion. The Accountability Body assumes that it will be involved in the usual three years. A new StIP will therefore be formulated in 2022.
“build plan” of the NPC;
• devote explicit attention in the training program for the new Accountability The Board of Trustees has finalized its sustainability policy for 2015-2020,
Body to all aspects of the NPC, also in relation to the role of the which serves as the basis for the new sustainability policy. The Accountability
Accountability Body. Body had previously advised that the inclusion policy should be further
refined and detailed, with specific attention to tax policy and labor conditions.
Unfortunately, no detailed inclusion criteria were produced in 2021. The
Investments and the sustainability policy Board of Trustees has, however, stated that it will do this. The Accountability
Body is watching with interest to see how this will be implemented. In a
Finding previous recommendation, the Accountability Body called for the impact of
The investment policy realized a return of 11.4 percent in 2021, and the the sustainability policy to be made clear to the participants. This involves,
average return over the past 15 years has been 6.7 percent. The policy thus for instance, the impact of engagement tracks. Other than the proportion of
makes a positive contribution to the objective of the fund. On the other hand, SDG-related investments in the portfolio and the reduction of the portfolio’s
the costs of asset management have risen in comparison to previous years. CO2 footprint, the Accountability Body has as yet seen little actual feedback on
The Accountability Body is aware of the fact that the higher performance- the impact of the sustainability policy.
related fees are the result of good returns and wide diversification, but it
also notes that these high fees are difficult to justify to the participants. The The Accountability Body is pleased with the decision to cease investing in fossil
Board of Trustees has chosen a course whereby more direct investments will fuel producers at a faster pace, but notes that the change of stance with
be administered by APG, which will reduce the amount of the performance- respect to fossil fuel investments came across as very abrupt. In the course of
related fees. The Accountability Body approves of this decision, but considers 2022, there will be further work to determine whether less liquid investments
it important that the development of returns from these investments is in fossil fuels can also be sold and the extent to which the related supply
properly monitored. industry will be included.
Recommendation Reputation
The Accountability Body requests the Board of Trustees to:
• explain how the costs of asset management are calculated in the annual Finding
report and the StIP, to show how trends have developed over the years, Events and incidents at ABP have led to national media attention during the
and to state the Board’s approach to managing this aspect. As part of a reporting year. One of these events concerned the combination of ancillary
revaluation of the costs of investing, the Accountability Body argues for positions within the Board of Trustees, raising critical questions about the
an explicit policy of achieving return with less excessive costs. On this last integrity of the trustees of ABP. This kind of negative attention harms the
point, with special attention to the high costs in the private equity category; confidence of the participants in ABP and can damage ABP’s reputation. With
• explain to the Accountability Body how the improved risk appetite has some degree of surprise, the Accountability Body notes that, in this situation,
been created and how the point of view of the participants affects the there was clearly inadequate awareness and reflection by the Board regarding
risk appetite; reactions from the public. The Accountability Body is pleased to note that – in
response – the Board had its policy on ancillary positions externally evaluated
• evaluate and give account of the effectiveness of the instruments for so that improvements could be made. By the same token, the changes to the
sustainable and responsible investment (i.e. exclusion policy, inclusion remuneration policy as part of the transition to the RMGM should prevent a
policy, engagement processes). The Accountability Body is keen to be kept situation in which the remuneration of trustees at ABP becomes a topic of
up to date with the results; discussion and thus puts pressure on ABP's reputation.
• continue to actively communicate with participants to allay concerns that
sustainable and responsible investment means less return; Recommendation
• further refine the inclusion policy in relation to the energy transition, labor The Accountability Body requests the Board of Trustees to:
conditions, and tax policy at businesses in which ABP invests. Inform the • expressly devote more attention in its decision-making processes to social
Accountability Body and the participants regarding the impact of the policy developments and views that could potentially harm ABP’s reputation and
as a whole; the confidence of the participants and proactively take account of these
• publicize the inclusion criteria for each sector. aspects going forward.
• In case of “incidents” with reputational impact, opt for timely, transparent,
and comprehensible communication to the participants with the aim of
maintaining confidence.
Opinion
The Accountability Body, based on its findings and the findings of the auditor,
the certifying actuary, the Compliance Officer, and The Supervisory Board,
issues a positive opinion on the Board of Trustees’ management with respect
to policy pursued, policy decision making, and compliance with pension
fund governance.
Board of Trustees’ response to the opinion issued by the

Accountability Body
The Board of Trustees has taken note of the findings and recommendations
of the Accountability Body with interest and thanks the Accountability
Body for the positive opinion issued on the policy pursued in 2021. The
recommendations of the Accountability Body will be included by the Board
of Trustees in the performance of its activities in 2022. In conclusion, the
Board wishes to thank the Accountability Body for its commitment, the
constructive cooperation, and the close involvement of its members over the
past four years.
Contents Financial statements ABP Annual Report 2021 127
Financial statements
Company financial statements 128 This year’s financial statements, in contrast to customary
Notes – general 131 practice, place the company financial statements before the
Risk section 143 consolidated financial statements. The reason for this is
Notes to the company balance sheet 156 that the company financial statements offer the best insight
Notes to the company statement of income and expenses 176 into the pension fund’s financial position and are in line
Notes to the company cash flow statement 184 with other external publications and the policy information
Other notes 185 presented in the Report of the Board of Trustees
Consolidated financial statements 189
Notes – general 192
Risk section 194
Notes to the consolidated balance sheet 195
Notes to the consolidated statement of income and expenses 208
Post-balance sheet events 211
Notes to the consolidated cash flow statement 212
Other notes 213
Signatories to the financial statements 216
Contents Company financial statements ABP Annual Report 2021 128
Company balance sheet

After appropriation of result
in € mln Notes 31-12-2021 31-12-2020 in € mln Notes 31-12-2021 31-12-2020
Assets Capital and liabilities
- real estate 77,826 60,721 - general reserve 52,847 -34,530

- equities 228,837 206,726 - specific reserves 760 978
- fixed-income investments 219,233 195,859
- derivatives 34,234 50,431 Pension fund capital 3 53,607 -33,552
- other investments 37,257 58,379
Provision for pension liabilities 4 498,797 529,865
Investments 1 597,387 572,116
- collateral received 14,977 25,920
Other assets 2 1,976 1,934 - short positions - 287
- short-term borrowing 6,806 23,958
- derivatives 21,235 24,798
Investment-related liabilities 5 43,018 74,963
Other liabilities 6 3,941 2,774
Total assets 599,363 574,050 Total capital and liabilities 599,363 574,050
Company statement of income and expenses

in € mln Notes 2021 2020 in € mln Notes 2021 2020
Income Collection cost supplements in

Pension contributions (net) 7 12,604 11,631 pension contributions 11 116 110
Value transfers 12 242 81
-investment results (gross) 57,029 31,097 Pension administration costs (net) 13 -156 -141
-less: asset management costs -609 -475 Interest charges on investment-related liabilities -16 -68
Other income and expenses -211 -219
Investment results (net) 8 56,420 30,622
Total expenses 18,135 -66,154
Total income 69,024 42,253 Balance of income and expenses 87,159 -23,901
Expenses Appropriation of the balance of income
and expenses:
Pension payments 9 -12,908 -12,382
- added/charged to general reserve 87,377 -23,819
- added to specific reserves -218 -82
Movements in provision for pension liabilities
- pension accruals -20,546 -17,374
- added interest 2,842 1,550
- utilized for pensions 12,864 12,439
- result on actuarial assumptions 702 928
- utilized for pension administration costs 105 96
- change in market interest rate 34,220 -63,194
- change in actuarial assumptions 2,560 13,449
- change in respect of value transfers -211 -62
- other movements in provision for
pension liabilities -1,468 -1,367
Total movements in provision for

pension liabilities 10 31,068 -53,535
Company cash flow statement

in € mln Notes 2021 2020
Opening balance of cash 1,356 1,094

Movements
Cash flows from pension activities:
- contributions received 12,720 11,741
- value transfer payments received 12 284 126
- pensions paid 9 -12,908 -12,382
- value transfer payments made 12 -42 -45
- operating expenses paid 13 -141 -141
- other movements 64 -238
Cash flow from pension activities -23 -939

Cash flows from investment activities:
- repayments and sales of investments 102,318 78,117
- advances and purchases
of investments -65,025 -101,581
- direct investment income 5,515 7,937
- indirect realized results from
derivatives and results on exchange -11,103 12,142
- investment expenses paid -591 -475
- collateral received -10,515 3,777
- other movements -20,404 1,284
Cash flow from investment activities 195 1,201
Closing balance of cash 1,528 1,356

Contents General notes to the company financial statements ABP Annual Report 2021 131
Notes – general
Features of the pension schemes is referred to as the “exempt-exempt taxation system”), with the exception
of net pensions ("nettopensioen"), which are paid free of tax. The accrued
Introduction pension rights represent unconditional liabilities of the pension fund toward
ABP is the pension fund for employees in the public sector, in education, and its participants. The pension fund retains all risks and does not reinsure risks.
in designated and admitted bodies, as well as the airports sector. The content Pension accrual ceases on the termination of participation.
of a pension scheme is determined by the Pensioenkamer van de Raad voor
het Overheidspersoneelsbeleid (ROP, Pension Board of the Council for Public Recipients of redundancy pay, participants entitled to severance pay, and
Sector Personnel Policy). ABP implements a pension scheme only once it has recipients of unemployment benefit or an invalidity benefit continue to partially
assessed the scheme agreed by the Pension Board in terms of its financial build up pensionable years of service. Participants with an incapacity for work
feasibility, practicability, and explainability. due to a work-related accident or occupational disease continue accrual during
the pensionable years of service to a maximum of 100 percent.
The legal relationship between ABP and the affiliated employers is set out
in the administration regulations, which are concluded by ABP and the The annual accrual depends on the following five factors: the accrual rate,
participants in the pension regulations. state pension offset, pensionable income, qualifying amount, and the part-time
factor. The pensionable income comprises the regular pay, regular bonuses
The administration regulations contain provisions governing mandatory and and pensionable variable bonuses from the preceding calendar year. The
voluntary affiliation, data and information to be provided, and payment of qualifying amount affects the rate at which the pension product is accrued.
contributions. The pension regulations contain provisions governing pension Pension contributions are deducted from the income above the state pension
claims and pension rights. The contents of both these regulations are available offset (state pension [AOW] contributions have already been withheld from
at the pension fund’s website (www.abp.nl). This section outlines the main the income in the first tax bracket) and paid by employers. The state pension
features of the pension schemes. offset for the contribution may differ from the offset for the accrual of new
rights, as the latter is income-dependent while the state pension offset is
General identical for everyone. Pursuant to the Pension Agreement, employers pay
Employees accrue their pensions during their working life, which become 70 percent of the contributions (retirement pension, surviving dependents'
payable on retirement, becoming incapacitated for work, or, in the case pension and occupational disability pension [AOP]) and deduct 30 percent
of a surviving dependents’ pension, on the death of the employee. The from the employees' pay. These percentages differ for contributions for the
contributions for pension accrual are not regarded as taxable salary and purchase of a conditional pension.
are, therefore, free of tax. However, pensions are taxed (pursuant to what
Agreements can be made at individual or collective level, with due regard Retirement pension (OP)
for the pension regulations, on the inclusion of certain variable income The retirement pension scheme is an average pay scheme in which pension is
components in pensionable pay. However, pursuant to statutory provisions, accrued over the pensionable income during each year of service. This accrual
some income components do not qualify as pensionable pay. confers a lifelong right to a pension. Flexible pension rights accrued prior to
2006 have been converted into retirement pension rights on an actuarially
As from January 1, 2021, the maximum pensionable salary is set at €112,189 neutral basis.
(in 2020: €110,111 (this amount is set once a year by ministerial regulation) for
full-time employment. Participants can opt, at the time of their full or partial retirement and within
certain bandwidths, to advance or defer the time at which their pension
ABP strives to invest deposited pension contributions in a socially responsible becomes payable, convert pension (for example, OP to or from PP), and
manner whenever possible, and with an optimum return. The goal of the temporarily receive a higher or lower pension. Participants can also opt to
investment policy is to realize sufficient long-term returns for index-linked accrue extra pension after leaving employment or continue their participation
pension claims and pension rights with affordable pension contributions and in the scheme on a voluntary basis.
at acceptable risks.
Surviving dependents’ pension (NP)
Indexation increases pension claims and pension rights and, therefore, the The partner's pension is accrued based on capital funding equal to 70 percent
unconditional liabilities of the pension fund. Each year, ABP assesses whether of the retirement pension, irrespective of the time of death. This avoids a
an increase is feasible, whereby the ambition is an inflation-indexed increase difference in the partner's pension before and after state pension age. There
based on the consumer price index (CPI). can also be a right to an orphan's pension in the event of death. The right to an
orphan’s pension payment ends when the orphan attains age 25.
Indexation is subject to the fund's financial position, although the indexation
ambition also extends to post-indexation to make up for indexation arrears or Incapacity pension (AAOP) and non-contributory accrual in the event
earlier reductions. If the pension fund’s financial position is inadequate, then of incapacity for work (PVAO)
nominal pensions must, as a last resort, be reduced to improve the position. Participants with a right to AAOP also have the right to PVAO in proportion
to the degree of their incapacity for work (provided that this is not
The pension products the consequence of a work-related accident or occupational disease) to a
The pension products are the retirement pension (OP), surviving dependents’ maximum of 50 percent. The amount of the AAOP is based on the Wet werk en
pension (NP) (which comprises partner's pension [PP] and orphan's inkomen naar arbeidsvermogen (WIA-dagloon) (daily wage under the Work and
pension), invalidity pension (AAOP, ABP occupational disability pension and Income (Capacity for Work) Act) and the degree of incapacity for work.
redeployment allowance), and individual voluntary pension supplements.
Purchase of conditional pension Pension swapping options

Following the abolition of the Vervroegde-Uitttredingsregeling (VUT, early The pension scheme offers various conversion options, for example conversion
retirement scheme) and prepensioen (pre-pension) scheme, employers and of retirement pension (OP) to partner's pension (PP) at the time the pension
employees had the option in 2006 and 2007 of making fringe benefit becomes payable, or vice versa. The OP (accrued to 2020) can also be
agreements on extra pension accrual over past years of service. In 2006, converted against the right to partner's pension at the time at which
the scheme was expanded to include the purchase of conditional pension in participation ends (other than on the OP becoming payable or on death).
periods prior to 2006 in which the pension accrual was less than the amount
permitted under the tax regulations. This means that the claims are conditional Value transfer
and only become vested on January 1, 2023, or on retirement prior to this Participants who enter into employment with an employer that is not affiliated
date. Therefore, the scheme is only applicable to participants who have been with ABP can transfer the pension accrued with ABP to another pension fund.
in continual employment since December 31, 2005 and who were born on On their retirement, former participants will receive the pension from the
or after January 1, 1950, or who were born before January 1, 1950 and who pension fund to which the accrued benefits were transferred, not from ABP.
did not qualify for Flexibel Pensioen en Uittreding (FPU, flexible pension and The converse is also possible: participants who enter into employment with an
retirement) benefit on January 1, 2006. employer affiliated with ABP can transfer the pension accrued with another
pension fund to ABP. The current conditions governing transfers of accrued
Voluntary products benefits are posted on the ABP website.
The pension regulations include provisions providing various options for the
voluntary accrual of extra OP/NP or for the voluntary continuation of the Pension scheme for military personnel
OP/NP scheme after leaving employment. Professional military personnel participate in a separate pension scheme that is
also implemented by ABP. Employees with the status of professional member
Net pension ("Nettopensioen") of the armed forces, former professional member of the armed forces entitled
Participants with an income above the maximum pensionable salary (set at to an occupational disability pension, and former professional member of
€112,189 as from January 1, 2021 and adjusted once a year by ministerial the armed forces entitled to a severance payment or unemployment benefit
regulation) may participate in the net pension scheme. This scheme, a defined participate in this sectoral scheme. Civilian personnel employed by the Ministry
contribution scheme, provides for supplementary pension accrual. The amount of Defense participate in the ABP average-pay scheme. The pension scheme for
of this supplementary pension is determined by the amount contributed, the military personnel was converted into an average-pay scheme specifically for
return on this amount and the purchase rates (influenced by the variable military personnel in 2019.
mark-up and interest) on retirement date. This scheme is voluntary, and
contributions are paid from net pay.
Accounting policies – general Basis of valuation and determination of results
Stichting Pensioenfonds ABP, with its registered office in Heerlen, the Netting
Netherlands, registered with the Chamber of Commerce under number Financial assets and financial liabilities are netted and presented as a net
41074000, has prepared these financial statements in accordance with the amount in the balance sheet only when there is a statutory or contractual right
generally accepted financial reporting policies in the Netherlands and the to net and simultaneously settle the asset and liability and, moreover, it is also
statutory provisions relating to financial statements set out in Title 9, Book 2, the intention to settle the items in this manner. Interest revenue and interest
of the Dutch Civil Code and the Annual Reporting Guidelines. These financial expense related to the presented netted financial assets and financial liabilities
statements have been prepared on a going concern assumption. are also netted.
The pension liabilities and the corresponding investments in the balance sheet Estimates
are mainly of a non-current nature. The investment-related liabilities item is Estimates and assumptions used in preparing the financial statements impact
also of a non-current nature, but pursuant to the guidelines is presented the recognized assets, liabilities, revenue, and expenses. This is, in particular,
separately in the balance sheet. The other balance sheet items are presented applicable to the determination of the provision for pension liabilities and the
as other assets and other liabilities, with the pension fund's capital as measurement of non-listed investments. It is possible that the measured value
balancing item. and actual value are subsequently found to differ.
All revenue and expenses are attributed to the period in which they relate. Recognition
Movements in the pension fund capital relate exclusively to the processing of Assets and liabilities are measured at current value unless otherwise stated.
the balance of revenue and expenses. The revenue and expenses are largely Assets are recognized on the balance sheet when it is probable that the future
related to accounting policies for investments recognized in the balance sheet economic benefits will flow to the pension fund and the value of the assets
and the provision for pension liabilities. can be measured reliably. Assets that do not comply with these criteria are not
recognized in the balance sheet and are classed as off-balance sheet assets.
The same accounting policies for measurement and result determination are Liabilities are recognized on the balance sheet when it is probable that the
adopted for the company and consolidated financial statements. All amounts settlement will result in an outflow of resources and the amount thereof can
are rounded to millions of euros unless stated otherwise. These financial be measured reliably. Liabilities that do not comply with these criteria are not
statements relate to the 2021 fiscal year that ended on the balance sheet date, recognized in the balance sheet and are classed as off-balance sheet assets.
December 31, 2021.
Revenue is recognized in the statement of income and expenses when an
increase in economic potential related to an increase in an asset or a decrease
in a liability has arisen and the amount thereof can be measured with sufficient
reliability. Expenses are recognized when a decrease in economic potential
related to a decrease in an asset or an increase in a liability has arisen and the period to 1995. This period of service is converted into a “notional claim”
the amount thereof can be measured with sufficient reliability. Revenue and to enable valuation of the provision for Appendix K on the basis of fair
expenses are allocated to the period to which they relate. value factors.
An asset or liability is no longer recognized on the balance sheet when a A further explanation is included in the note to the provision for pension
transaction results in the transfer of all or virtually all future economic benefits liabilities item and the movement in provision for pension liabilities in the
and all or virtually all risks relating to the asset or liability to a third party. “Change in actuarial assumptions” section.
Assets and liabilities are no longer recognized on the balance sheet from the
time at which the probability of future economic benefit and reliability of the
measurement of the value conditions are no longer met. Foreign currency translation
Changes in accounting estimates The year-end balances of assets and liabilities held outside the eurozone are
The actuarial assumptions were changed in 2021, which in total resulted in a translated into euros based on the exchange rates prevailing on the balance
€2.6 billion decrease in the provision for pension liabilities. The impact on the sheet date. The rates used for translation purposes are the World Markets
funding ratio was +0.5percentage points. Company fixing rates (WM) on the last day of trading for the year, at 4 PM
London time, as published by Reuters. The resultant translation differences are
• The transition to the new assumptions from the most recent recognized under the investment result item. Revenue and expenses in foreign
Grondslagenonderzoek (Actuarial Assumptions Study) 2017-2019 (GO1719) currencies are translated into euros based on the exchange rates prevailing
leads to a €2.7 billion decrease in the provision for pension liabilities. on the transaction dates. Differences between the transaction exchange rate
This decrease is mainly because a higher mortality rate of the surviving and the settlement exchange rate are also recognized under the investment
dependents and the partner, respectively, is taken into account in the result item.
valuation of surviving dependents’ pension. This amount also reflects the
transition to new flex factors (for advancement and deferral of pension).
The new flex factors were determined on the basis of a discount rate of 2.2 Basis of valuation of assets and liabilities
percent (2020: 2.4 percent) and the new GO1719 assumptions.
• Updating the R/N factors leads to a €0.1 billion increase in the provision Investments
for pension liabilities. An R/N factor (or Real/Notional) is the ratio
between the actual annual payments to Appendix K and the notional General
claims. These claims are termed notional claims because, by contrast to Investments are measured at current value. The following measurement
regular retirement pension (OP)/surviving dependents’ pension (NP) claims, methods are used, in the following order of priority and depending on
participants do not accrue claims for Appendix K. That is because the the availability of objective data, to measure the current value. A tiered
amount of the supplement depends in part on the (concurrent) service in approach is adopted in which the next lower-ranking measurement method
is used only when a higher-ranking method has been found inapplicable. The These measurement models are based on generally accepted principles that,
investments for ABP Nettopensioen (hereafter: ABP net pension scheme) and based on market parameters such as credit rating mark-ups, work with the
ABP ExtraPensioen are, in view of their small volume, recognized under the best estimates of expected future cash flows, which are then discounted at
investment item even though these are investments at the participant's risk. rates obtained from appropriate interest rate curves.
The accounting policy governs both investments at the pension fund's risk and
investments at the participant's risk. Volatilities and correlations are estimated using information in the public
domain. Credit risks are estimated using reference bonds. Interest curves used
Mark-to-market in the models are based on standards such as interbank interest rates and
In normal market conditions, investments are usually measured using listed interest rate curves of swaps and futures markets.
prices posted by independent price providers. These prices are not only
stock exchange quotations, but also prices posted daily by independent The administrative business’ measurement models are used primarily for
price providers. interest rate swaps, private loans, and mortgage portfolios. Discount curves
are created based on interest rates obtained from price providers and then
Broker quotes used to factor in future cash flows from interest rate swaps. Risks are smaller
When no quoted stock exchange quotations or prices posted by independent with received collateral, and a lower interest rate curve is used. Cash flows for
price providers are available or, in the prevailing market conditions, they the fixed, long-term interest rate component follow from the contract, and the
cannot be regarded as realistic, then the measurement of the current value cash flows for the variable, short-term interest rate component are based on
is based on quotes by at least three brokers. forward rates derived from the market. Price providers' interest rate curves
are also used for private loans, with a variable spread that depends on the
Mark-to-model borrower's sector. Account is also taken of an inflation curve derived from the
When no quoted stock exchange quotations or prices posted by independent market. A yield curve is used for mortgage portfolios and is based on consumer
price providers are available or, in the prevailing market conditions, they rates with markdowns for the compensation for lapsed optionality and the
cannot be regarded as realistic and broker quotes are also unavailable, mortgage granter and servicer fees included in the consumer rate.
then the current value is approximated using the administrative business’
measurement models. Account is then also taken of insolvency and illiquidity External estimates
risks according to basic, stress, and extreme stress scenarios. When no mark-to-market, broker quote, or mark-to-model measurement
method is available, then the current value is measured using estimates of the
The administrative business’ measurement models and the accompanying current value of the relevant investments periodically submitted by external
assumptions are evaluated by an external specialist at regular intervals and parties. The external estimates category is subdivided into investments with
at least once a year. and without an external independent assessment.
Internal estimates Fixed-income investments

When no reliable information is available to serve as input for the Bonds and index-linked bonds are measured at current value, when possible at
administrative business’ measurement models, then the current value is market quotations and adjusted with the attributable accrued interest.
determined based on an internal estimate. An external assessment is carried
out whenever possible with respect to the assumptions. Mortgage loans are measured at current value based on a model with a
variable spread for early redemption and credit and illiquidity risks. The
The tiered approach to the measurement methods referred to above is applied accrued savings capital is deducted from savings-based mortgages.
to all investment categories.
Investments in private loans are measured at current value with a model,
Presentation of net current assets adjusted based on market information, if necessary, supplemented with a
Investments are measured inclusive of associated receivables, cash, and variable spread for illiquidity and counterparty risks, and adjusted for the
liabilities, where these are not available for use for purposes other than attributable accrued interest. The current value of private loans is measured
investment transactions. After first recognition, these receivables and payables with a calculation of the current value of the contracted cash flows from these
are carried at amortized cost. In view of the short term to maturity, the carrying loans based on market interest rates appropriate for the remaining term to
value is virtually equal to the face value less any provisions deemed necessary maturity. Real estate capital leases are measured with variable spreads for
for irrecoverability risk. More details of the measurement for each investment illiquidity credit risks.
category are given below.
Derivatives
Real estate investments Derivative positions are measured at current value without netting.
Real estate investments are measured at current value, when possible at Measurement models based on certain assumptions, for example with respect
market quotations. When these are not available, measurement is at net asset to credit risk and interest rate curves, are used for specific instruments such as
value. Capital interests in real estate funds are recognized at net asset value. over-the-counter derivatives.
Equities Other investments

Investments in equity, convertible bonds and private equity are measured at Other investments are investments that cannot be allocated to any other
current value, when possible at market quotations. investment categories. These are mostly commodities and absolute return
strategies. These investments are measured at current value, when possible
at market quotations.
Other assets Specific reserves are components of the pension fund's capital that the Board
Participating interests are sustainable capital interests in which ABP can of Trustees has set apart for a future purpose. For this reason, these specific
exercise a significant influence on the business and financial policy. These reserves are not taken into account in the calculation of the funding ratio.
participating interests, like joint ventures, are measured at net asset value.
Other capital interests are presented in the investment category to which Provision for pension liabilities
they relate. The provision for pension liabilities is of a non-current nature. The provision
at the risk of the pension fund comprises the average-pay schemes and years
Tangible assets are measured at acquisition price less straight-line depreciation of service-related provisions for retirement pensions, surviving dependents’
calculated over the estimated economic life of the asset concerned, or at lower pensions and ABP occupational disability pensions (AAOP). The provisions for
value in use. ABP net pension scheme and ABP ExtraPensioen are, in view of their small
volume, recognized under the provision for pension liabilities, even though
After first recognition, receivables, prepayments, and accrued income are these are provisions at the participant's risk.
carried at amortized cost. In view of the short term to maturity, the carrying
value is virtually equal to the face value less, where applicable, provisions The provision for pension liabilities is measured at the fair value of the
deemed necessary for irrecoverability risk. expected future pension payments. Indexation or reductions in the pension
claims and pension payments are recognized as soon as the definitive decision
Cash is carried at face value. has been made. The provision for pension liabilities is determined based on the
nominal interest term structure applying on the balance sheet date, published
Pension fund capital by DNB.
The pension fund capital provides a source of funding to cover financial
setbacks and also a source for possible future indexation. The legislation The actuarial assumptions, including mortality rates, transfer probabilities,
governing pension funds prescribes that they must maintain capital of a and partner frequencies, are in principle updated once every three years
minimum of about 5 percent of their provision for pension liabilities. This can and evaluated at interim intervals. The actuarial assumptions for the
be regarded as an unavailable reserve. If the pension fund capital falls below ABP privatization transitional rights (OPA) are updated annually. Mortality
this level, then the deficit must be made up within the term prescribed by law. projections for measurements of the amount of the provision for pension
liabilities are based on the Projection Life Tables of the Royal Dutch Actuarial
Association (AG).
The following actuarial assumptions and methods are used for the funded on a risk basis. The “standard partner” method, based on an average
measurement of the provision for pension liabilities for retirement pensions age difference between the participant and their partner, is adopted for the
and surviving dependents' pensions, and for ABP occupational disability surviving dependents' pension. Partial use is now also made of a nominated
pensions (AAOP): partner system (in relation to whether there is/is not a partner).
• the nominal interest rate structure published by DNB for the measurement
of the current value of the pension liabilities. “Market interest rate” and Provision for ABP incapacity pensions (AAOP)
“current nominal market interest rate” in this document refer to the The AAOP scheme supplements the Wet op de
nominal interest term structure and current nominal interest term structure arbeidsongeschiktheidsverzekering (WAO, Invalidity Insurance Act) and, from
• the most recent AG projection tables 2006, the Wet werk en inkomen naar arbeidsvermogen (WIA, Work and Income
• gender and age-related tables for change of circumstances probabilities, (Capacity for Work) Act). This scheme provides for an occupational disability
based on pension fund observations of its members’ file: death (of pension to supplement the WIA. Both schemes are funded entirely on a risk
participants, of co-insured persons, and of dependents), invalidity, basis. The provision relates only to payable pensions, including payable but not
termination on leaving employment, and termination on receiving yet reported occupational disability pensions.
redundancy pay. The mortality tables take account of expected future
mortality trends. Partner frequencies on death are also used Provision for ABP Nettopensioen
• the assumption that participants and their dependents were born on July 1 The ABP Nettopensioen (net pension scheme) provision equates to the net
for the determination of their age fair value of the investments following the conversion of contributions made
• parameters including the average annual pension accrual and the average at the participants' risk and expense for the purpose of supplementing their
age difference between partners at the time of death pensions. The provision is used by conversion into another pension product,
• due regard for decisions by the Board of Trustees made up to the end of which is permitted only on retirement, termination of participation, or death.
the reporting period relating to changes such as granting indexation, which
go into effect on January 1 of the following year The value of the investments following the conversion of the contributions paid
• foreseeable future changes to the state pension age (AOW) into the ABP net pension scheme includes the investment returns obtained
• mark-up for future administration costs (relating to granting pensions and on the total investments. The equal liability to the participants in the ABP net
pension payments). pension scheme is, as counterpart to the value of the investments, included in
the provision for pension liabilities.
Provision for retirement pensions and surviving dependents' pensions
The retirement pension and surviving dependents' pension for death after Provision for ABP ExtraPensioen
age 65 are fully capital funded. The surviving dependents’ pension on death The ABP ExtraPensioen provision equates to the current value of the
before age 65 is also fully capital funded for years of service before July 1, investments following the conversion of contributions made at the participants’
1999, and after January 1, 2018. The surviving dependents’ pension on death risk and expense for the purpose of supplementing their pensions. The
before age 65 is, for years of service between July 1, 1999, and January 1, 2018,
provision is used by conversion into another pension product, which is Basis of determination of results
permitted only on retirement, termination of participation, or death.
General
The value of the investments following the conversion of the contributions paid The items in the statement of income and expenses largely relate to the
into the ABP ExtraPensioen scheme includes the investment returns obtained measurement principles for investments and provision for pension liabilities
on the total investments. The equal liability to the participants in the AEP in the balance sheet. Realized and unrealized results are recognized directly in
scheme is, as counterpart to the value of the investments, included in the the result.
provision for pension liabilities. ABP guarantees that participants receive at
least the amount of their contributions when they call on their provision. Pension contributions (net)
Account is then taken of the investment returns on the investments following Pension contributions less the mark-up are attributed to the period to which
the conversion of the contributions at the time of the calculation. they relate. The contributions are set based on information supplied by
employers. An estimate is made based on extrapolation when the necessary
Investment-related liabilities information has not been received from employers. The cover for collection
The repayment obligation arising from short-term borrowing is measured at costs is recognized under actuarial results/costs.
current value. After first recognition, this item is carried at amortized cost. In
the absence of premium or discount, this value virtually equates to face value. Investment results (net)
Investment results less asset management costs are attributed to the period
The measurement of the derivatives item with a negative current value to which they relate. Direct and indirect results from and costs (invoiced or
corresponds to the measurement of the derivatives with a positive to be invoiced) of investments are presented separately. Yields from interest,
current value. The short positions and collateral received are measured at dividend and similar are presented under direct results. Dividend is recognized
current value. at the time the dividend becomes payable. Movements in value are indirect
investment results and are attributed to the period in which they occur.
Other liabilities Movements in value are both realized and unrealized movements in value.
Payables and other liabilities are measured at current value. After first
recognition, payables and other liabilities are carried at amortized cost. In view Pension payments
of the short term to maturity, this is virtually equal to the face value. Pensions are attributed to the period to which they relate.
Movements in provision for pension liabilities From January 1, 2021, the DNB will gradually adjust the UFR method. The
UFR method presented in the advice of the Parameters Committee 2019 will
Pension accruals be introduced in four equal annual steps. In the new UFR method, the first
Pension accrual is attributed to the period in which the accrual of pension smoothing point is moved to 30 years, the phase-in factor of the UFR is
rights takes place. An exception to this is what is referred to as the reduced and the level of the UFR is determined as the average of the 30-year
“continuation of active service” for pension accrual in the case of incapacity for forward rate of the past 10 years. As a result, the interest rate term structure is
work and death. The cost of this future accrual of pension rights is recognized more dependent on the market interest rate and less dependent on the level of
immediately in the year in which the participant becomes incapacitated for the UFR.
work or dies.
Change in actuarial assumptions
Indexation The effect of the change in the actuarial assumptions on the provision
Indexation is charged to the statement of income and expenses when a Board for pension liabilities is calculated at the end of the reporting period and
of Trustees decision is made on or before the balance sheet date. recognized in the statement of income and expenses.
Added interest Result on actuarial assumptions

The added interest is calculated on the basis of the nominal interest rate for The result on actuarial assumptions is attributed to the period to which
a term of one year as included in the interest term structure published by this relates.
DNB for interbank swaps at the end of the preceding fiscal year. The interest is
calculated on the opening balance and the movements during the year. Changes in respect of value transfers
Changes in respect of value transfers are attributed to the period to which
Utilized for pensions and pension administration costs they relate.
The release from the provision for pension liabilities for pensions and pension
management is credited to the statement of income and expenses in the Other movements in provision for pension liabilities
period in which the pensions and costs were foreseen during the calculation Other movements in the provision for pension liabilities are attributed to the
of the provision. period to which they relate.
Movements in market interest rate Collection cost supplements in pension contributions

The effect the transition from the interest term structure at the end of the The coverage from mark-ups on contributions is attributed to the period to
preceding year shifted by one year to the interest term structure at the end which it relates.
of the reporting year has on the provision for pension liabilities is calculated
at the end of the reporting period and recognized in the statement of income
and expenses.
Value transfers Administration

Amounts on account of transfers/acquisitions of rights are recognized at face
value and attributed to the period to which they relate. ABP has outsourced most of the implementation of the pension scheme to APG
Groep NV, APG DWS en Fondsenbedrijf NV, and APG Asset Management NV.
Pension administration costs (net) ABP has concluded long-term contracts for this purpose. The most important
The net pension management costs are attributed to the period to which duties that the administrative business performs for the fund are pension
they relate. management, asset management, communication, and support services for the
Board of Trustees
Interest charges on investment-related liabilities
Interest charges on investment-related liabilities are attributed to the period to
which they relate.
Other income and expenses

Other revenue and expenses are attributed to the period to which they relate.
Basis of the cash flow statement
The cash flow statement has been prepared in accordance with the direct
method. Cash flows are attributed to the cash-generating activities. Only the
cash of ABP (and consolidated entities) is recognized in the opening and
closing cash balances for the cash flow statement. Cash in mutual funds is
not recognized.
Receipts and expenditures in foreign currencies on account of investment

activities are translated into euros at the transaction date exchange rate.
Differences between the transaction exchange rate and the settlement
exchange rate are recognized under the investment results (net) item. The
same rules apply to investments outside the Netherlands.
As all receipts and expenditures on account of pension activities are in euros,

there are no exchange differences with these activities.
Contents Risk section of the company financial statements ABP Annual Report 2021 143
Risk section Funding ratio development in 2021

120
Funding ratio
110
The Risk management section of the Report of the Board of Trustees sets out
the risk policy and the design, existence, and operation of the internal risk Minimum capital requirement (+100)
control and control systems. This section is of a more quantitative nature and
100
reviews the movement in the funding ratio, discount rate, minimum capital
requirement, and capital requirement, and the resultant deficit at year-end
2021. The section continues with a discussion of the methodology and outcome 90
of the solvency assessment and the recovery plan that has been submitted Policy funding ratio
and concludes with information about the derivatives portfolio, in view of the
80
important role this fulfills in the control of the risks. 31 Dec 2020 31 Mar 2021 30 Jun 2021 30 Sep 2021 31 Dec 2021
Movements in the policy funding ratio and the discount Discount rate development in 2021
rate in 2021 0.8
Two charts are presented below, the first of which presents movements in the
0.6
funding ratio and policy funding ratio during 2021 compared with the minimum
funding ratio, and the second chart presents movements in the discount rate.
0.4
0.2
0
31 Dec 2020 31 Mar 2021 30 Jun 2021 30 Sep 2021 31 Dec 2021
Policy funding ratio Funding ratio: position relative to the minimum capital requirement
The policy funding ratio is the average of the past 12 funding ratios. Averaging
in € mln 31-12-2021 31-12-2021
the funding ratios to obtain the policy funding ratio reduces fluctuations. The
policy funding ratio plays an important role in the contributions, indexation, Calculated general reserve (relative to funding ratio) 52,847 10.6%
and recovery policy. The policy funding ratio at year-end 2021 was 102.8% Less: Minimum capital requirement 21,021 4.2%
(2020: 87.6%)
Surplus relative to calculated general reserve 31,826 6.4%
Real funding ratio

A real funding ratio of 100 percent would enable ABP to grant full indexation
every year. This funding ratio is calculated by determining the indexation The pension fund had a minimum capital requirement surplus at year-end
limit for full future-proof indexation. The real funding ratio is equal to the 2021. The general reserve relative to the funding ratio was €52.8 billion at
policy funding ratio divided by the future-proof indexation limit. The real year-end 2021, which equates to a coverage surplus (the difference between
funding ratio, based on price inflation as the ambition level, at year-end 2021 the general reserve and the minimum capital requirement) of €31.8 billion.
was 83.6% (2020: 72.1%). The calculation, in accordance with the Financial
Assessment Framework (FTK) Decree, made use of the new parameters for The position relative to the minimum capital requirement can also be
inflation expectations and maximum return to be entered. determined on the basis of the policy funding ratio. In that case, there is a
deficit, as the policy funding ratio (102.8 percent) was lower than the minimum
required funding ratio (104.2 percent). See the table below.
Position relative to the minimum capital requirement
Policy funding ratio: position relative to minimum capital requirement
The funding ratio rose from 93.5 percent to 110.6 percent in the reporting year,
in € mln 31-12-2021 31-12-2021
which is comfortably above the minimum required funding ratio of 104.2%.
The general reserve, the difference between the available assets and the value Calculated general reserve (relative to policy
of the liabilities, therefore exceeds the minimum capital requirement. The funding ratio) 14,008 2.8%
Less: Minimum capital requirement 21,021 4.2%
minimum capital requirement itself is determined in accordance with Article
11 of the FTK Decree and was 4.2 percent of the liabilities at year-end 2021,
Deficit relative to calculated general reserve -7,013 -1.4%
which equates to €21.0 billion. See the table below.
The pension fund had a minimum capital requirement deficit at year-end 2021.
The general reserve relative to the policy funding ratio was €14.0 billion at
year-end 2021, which equates to a coverage deficit (the difference between the
policy funding ratio and the minimum required funding ratio) of €7.0 billion.
Recovery plan
As the policy funding ratio was below the required funding ratio of the strategic
portfolio at-year 2021, ABP was required to submit a recovery plan before April
1, 2022. The recovery plan showed that, under the regular policy, the policy
funding ratio could grow to the level of the capital requirement in time. This
means that no reduction in the context of the recovery plan will be needed
in 2022.
Solvency test
Pension funds are governed by the Financial Assessment Framework (FTK, part The calculation of the capital requirement begins with the determination of the
of the Pensions Act) and are under the supervision of DNB. The Financial pre-determined shocks associated with risk factors S1 through S10. These are
Assessment Framework provides for a solvency assessment to determine the then combined using the square root formula to obtain a total shock on the
funding ratio that a pension fund needs if a combination of shocks set out funding ratio. The square root formula takes account of the fact that the shocks
in the Financial Assessment Framework is to lead to a funding ratio of 100 will not necessarily occur simultaneously, so that the combined shock is less
percent. This funding ratio meets the prescribed capital requirement. Pursuant than the sum of the individual shocks (diversification effect).
to the FTK, the size of the shocks is pre-defined such that they occur with a
frequency of once every 40 years or, in other words, with a probability of 2.5 The standard for the capital requirement is defined such that the combined
percent each year. The capital requirement was reasonably constant over time shock leads to a funding ratio of 100 percent. The outcome fluctuates
and fluctuated around 126%percent during the year. Fluctuations in the level over time due to market conditions (such as interest and credit spreads).
were largely due to market interest rate movements. However, portfolio rebalancing in combination with risk restrictions maintains
the funding ratio near the ratio of the strategic portfolio. The standard model
The risk factors defined by DNB are: sets the liquidity risk (S7), concentration risk (S8), and operational risk (S9) at
• S1 Interest rate risk zero. With the policy pursued, these risks have been assessed as not requiring
• S2 Equities and alternative investments risk an increase in the capital.
• S3 Currency risk
• S4 Commodity risk This year, it has been decided to base the S-test on the strategic investment
• S5 Credit risk plan StIP2022 instead of the average standard portfolio during the coming
• S6 Underwriting risk year. That is because the StIP is the portfolio that is aimed at for the longer
• S7 Liquidity risk term, whereas the standard portfolio is a growth pathway towards this, which
• S8 Concentration risk is necessary because the portfolio of a large fund such as ABP cannot be
• S9 Operational risk adjusted quickly. One consequence of using the StIP in the calculation is that
• S10 Active risk the contribution of S10 to the minimum capital requirement is greater than last
year. The reason for this is described below. An added advantage of reporting
the minimum capital requirement of the long-term strategic portfolio is that
this is also the minimum capital requirement that is used as a target in the
recovery plan.
Equity position relative to capital requirement
The solvency test shows a capital requirement deficit at year-end 2021: the The capital requirement expressed as a percentage of the technical provisions
fund's capital is below the capital requirement. The following table presents the has increased to 26.3% percent of the liabilities since last year. This increase
results from the standard test on the strategic portfolio StIP 2022 measured at was mainly attributable to the high interest rate. The capital requirement at
year-end 2021. The shocks are determined in the situation in which the funding year-end 2021 (€131.2 billion) is calculated based on the long-term strategic
ratio meets the capital requirement. goal StIP2022 . The equities and alternative investments risk is by far the largest
component of the capital requirement.
Amount of deficit relative to capital requirement
in € millions and as percentage of the provisions 31-12-2021 31-12-2021 31-12-2020 31-12-2020
Risk
S1 Interest rate risk 9,089 1.8% 5,119 1.0%

S2 Equities and alternative investments risk 102,173 20.5% 110,434 20.8%
S3 Currency risk 40,025 8.0% 41,890 7.9%
S4 Commodity risk 13,230 2.7% 13,049 2.5%
S5 Credit risk 24,330 4.9% 25,545 4.8%
S6 Underwriting risk 14,457 2.9% 17,727 3.3%
S10 Active risk 26,554 5.3% 13,659 2.6%
Subtotal of all risks 229,857 46.1% 227,423 42.9%
Less: Diversification effect -98,668 -19.8% -90,755 -17.1%

Capital requirement 131,189 26.3% 136,668 25.8%
Less: Calculated general reserve (relative to policy funding ratio) 14,008 2.8% -65,747 -12.4%
Deficit relative to calculated general reserve (based on policy

funding ratio) -117,181 -23.5% -202,415 -38.2%
(S1) Interest rate risk understanding of the size of the shock. The five-year interest rate, for example,
is shocked by -33 percent, the ten-year interest rate by -25 percent and very
The interest rate risk is derived from the interest rate sensitivity of assets and low interest rates by -24 percent. The same shock in percentage points is then
liabilities and is an important element for the mismatch risk. The mismatch risk applied to the market interest rate curves used in measuring the swaps and the
is the difference between the interest rate sensitivity of the investments and fixed-income investments.
of the liabilities. An increase or decrease in the interest rate affects the assets
and liabilities and, as a result, the funding ratio. The interest rate risk S1 has More than half of the interest rate sensitivity of the investments originates
decreased over the last decade as the interest rate shock is a fixed fraction of from the fixed-income investments and the remainder from the interest-rate
the interest rate curve, resulting in a lower interest rate that leads to a smaller derivatives. The interest rate sensitivity is expressed in terms of “duration”,
interest rate shock. The interest rate rose in the past year, however, which is which is approximately equal to the average weighted maturity of all cash flows
reflected in the increase in S1 (see table). (coupons and repayments of principal) from the fixed-income investments
and interest-rate derivatives. The duration can be interpreted as follows: a 1
ABP uses the partial duration method to calculate the interest rate risk S1. percentage point fall in market interest rate will result in a percentage increase
This ensures that both the variation of the interest rate sensitivity along the in the value of the portfolio equal to the duration of the portfolio.
curve and the stochastic cash flows are taken into account. On the basis of the
partial durations pertaining to seven representative maturities, a set of cash The duration for the investments is determined on the basis of the ESTER
flows is built that have the same interest rate sensitivity along the curve as curve. As the UFR curve is required by law to be applied to determine the value
the fixed-income investments portfolio itself. The interest rate shock is then of the liabilities, the duration of the liabilities has however been determined on
determined on the basis of this set of cash flows. the basis of the UFR rate curve instead of the ESTER curve.
In the S-test, the interest rate curve at which the liabilities are discounted is The duration for the total investments, excluding interest rate swaps, was 3.4
shocked up and down by a percentage dependent on maturity. The interest years, where the interest effect on assets other than fixed-income investments
rate risk is calculated using the scenario with the worst impact on the pension is not taken into account. A duration extension of the investments by means
fund capital, usually a decline in interest rates. The following examples of of interest rate swaps brings the interest sensitivity more in line with the
shocks dependent on maturity to be taken into account are provided to give an interest rate sensitivity of the liabilities, which reduces the impact of a change
Duration 2021
in € mln Years Market value Impact +1% Impact -1% 2020 in years
Duration of assets (excluding interest rate swaps) 3.4 535,062 -16,416 20,044 3.3
Duration of assets (including interest rate swaps) 5.8 551,753 -27,064 33,325 6.1
Duration of liabilities 19.5 498,797 -84,329 113,337 19.9
in the interest rate on the funding ratio. The duration of the total investment and the extent to which the hedging is evenly distributed between the terms
portfolio, including interest rate swaps, was 5.8 years at year-end 2021. to maturity.
The duration of the liabilities based on the UFR interest rate curve was 19.5
years. The interest rate hedging percentage is determined on the basis of a (S2) Equities and alternative investments risk
different interest rate curve, the Ester, and was about 27% at year-end 2021.
To manage the price risks on investments in equities and alternatives, ABP
The following chart presents the cash flows from the nominal pension liabilities applies a policy of maximum diversification across geographical regions,
in dark blue and the cash flows from the swap portfolio in light blue. The seven investment categories, and sectors. Information on this is contained in the
gray bars present the cash flow from the fixed-income investments portfolio. notes to the company balance sheet. Equities and alternative investments
The individual cash flows of this portfolio are combined into seven maturity make up 60 percent of the assets in the strategic portfolio. This includes the
buckets to simplify the presentation. The combined cash flows result in the category commodities, which accounts for 6 percent but is not part of S2. A
same change of value for S1 as the total of the individual cash flows. The 10 percent price drop affecting equities and alternative investments will reduce
chart also presents the extent to which ABP has hedged the interest rate risk the funding ratio by 6 percentage points. The solvency test assumes a shock
of 30 percent for equities in developed markets, 40 percent for equities in
emerging markets, and 25 percent for unlisted real estate. For unlisted equity
and alternative investments (private equity and infrastructure), the applied
shock is 40 percent. The risks associated with unlisted equity and alternative
Nominal cash flows investments are included in the equities and alternative investments risk
(in € billion) Pension liabilities Swaps Fixed-income investments (S2). Any related unhedged currency risks are included under the heading of
currency risk (S3).
40
30
(S3) Currency risk
20
ABP is exposed to a currency risk as the pension fund also makes investments
10
denominated in foreign currencies in the context of spreading risks, while
0 pensions are payable in euros. The currency risk was mitigated as the largest
foreign currency exposures were partly hedged in 2021 ; the strategic hedging
-10
is 50 percent. In the S-test, a 20 percent shock is applied to the remaining
post-hedging exposure to foreign currencies in developed markets relative to
-20
Maturity 0 years Maturity 20 years Maturity 40 years Maturity 60 years
the euro. A 35 percent shock is applied to the remaining unhedged exposure to At year-end 2021, the strategic currency risk hedging of equities and alternative
foreign currencies in emerging markets relative to the euro. investments denominated in the US dollar, Swiss franc, Japanese yen, Canadian
dollar, Australian dollar, and Pound sterling was 50 percent, except for
The current value of the currency hedging derivatives is presented in the last commodities, for which the currency risk is not hedged. The currency risk,
table in the derivatives paragraph. The following table presents a breakdown of in contrast, of fixed-income investments is fully hedged. A currency hedge
the investments before and after currency hedging. comprises a de facto conversion of an investment in a foreign currency into an
investment in euros.
Analysis of available assets by currency as at year-end 2021
Before After
currency Currency currency
in € mln hedge hedge hedge
(S4) Commodity risk
Currency
The weighting of commodities in the strategic portfolio StIP2022 is 6 percent
Euro 178,208 162,029 340,237
and was largely built up using commodity derivatives, in practice. The active
US dollar 255,919 -143,053 112,866
risk exposure is small, as part is actively mandated. In the S-test, a 35 percent
Sterling 15,219 -6,911 8,308
shock is applied to the market value of the commodities.
Chinese Yuan 15,994 - 15,994
Yen 10,683 -5,768 4,915
Australian dollar 7,865 -3,476 4,389
Korean Won 5,351 - 5,351 (S5) Credit risk
Hong Kong dollar 5,476 - 5,476
Taiwan dollar 6,470 - 6,470 The investment portfolio is exposed to credit risks. Credit risk refers to the
Indian Rupee 5,868 - 5,868 risk that a counterparty is no longer able to meet its payment obligations or
Canadian dollar 4,662 -1,878 2,784 that its financial situation deteriorates. The portfolio rating is an important
Swiss franc 4,240 -2,604 1,636 indicator of the quality of the portfolio. The credit risk is partially hedged with
Other 37,350 - 37,350 credit default swaps. The fixed-income investments portfolio is classified into
five rating classes for the purposes of the S-test. These classes are AAA, AA, A,
Total 2021 553,305 -1,661 551,644 BBB, and, as fifth class, BB or lower.
Total 2020 491,368 3,967 495,335
The AAA rating class is subdivided into European AAA government securities (S7) Liquidity risk
and other AAA. The FTK stress scenario applies a shock on the credit spread
ranging from 0 bp on European AAA government securities and 60 bp on other The liquidity risk is the risk that the fund has insufficient cash to meet its
AAA to 530 bp on securities rated BB or lower. current payment liabilities, including pensions, or to deposit collateral for
derivative positions. ABP's liquidity risk is minimal in normal circumstances
The creditworthiness of investments is usually classified into credit ratings. A because the majority of investments are in cash assets. There were no liquidity
high credit rating indicates that the borrower is extremely creditworthy and it deficits in 2021.
is highly probable that the loan will be redeemed. Credit ratings range from
the highest rating, AAA (extremely creditworthy), to the lowest, D. The spread Investing in illiquid investment categories reduces the flexibility available to the
in fixed-income investments is such that 87 percent (2020: 88 percent) have a pension fund in the periodic rebalancing of the investment portfolio. A fund
rating of BBB or higher (investment grade). forced to sell illiquid assets at short notice will usually be unable to command a
fair price. This is avoided by taking account of the reduced flexibility of illiquid
investment categories in the rebalancing policy.
(S6) Underwriting risk
The following chart presents the monthly cash flow from the interest rate
Retirement pensions and surviving dependents' pensions are payable for life. hedge, currency hedge, contributions, and pensions in 2021. Liquidity problems
Pursuant to the legislation and regulations, the calculation of the provision can arise when the negative cash flows become excessive. The chart shows
for pension liabilities must take account of a foreseeable trend in future that, in 2021, hedging the currency position demanded the most liquidity.
mortality rates. This is carried out using the AG Projection Table 2020 , which
is adjusted using correction factors specific to the pension fund as specified
in the Actuarial Assumptions Study 2017-2019 to obtain a mortality table
specific to ABP. In addition to mortality rates, ABP's actuarial assumptions also
take account of, for example, transfer probabilities, partner frequencies and
incapacity for work estimates. If the mortality rates follow the AG projections,
then the life expectancy at year-end 2021 for a male aged 66 is 86.9 and for
a female aged 66 is 89.1. The future average mortality rates may diverge from
the projection, however, and actual mortality may also differ from average
mortality within a finite population. That leads to uncertainty in the value of
the provision for pension liabilities, which is expressed in S6. The shock applied
in the provision for pension liabilities in the stress scenario, for this and other
underwriting risks, is 2.90% this year.
Liquidity flows allows the operational risk to be set at zero when an increased risk is not an
x € 1 billion
issue. This condition was met in 2021. This statement is based on the reports
5 from the administrative business for the Board of Trustees’ full monitoring of
the administration.
2.5
0 (S10) Active risk
-2.5 The optimum asset mix is determined using the asset and liability management
(ALM) approach. Each investment category is then populated with suitable
-5 assets, with departures from the benchmark being permitted within the
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec predetermined maximum tracking errors, which leads to an active risk. The
tracking errors for the various investment categories are measured with risk
Contributions Pension payments Currency hedge
Interest hedge systems and continually monitored to determine whether they remain within
the set limits. S10 comprises a further component besides the required buffer
for active risk. With effect from the Strategic Investment Plan 2019-2021, ABP
decided to eliminate the strategic allocation to hedge funds and instead to
(S8) Concentration risk adopt a higher strategic weighting to equities in developed markets. This
allocation shift resulted in a decrease in the strategic required funding ratio.
Concentration risk is an issue when a large proportion of the invested assets is ABP is restructuring the portfolio in line with this decision. As this will take
invested with one party or in one investment category. This means the risks are some time, the transition is proceeding gradually and the S10 buffer in
greater than with a balanced spread of investments. The standard model has place has been maintained. In connection with the reduction of the strategic
a concentration risk of zero. With the policy pursued, an increased risk is not minimum capital requirement resulting from the increase in the interest rate
considered to be an issue and there is no need for an additional supplement. hedging percentage from 25 percent to 30 percent as of the start of 2022, this
buffer will be used again in the current year in constructing the StIP 2023-2024.
Around half of the buffer required for S10 is considered to be a buffer that can
(S9) Operational risk be deployed elsewhere in due course, whereas the other half is necessitated by
the willingness to accept active risk.
The operational risk is the risk of errors not being identified sufficiently
promptly due to the incorrect operation of the organization. The Pensions Act
Risk restrictions
Investment risks need to be taken if indexation is to be feasible. These are with the interest rate sensitivity of the future liabilities. This is achieved by
risks in line with the pension fund’s risk appetite that are consciously accepted extending the duration (weighted average maturity of all cash flows) of the
for the purpose of realizing the long-term indexation ambition. Investment fixed-income investments.
risks are limited with risk restrictions in the mandates, and the risk exposure
is continually monitored. Risk limits have been adopted for both the entire A limited portion of the derivatives portfolio is used as an effective means of
portfolio and specific components of the portfolio, such as a maximum creating positions in certain investments or of modifying features of a certain
permitted active risk or a maximum allocation to a specific counterparty. In investment portfolio.
addition to specifying limits and adopting spreads, risks can also be mitigated
with derivative financial instruments, or derivatives. The following table presents the current value of the derivatives (swaps,
futures, options, and forward currency contracts) attributed to the various
investment categories together with the associated asset management overlay
Derivatives effect. The asset management overlay effect of the derivatives and short
positions was €18.7 billion at year-end 2021 (2020: €11.1 billion). The table
ABP uses derivatives to mitigate risks or make rapid tactical changes in the shows that this asset management increased the interest in fixed-income
asset mix. Derivatives are financial instruments with a value partly dependent investments and equities and reduced the interest in other investments.
on one or more underlying financial instruments. Derivatives can be traded
on the stock exchange or directly with players in the financial sector, the
latter group of which are referred to as “over-the-counter” (OTC) derivatives.
ABP makes use of both. Collateral that usually needs to be deposited with
the counterparty when taking a derivative position serves as a form of buffer
for fluctuations in the value and market value of the derivative position. The
collateral comprises cash (or suitable securities), which is deposited with the
counterparty to serve as assurance for the fulfillment of any liabilities when
the value of derivatives fluctuates. Additional deposits or partial withdrawals of
collateral are made, in principle, on a daily basis, as determined by movements
in the position. Derivatives are mainly used to hedge currency and interest
rate risks. As some investments are denominated in foreign currencies, most
of which in US dollars, a portion of the currency risk is hedged to mitigate
exchange rate risks to safeguard cash flows in euros. Derivatives are also
employed to bring the interest rate sensitivity of investments more into line
Balance sheet before and after attributing fair value of derivatives
Balance sheet after Balance sheet after Balance sheet after

Balance sheet at Attributed fair attributing fair Asset management asset management asset management
in € mln fair value value of derivatives value of derivatives overlay effect overlay effect overlay effect
31-12-2021 31-12-2020
Real estate 77,826 -0 77,826 - 77,826 60,721
Equities 228,837 -306 228,531 -16,148 212,383 196,590
Fixed-income investments 219,233 14,247 233,480 -2,588 230,892 216,272
Derivatives: positive positions 34,234 -34,234 - - - -
Other investments 37,257 -942 36,315 18,736 55,051 73,735
Other assets 1,976 - 1,976 - 1,976 1,934
Total assets 599,363 -21,235 578,128 - 578,128 549,252
Pension fund capital 53,607 - 53,607 - 53,607 33,552-

Pension liabilities 498,797 - 498,797 - 498,797 529,865
Investment-related liabilities 43,018 -21,235 21,783 - 21,783 50,165
incl. derivatives and short positions 21,235 -21,235 - - - 287
Other liabilities 3,941 - 3,941 - 3,941 2,774
Total capital and liabilities 599,363 -21,235 578,128 - 578,128 549,252

The following table presents a specification of the various types of derivatives. derivative concerned, with all positions totaled as absolute values (sum of long
The underlying values of the futures and TBAs (to be announced) are based and short exposure). The two largest items are the derivatives employed to
on the net exposure (balance of the long and short exposure). The underlying mitigate the currency risk (forwards) and interest rate risk (interest rate swaps).
values of the other derivatives are based on the underlying notionals of the
Analysis of derivatives by type
in € mln Receivables underlying value Receivables Payables underlying value Payables
Currency derivatives
Forwards 77,739 467 139,105 -2,193
Cross Currency Swap - - - -
Interest rate derivatives

Interest Rate Swaps 211,836 31,723 169,002 -17,034
Inflation-linked swaps 5,739 758 5,180 -1,037
Fixed-income futures 910 98 6,028 -81
TBAs 3,345 7 1,982 -3
Other derivatives 354 14 1,734 -193

Credit Default Swaps 2,604 - 10 -
Other futures 28,163 1,167 15,569 -694
Total derivatives as at year-end 2021 34,234 -21,235

Total derivatives as at year-end 2020 50,431 -24,798
Short positions
A short position is created on entering into the obligation to deliver securities

at a future date without having possession of them at the time of entering into
the obligation, whereby the counterparty risk is mitigated with collateral. The
short positions for investments were zero for 2021, as in the previous year.
Contents Notes to the company balance sheet ABP Annual Report 2021 156
Notes to the company balance sheet

(amounts in millions of euros unless otherwise stated)
General
The pension fund's available assets can be derived from the company balance
sheet by deducting the items of investment-related liabilities, payables and
other liabilities, and specific reserves from the total assets. The funding ratio
is calculated by dividing the available assets by the provision for pension
liabilities. The policy funding ratio, which forms the basis for supervision
of the pension fund, is the 12-month rolling average of the funding ratios.
The calculation of the funding ratio at year-end of the fiscal year is
presented below:
31-12-2021 31-12-2020
Total assets 599,363 574,050

Investment-related liabilities -43,018 -74,963
Other liabilities -3,941 -2,774
Specific reserves -760 -978
Available assets 551,644 495,335

Provision for pension liabilities 498,797 529,865
Funding ratio 110.6% 93.5%
Policy funding ratio 102.8% 87.6%
Assets
1. Investments
Movements in the investments were as follows:
Fixed-income Other
Real estate Equities investments Derivatives investments Total 2021 Total 2020
Opening balance of investments 60,721 206,726 195,859 50,431 58,379 572,116 529,529
Granted/bought 3,924 23,531 109,449 - 1,585 138,489 101,581
Repaid/sold -682 -52,680 -86,783 - -32,597 -172,742 -78,117
Change in value 1
12,429 50,248 -3,829 - 11,358 70,206 8,655
Other movements 1,434 1,012 4,537 -16,197 -1,468 -10,682 10,468
Closing balance of investments 77,826 228,837 219,233 34,234 37,257 597,387 572,116
Of which:
- listed 404,579 369,272
- unlisted 192,808 202,845
1 Including movements up to the time of disposal
Definition investments) has not been accounted for as a purchase, as these are deposits
Investments comprise real estate, equities, fixed-income investments, and derivatives that are not part of the purchase of investments.
derivatives, and other investments, including the associated receivables, cash,
and payables. These can be held directly or indirectly through units in mutual The other movement in derivatives in 2021 is a consequence of the increase in
funds managed by the administrative business. interest rates, leading to a decrease in the value of the interest rate derivatives,
and of a decrease of the US dollar price in euros, leading to a decrease in the
During 2021, ABP withdrew €94 billion from mutual funds. The underlying value of the currency derivatives (in particular, sale of US dollars).
investments were transferred to ABP and are now held directly by ABP.
The withdrawal from the mutual funds is accounted for as a sale, and the The other movement in fixed-income investments increased due to an increase
acquisition of the investments now held directly has been largely accounted for in short-term lending.
as a purchase in the summary of movements in investments. The acquisition
of the directly held investments from the Commodity pool (part of other
The other movements item comprises movements in the receivables, The investment item also recognizes:
cash, payables associated with the investments, and movements in the • investments of €0.2 billion (2020: €0.2 billion) in favor of participants in the
derivative positions. ABP Nettopensioen and ABP ExtraPensioen schemes.
• investments of €3.0 billion (2020: €2.0 billion) in respect of the pre-financing
The closing balance of the investments, €597.4 billion (2020: of the VPL scheme. These investments are managed by ABP and are at
€572.1 billion) includes: the risk and expense of third parties. The movement during the fiscal year
comprises the contributions received, €925 million (2020: €681 million) and
31-12-2021 31-12-2020
a negative return of €18.0 million (2020: €6.2 million).
Receivables, prepayments and accrued income 1,055 1,126
Collateral paid 2,489 901 ABP does not lend out investments.
Short-term lending (including CIS short-term lending) 23,615 43,937
Current account bank balances 1,253 88 Measurement and accounting for look-through for mutual funds
Payables, accruals and deferred income (including debit For the purposes of a meaningful presentation of the carrying value of
balances on bank accounts) -2,450 -458
the units in the mutual funds, these are classified in the underlying
investment categories when possible and in so far as this provides an
Net assets included in current assets 25,962 45,594
improved view. The positive and negative derivative and short-term borrowing
positions included in the value of these units are, in accordance with the
Raad voor de Jaarverslaggeving (Dutch Accounting Standards Board) Richtlijn
The current account bank balances item includes amounts invested in money Pensioenfondsen (pension fund guidelines) (RJ 610), recognized separately
market funds as call money. €491 million of the bank balances is not freely in the balance sheet. The specification of all investments is based on the
disposable (2020: €478 million). This relates to balances held on margin underlying assets, including investments in mutual funds placed with the
accounts in connection with future positions. administration business.
The liabilities recognized in investments comprise debit balances on bank

accounts of €1.2 billion (2020: €1.0 billion).
The specification of the current value by investment category determined with

the underlying measurement method can be presented as follows:
Investment
Fixed-income Derivatives: related Other
in % Real estate Equities investments positive liabilities investments 31-12-2021 31-12-2020
Mark-to-market 40 81 95 8 67 42 75 76
Broker quotes - - - - - - - -
Mark-to-model - - 2 92 33 - 4 6
External estimates 60 19 3 - - 58 21 18
Total 100 100 100 100 100 100 100 100
The classification presented in the above table is based on the methods measured with a model, as daily prices are unavailable, are attributed to the
referred to in the measurement of assets and liabilities sub-section. The “mark-to-model” category.
classification of 92% of the derivatives in mark-to-model is due to the absence • currency forwards are attributed to the “mark-to-model” category.
of stock exchange quotations. These include, for example, over the counter Mortgage-backed securities and asset-backed securities are attributed to
derivatives, even though these can be measured objectively. Within the the “broker quotes” or “external estimates” categories when prices are not
external estimates, 77% are based on independent measurement. supplied by an independent price provider, although securities measured
on the basis of less than three broker quotes are attributed to the “external
The investments were attributed to a measurement method based on the estimates” model category. Mortgage portfolios are attributed to the “mark-
following assumptions: to-model” category.
• net current assets relating to an investment category, including deposits,
repos, receivables, payables, cash, and investments in money market funds, Most measurements of the investment portfolio are therefore based on
are included in the “mark-to-market” category. information from independent data suppliers. Only a small fraction of the
• private equity investments and investments in hedge funds are allocated portfolio is measured with internal models.
to the “external estimates” category. This also applies to investments in
investment funds when the value is provided by an external manager.
Swaps are attributed to the “mark-to-market” category when the price
is supplied by an independent price provider. However, swaps that are
These measurements are brought into line with international (IFRS) accounting • the following listed investments are attributed to level 1: equities, bonds,
standards to provide a clearer insight into the figures. Customary IFRS practice options, futures, money market funds, and cash ;
is to attribute the fair value hierarchy of investments based on the following • the following investments are attributed to level 2: investments priced
three levels: based on Markit or similar price providers, investments priced on the basis
• level 1, direct quoted market prices: investments with quoted prices for of at least three broker quotes, and investments measured with a model
identical assets or liabilities in active markets; administered by the manager using observable market data. The following
• level 2, derived market prices: investments other than level 1 investments are also attributed to level 2: deposits, repos, receivables and payables,
measured using inputs comprised of observable data in the market; currency forwards, listed lookalike options, futures, and similar. Investment
• level 3, valuation models and techniques: investments measured with a funds are also attributed to level 2 when units in that fund can be sold back
measurement model using input comprised of significant unobservable to the fund at least once a quarter and at the reported price;
input data. • investments not attributed to level 1 or 2 are attributed to level 3. These
are mainly closed end funds in illiquid investments with units that cannot be
The combination of the measurement matrix in the previous table with the bought back before maturity.
fair value hierarchy as used in international practice is presented in the
following table.
The attribution of investments to levels is based on the following assumptions

and principles:
• investments in a mutual fund are attributed to a level, not the mutual
fund as such. If the investment is in another investment fund, then that
investment fund is attributed to a level;
• both investments and the receivables, payables, and cash are allocated;
Direct quoted Valuation models

in % market prices Derived market prices and techniques Total
Mark-to-market 98 2 - 100
Broker quotes - - - -
Mark-to-model - 100 - 100
External estimates - 8 92 100
Total 2021 74 7 19 100

Total 2020 75 8 17 100
Specifications
The following tables present specifications of the investments by class, region,
and currency (all in million euros). The currency table does not include
the derivative item, as this is presented in a separate table together with
derivatives with a negative current value and short positions.
Investments by category
Fixed-income Derivatives: Other
Real estate Equities investments positive investments 31-12-2021 31-12-2020
Basic materials 17 11,167 1,001 285 1,766 14,236 14,785

Mortgages etc. - - 17,805 7 - 17,812 17,791
Real estate 50,318 4,314 662 - - 55,294 45,034
Utilities 529 4,289 3,276 - - 8,094 8,312
Telecommunications 2,381 4,455 4,540 - - 11,376 10,502
Healthcare 224 23,309 3,454 - 20 27,007 26,393
Luxury goods 1,872 26,829 3,830 - 4 32,535 33,311
Energy 8,026 5,334 2,656 508 677 17,201 16,306
Manufacturing 12,481 22,584 4,104 - - 39,169 34,423
Financial institutions 716 43,891 27,816 33,040 33,042 138,505 158,673
Convenience goods - 14,577 1,810 296 932 17,615 18,039
Information technology 685 67,973 1,630 - - 70,288 59,159
Public authorities 577 115 146,649 98 816 148,255 129,388
Total investments 77,826 228,837 219,233 34,234 37,257 597,387 572,116

Investments by region
Netherlands 4,688 6,548 15,190 3,258 4,210 33,894 49,622

Rest of EMU 17,950 21,465 88,404 29,527 6,772 164,118 160,160
Rest of Europe 13,333 21,119 23,328 753 3,605 62,138 62,114
North America 25,509 126,861 67,266 684 19,693 240,013 207,445
Asia/Pacific 15,030 49,384 13,997 12 2,379 80,802 77,604
Other 1,316 3,460 11,048 - 598 16,422 15,171
The investments in the Netherlands have decreased because the deposits of the APG Commodities Pool with APG Liquiditeitenbeheer are no longer included due to
the transfer of the investments to ABP.
Investments by currency, excluding derivatives

Fixed-income Other
Real estate Equities investments investments 31-12-2021 31-12-2020
Euro 24,472 27,616 111,589 14,732 178,409 161,320

US dollar 28,167 127,288 74,179 18,732 248,366 231,253
Sterling 8,270 8,110 12,390 496 29,266 25,258
Chinese Yuan 1,318 12,787 1,701 2 15,808 17,741
Yen 847 9,736 -2 811 11,392 12,665
Australian dollar 4,027 2,800 1,313 1,265 9,405 8,616
Taiwan dollar - 6,471 - - 6,471 6,092
Hong Kong dollar 4,321 1,324 - 164 5,809 5,870
Indian Rupee 730 4,976 135 10 5,851 5,128
Canadian dollar 238 3,438 1,373 382 5,431 5,007
Korean Won - 5,222 80 3 5,305 4,986
Swiss franc 259 3,736 30 193 4,218 4,307
Other 5,177 15,333 16,445 467 37,422 33,442
Total investments 77,826 228,837 219,233 37,257 563,153 521,685
The division between “Derivatives positive” and “Derivatives negative” in the currency table is partly influenced by the currency hedging positions. These positions are a
snapshot. A forward currency contract is a contract to buy or sell a given amount of a currency at an agreed exchange rate on an agreed future date. Buying increases
the currency position and selling decreases the position. Both positions are presented in the above table. The final balances are in part dependent on exchange rate
movements since the conclusion of the contract.
Derivatives and short positions by currency

Derivatives
Derivatives positive negative Short positions 31-12-2021 31-12-2020
Euro 97,190 84,885 - 182,075 179,842

US dollar -57,050 -75,391 - -132,441 -118,838
Sterling 805 -21,356 - -20,551 -18,608
Chinese Yuan 223 -38 - 185 250
Yen -5,516 -804 - -6,320 -6,441
Australian dollar -2,128 -2,814 - -4,942 -4,831
Taiwan dollar -1 - - -1 1
Hong Kong dollar -323 145 - -178 -27
Indian Rupee 17 - - 17 -
Canadian dollar 989 -3,617 - -2,628 59
Korean Won 20 28 - 48 -3,280
Swiss franc -235 -2,289 - -2,524 -2,924
Other 243 16 - 259 143
Total investments in derivatives and short positions 34,234 -21,235 - 12,999 25,346
Notes on the individual investment categories Equities investments comprise:

Real estate investments encompass investments in:
Investments in equities
31-12-2021 31-12-2020
Real estate investments and infrastructure investments
31-12-2021 31-12-2020 Developed markets 141,208 132,966
Residential property 14,783 12,110 Emerging markets 39,747 41,230
Offices 7,165 3,682 Private equity 44,339 31,286
Retail property 10,551 9,493 Other 3,543 1,244
Industrial buildings 12,469 8,827
Hotels 2,200 1,464 Total investments in equities 228,837 206,726
Other 9,253 8,783
Total investment properties 56,421 44,359

The investments in equities relate to €17.4 billion (2020: €2.8 billion) in the
Industrial companies 8,938 7,662
name of ABP and investments of €211.4 billion (2020: €204.0 billion) in the
Energy 8,026 5,523
mutual fund through the administrative business.
Telecommunications 2,381 1,377
Other 2,060 1,800
Private equity investments relate, in particular, to equities in unlisted
companies in sectors including the venture capital sector. The private equity
Total infra investments 21,405 16,362
investments comprise indirect investments of €37.1 billion (2020: €27.0 billion)
and direct investments of €7.2 billion (2020: €4.3 billion).
The real estate investments comprise €3.7 billion in the name of ABP (2020:
€3.2 billion) and investments of €74.1 billion in the mutual fund through the
administrative business (2020: €57.5 billion).
The “Other” item includes other real estate investment assets and liabilities
totaling €0.7 billion (2020: €0.4 billion).
Fixed-income investments comprise: The breakdown of the fixed-income investments item by coupon rate is
as follows:
31-12-2021 31-12-2020
Fxed-income investments by coupon rate
Government bonds 140,295 119,714 31-12-2021 31-12-2020
Corporate bonds 45,773 42,915 < 0% 1,088 11,389

Mortgage loans 14,884 15,164 0%-1% 52,315 32,496
Mutual funds 7,359 5,775 1%-2% 38,819 36,934
Index bonds 767 4,755 2%-3% 34,118 31,998
Private loans and bank loans 3,061 2,689 3%-4% 28,180 29,581
Other investments 1,104 442 4%-5% 31,061 24,356
Other assets and liabilities 5,990 4,405 > 5% 26,293 23,331
no coupon 7,359 5,774
Total fixed-income investments 219,233 195,859
Fixed-income investments comprise investments of €198.4 billion (2020:

€116.1 billion) in the name of ABP and investments of €20.9 billion (2020: The remaining term to maturity of the fixed-income investments as determined
€79.7 billion) in the mutual fund through the administrative business. by the contractual redemption dates is as follows:
The short position of investments in the name of ABP was €0 million at year- Fixed-income investments analyzed by maturity
31-12-2021 31-12-2020
end 2021 (2020: €287 million). The balance at year-end 2021 is recognized
under the investment-related liabilities balance sheet item. Shorter than one year 9,421 5,007
Between one year and five years 38,147 40,337
Longer than five years 164,306 144,741
No maturity 7,359 5,774

The creditworthiness of fixed-income investments is usually expressed in terms The breakdown of derivatives with a positive current value is as follows:
of a credit rating. The ratings of the fixed-income investments are as follows:
Breakdown of derivatives
31-12-2021 31-12-2020
Fixed-income investments rating analysis
No Currency derivatives
AAA AA A BBB <= BB rating Total
Forward currency contracts 467 3,421
2021 33% 28% 11% 14% 11% 3% 100%
2020 33% 28% 11% 15% 10% 3% 100% Interest rate derivatives
Interest Rate Swaps 31,723 43,476
Inflation linked swaps 758 1,487
Fixed-income futures 98 24
This table shows that 72% (2020: 72%) of the fixed-income investments have a
TBAs (to be announced) 7 25
rating of A or higher.
Other derivatives
The duration of fixed-income investments is often used to provide an insight
Credit default swaps 14 5
into the cash flows. The duration is the average weighted maturity of all
Other futures 1,167 1,993
cash flows (interest and principal redemptions) relating to the fixed-income
products. The duration of the fixed-income investments is approximately10
Total derivatives with positive fair value 34,234 50,431
years (2020: approximately 9 years).
Negative derivative positions are presented on the liabilities side of the balance
sheet, in accordance with the Richtlijnen voor de Jaarverslaggeving (Dutch
Accounting Standards).
The current value of derivatives is greatly dependent on factors including

prices/exchange rates and interest rates at year-end as compared with the
prices/exchange rates and interest rates at the time the derivative positions
were opened.
Other investments 2. Other assets

31-12-2021 31-12-2020
Other investments 37,257 58,379 31-12-2021 31-12-2020
Participating interests 473 427

Tangible assets 41 62
Other investments comprise €37.0 billion (2020: €37.8 billion) in the name Receivables, prepayments and accrued income 1,186 1,147
of ABP and investments of €0.2 billion (2020: €20.5 billion) in the mutual Cash 276 298
fund through the administrative business. The other investments have

Total other assets 1,976 1,934
decreased because the deposits of the APG Commodities Pool with APG
Liquiditeitenbeheer are no longer included due to the transfer of the
investments to ABP.
The cash item includes current account bank balances. The full amount of the
Other investments relate primarily to investments in hedge fund strategies cash is at ABP's disposal. No other collateral has been furnished.
of €17.7 billion (2020: €16.8 billion). This item also includes investments
of €3.9 billion in commodities (2020: €2.1 billion). The carrying amount of The participating interests item relates to the direct interest in APG Groep NV.
other assets and other liabilities relating to investments included in Other The movements in the participating interests item were as follows.
investments was €15.7 billion (2020: €39.5 billion).
Participating interests
Total 2021 Total 2020
The short position of investments in the name of ABP was €0.0 at year-end
2021 (2020: €0.0) and is recognized under the investment-related liabilities Opening balance 427 512
balance sheet item. Change in value 115 74
Dividends paid -69 -76
Capital reduction - -83
Closing balance 473 427

The tangible assets comprise:
Tangible assets
31-12-2021 31-12-2020
Total buildings and fixtures 41 62
The tangible assets item includes both property with an estimated economic
life of 30 years and plant and equipment with an estimated economic life of
15 years.
Additional depreciation was applied to one property in 2021.
The receivables, prepayments, and accrued income comprise:
Receivables, prepayments, and accrued income

31-12-2021 31-12-2020
Receivables from employers 940 895

Receivables in respect of value transfers 178 171
Receivables from participants 2 2
Other receivables 66 79
Total receivables, prepayments and accrued income 1,186 1,147
The receivables contain no receivables becoming due and payable after more
than one year (2020: none).
Capital and liabilities obligates pension funds to hold capital in excess of the minimum capital
requirement. ABP's standard minimum capital requirement equates to 4.2%
3. Pension fund capital of the provision for pension liabilities (2020: 4.2%). The minimum capital
requirement at the end of the fiscal year was €21.0 billion. A comprehensive
Specific General
explanation of ABP's position with respect to the capital requirement and
reserve reserve Total
minimum capital requirement is included in the Risk section.
Opening balance 2020 1,060 -10,711 -9,651
Added from result - - -
An updated recovery plan submitted on March 31, 2022 shows that the
Utilized -82 -23,819 -23,901
capital requirement can be met within the prescribed term. No supplementary
measures are required in 2022.
Closing balance 2020 978 -34,530 -33,552
The following specific reserve is recognized at the end of the fiscal year: the
Opening balance 2021 978 -34,530 -33,552
specific reserve for the purchase of conditional pension, €760 million (2020:
Added from result - 87,377 87,377
€978 million). Use of this specific reserve for conditional additional pension
Utilized -218 - -218
purchase depends on the retirement behavior of participants in this scheme.
Closing balance 2021 760 52,847 53,607 €218 million was withdrawn in 2021.
This specific reserve is not taken into account in the calculation of the
funding ratio.
The pension fund capital comprises the specific reserve and general reserve.
The general reserve is not only a source of funding for any setbacks but is also Appropriation of the result
a funding source for future indexation. The Annual Report was adopted on April 28, 2022 by the Board of Trustees of
the Stichting Pensioenfonds ABP.
Pension funds, pursuant to the Financial Assessment Framework (FTK), are
obligated to meet a capital requirement that is set based on the pension fund's It was determined that €218 million of the appropriation of the result be
risk exposure. The capital requirement at year-end 2021 was €131.2 billion, withdrawn from the specific reserves and the remaining €87.4 billion be added
which equates to 26.3% of the provision for pension liabilities. The law also to the general reserve.
4. Provision for pension liabilities
Pension schemes
OP/NP AOP Risk Participants Total 2021 Total 2020
Opening balance 527,934 1,833 98 529,865 476,330

Add:
- pension accruals 20,243 303 - 20,546 17,374
- change in respect of value transfers 211 - - 211 62
- other movements 1,435 14 19 1,468 1,366
Total additions 21,889 317 19 22,225 18,802
Less:
- utilized for pension -12,670 -194 - -12,864 -12,439
- utilized for expenses -101 -4 - -105 -96
- added interest -2,832 -10 - -2,842 -1,551
- result on actuarial assumptions -737 35 - -702 -928
- change in market interest rate -34,147 -73 - -34,220 63,195
- change in actuarial assumptions -2,568 8 - -13,448
Total deductions -53,055 -238 - -53,293 34,733
Closing balance 496,768 1,912 117 498,797 529,865

- of which, proprietary risk 498,680 529,767
- of which, participants' risk 117 98
The provision for pension liabilities is calculated based on the nominal interest The provision for pension liabilities includes the effect of the transitional
rate term structure published by DNB, using the ultimate forward rate (UFR) arrangements at the time of the privatization of ABP (OPA). This provision is
method. The substitution interest rate derived from the interest rate curve was part of the neutral conversion of all existing and future pension rights carried
0.57% percent (2020: 0.19% percent). The effect of the first step of the UFR out on the transition from the ABP Act to the ABP pension scheme. The
change results in an increase in the provision of €6.8 billion as of January 1, annual update of the actuarial assumptions for the provision for the ABP (OPA)
2021 and is part of the movement in Effect of Interest Term Structure. privatization transitional rights, based on the pension fund's observations for
2020-2021, has resulted in an increase in the provision for pension liabilities of
€0.13 billion (2020: €0.03 billion).
The provision for participant's risk comprises €0.1 billion for ABP ExtraPensioen contributions. The contribution to the ABP ExtraPensioen scheme is presented
(2020: €0.1 billion) and €13 million for ABP net pension scheme (2020: under the provision for the pension fund's risk and totaled €0.1billion at the
€13 million). The net pension scheme liability toward the participants is equal end of the fiscal year (2020: €0.1 billion).
to the value of the investments made for them at their risk and expense. The
amount of €0.1 billion relating to the ABP ExtraPensioen scheme presented The closing balance of the provision for pension liabilities relates to the
as participant's risk (2020: €0.1 billion) concerns the return obtained on the following categories:
Provision for pension liabilities

OP/NP AOP Participants' risk 31-12-2021 31-12-2020
Participants 253,731 - 117 253,848 266,178

Former participants 42,611 - - 42,611 45,564
Pensioners 200,426 1,912 - 202,338 218,123
Total provision for pension liabilities 496,768 1,912 117 498,797 529,865
The scheme for professional military personnel accounted for €13.9 billion purchased pro rata. Occupational disability pensions based on the Wet op
of the retirement pension/surviving dependents' pension (OP/NP) pension de arbeidsongeschiktheidsverzekering (WAO, Invalidity Insurance Act) and the
liabilities of €497 billion (2020: €14.7 billion). The cost supplement to cover Wet werk en inkomen naar arbeidsvermogen (WIA, Work and Income (Capacity
costs relating to the future granting of pensions and pension payments for Work) Act) are presented under occupational disability pension (AOP). This
included in the provision totaled €2.6 billion (2020: €2.7 billion). The collection relates to invaliditeitspensioenen (IP, invalidity pension), herplaatsingstoelagen
costs are covered by supplements factored into the contributions. (HPT, redeployment allowance) and ABP occupational disability pensions
(AAOP). An explanation of the movements in the provision for pension liabilities
The Board of Trustees has set indexation for 2022 at 0% due to the pension is included in the note to the company statement of income and expenses.
fund's financial position on October 31, 2021. This is applicable both to
payable and non-contributory pensions and to pensions being accrued by
participants. Inflation in the period from September 1, 2020 through August
31, 2021 was 2.39% (reference date August 31, 2021). The Wet Vervroegd
pensioen en levensloop (VPL, legislation on the pre-pension and life-course
savings scheme) provision for pensioners is recognized in the OP/NP category.
The rights to retirement pension to be purchased are accrued only once
they have been funded. Rights to a partial pension on retirement are
5. Investments-related liabilities The negative derivative positions can be specified as follows:
31-12-2021 31-12-2020
Derivatives with negative fair value
Collateral received 14,977 25,920 31-12-2021 31-12-2020
Short positions - 287 Currency derivatives

Short-term borrowing 6,806 23,958 Forward currency contracts 2,193 540
Derivatives 21,235 24,798 Cross currency swaps - 1
Total investment-related liabilities 43,018 74,963 Interest rate derivatives

Inflation linked swaps 1,037 2,540
Short-term borrowing of €6.8 billion (2020: €24.0 billion) included €0.0 billion
TBAs 3 3
in repos (2020: €0.0). Repos relate to bonds and index-linked bonds. A fee
is charged for entering into repos. Cash is temporarily obtained to invest
Other derivatives
in accordance with strict guidelines for the purpose of generating additional
returns to cover the non-return risk.
Other futures 694 353
Collateral received relates to surety for derivative transactions. Total derivatives with negative fair value 21,235 24,798
The short positions are specified as follows:
Short positions Negative derivative positions are presented on the liabilities side of the balance
31-12-2021 31-12-2020
Fixed income investments - 287 Accounting Standards). The current value of the derivatives item is dependent
Other investments - 0 on factors including prices/exchange rates and interest rates at year-end as
compared with the prices/exchange rates and interest rates at the time the
Total short positions - 287 derivative positions were opened. A further explanation is given in the note to
derivatives with a positive value.
6. Other liabilities The liability in respect of purchased conditional pensions of €2,951 million
(2020: €2,044 million) relates to the payable to the employers’ and employees’
31-12-2021 31-12-2020
organizations arising from the prefunding received and the return on the
Payables in respect of pensions 345 350 associated risk-free investments. The prefunding relates to the spread of the
Liability in respect of purchased conditional pensions 2,951 2,044 premium over several years before the peak in the purchases with regard to
Other payables 645 380 the VPL in 2022. The movement in the fiscal year comprises:
Total other liabilities 3,941 2,774 Development of liability in respect of purchased conditional pensions
31-12-2021 31-12-2020
The other liabilities recognize items, as part of the other payables, becoming As at January 1st 2,044 1,369
due and payable after more than one year to a total of €326 million (2020: Contributions received 925 681
€23 million). Return -18 -6
The payables in respect of pensions include tax and social security As at December 31 2,951 2,044
contributions totaling €326million (2020: €320 million).
The funding structure between ABP and Defense was settled in 2021. The
amount outstanding at the start of 2021 was €4 million. This liability related to
ABP’s implementation of the capital pension scheme for military personnel.
Off balance assets and liabilities An intraday facility has been taken out with ABN-AMRO Bank NV to a total
of €6.3 billion (2020: €1.2 billion). An intraday facility has also been taken
Liabilities arising from committed investments out with ING to a total of €0.5 billion (2020: €0.5 billion). These facilities
Liabilities not presented in the balance sheet and assets not presented in had not been drawn at year-end 2021. No collateral was furnished for these
the balance sheet relate to commitments entered into in connection with the agreements/facilities.
investments which relate to capital interests in investment subsidiaries and
mutual funds managed by the administrative business. Liabilities have been entered into for other investments totaling €2.9 billion
(2020: €3.1 billion).
Liabilities entered into for real estate investments totaled €11.5 billion on the
balance sheet date (2020: €9.5 billion). Other liabilities
A long-term contract has been concluded with the APG Groep NV
Liabilities relating to shares have been entered into for private equity administrative business for services comprising support for the Board of
investments to make deposits on request. These liabilities totaled €17.8 billion Trustees, pension management and communication, and asset management
on the balance sheet date (2020: €20.0 billion). in the context of the administration of the pension schemes. APG Groep NV has
in turn outsourced the activities to its APG DWS en Fondsenbedrijf NV and APG
Liabilities entered into for investments in investment funds totaled €2.5 billion Asset Management NV subsidiaries.
on the balance sheet date (2020: €2.4 billion).
A fiscal entity comprising ABP, APG Groep NV, and APG Groep NV subsidiaries
Securities furnished as collateral were €0.0 billion (2020: €0.0), and and second-generation subsidiaries has been formed for turnover tax
securities received as collateral were€0.0 billion (2020: €0.0). Securities purposes. The companies in this fiscal entity are jointly and severally liable for
totaling €0.4 billion (2020: €0.0 billion) were received as collateral (bilateral their tax liabilities.
initial margin).
Securities totaling €3.0 billion have been deposited as initial margin (2020:
€1.0 billion), and securities totaling €0.4 billion have been furnished as
collateral (bilateral initial margin) (2020: €0.0). Securities received from repos
totaled €0.9 billion (2020: €3.8 billion), and securities delivered for repos
totaled €0.0 billion (2020: €0.0 billion). Cash posted for initial margin relating
to derivatives totaled €0.5 billion (2020: €0.5 billion).
Contents Notes to the company statement of income and expenses ABP Annual Report 2021 176
Notes to the company statement of income

and expenses
Income
7. Pension contributions (net) Gross contributions increased by approximately 8% in 2021 from 2020. The
OP/NP contribution rate was1%point higher than in 2020. The increase in gross
Contributions by category contributions was largely due to this increase in contributions.
Totaal Totaal
OP/NP AAOP 2021 2020
The cost mark-up on the contributions serves in part to cover the collection
costs. The collection mark-up on OP/NP contributions was 0.25% of the OP/NP
Werkgeversdeel 8.884 212 9.096 8.476
contribution base in 2021 (2020: 0.25%).
Werknemersdeel 3.533 91 3.624 3.265
The pension fund had 3,468 affiliated employers/sub-employers at year-end

Totaal
2021 (2020: 3,557) who pay the full contribution, including the employees’
premiebijdragen (bruto) 12.417 303 12.720 11.741
share. The total of the pension fund's contributions relates to the actual
Af: kostenopslag in de premie -116 -110
contribution set for the reporting year plus an estimate of the contribution yet
Premiebijdragen (netto) 12.604 11.631 to be set for the reporting year and the finalized difference between estimates
Premie (in %) 25,90 0,80 as compared with the preceding reporting year. The pension fund did not grant
any contribution discounts in the meaning of the Pensions Act in 2021.
The above table presents a breakdown of the contributions from affiliated The Pensions Act prescribes the quantification of the actual contribution, the
employers and employees. It also states the contribution rates. These relate moderated cost-covering contribution, and the unmoderated cost-covering
to what is referred to as the “moderated cost-covering cushioned contribution” contribution. The unmoderated contribution is calculated based on the interest
plus any contribution mark-ups or mark-downs due, for example, to a recovery rate term structure published by DNB, which corresponds to an average
plan or contribution discounts. nominal discount rate at the start of the year of 0.19% (2020: 0.74%).
The composition of the contributions referred to above is:
Composition of contributions
Damped, cost- Undamped, cost-
Actual covering contributions covering contributions
a. portion for vested liabilities 7,018 7,018 19,870

b. pension administration cost markup 116 116 116
c. solvency margin markup 1,810 1,810 5,126
d. portion for contingent liabilities (indexation) 2,558 2,558 -
e. markups/markdowns on the damped, cost-covering contributions 342 - -
Total amount of contributions 2021 11,844 11,502 25,112

Total amount of contributions 2020 10,843 8,190 20,975
The table shows that the actual contribution in 2021 was higher than the The comparison of the various portions of the contribution shows the effect of
moderated cost-covering contribution and lower than the unmoderated cost- damping and the effect of taking (with the moderated approach) or not taking
covering contribution. (with the unmoderated approach) account of expected investment yields.
The actual contributions presented in the table differ from the net contribution The minimum contributions to be received equate to the moderated cost-
revenue item. The difference is explained in more detail in the table below: covering contribution plus the recovery mark-ups. The actual contributions are
equal to this.
Alignment of contributions
The contribution portion for vested liabilities (a) for both the actual and
moderated cost-covering contribution is based on the expected long-term
Pension contributions (net) 12,604 11,631
nominal investment return, equivalent to a substitution interest rate of 4.2%.
Actual contributions 11,844 10,843
Difference 760 788

Regarding:
VPL purchase contributions 850 823
Collection cost supplements in contributions -116 -110
Other 26 75
The pension administration cost mark-up portion (b) relates to the supplement percentage point contribution surcharge in 2021. The contribution surcharge is
to the contribution to cover collection costs. The coverage for costs incurred also part of (e).
in granting pensions and paying pensions is included in the portion for vested
liabilities (a). 8. Investment results (net)
The direct results are nominal interest yields and dividends. The pension fund
The solvency margin mark-up portion (c) is based on the required funding is exempt from dividend tax The indirect results relate to the actual movement
ratio for the strategic investment mix at the start of 2021. The solvency margin in the value of investments, including exchange rate results. The costs relate
mark-up is 25.8% of the portion for vested liabilities (a). to the total of the invoiced costs of the investments in the name of ABP,
the asset management costs invoiced by the administrative business, and the
The portion for contingent liabilities (indexation) (d) for both the actual and costs of the Board of Trustees. When the costs are distributed between the
moderated cost-covering contribution comprises the difference between the various investment categories, those costs that are not directly attributable
valuation of the pension accruals and risk cover based on the real yield curve to an investment category are attributed pro rata the invested capital. The
(equivalent to a substitution interest rate of 2.3 percent), on the one hand, financial statements present solely the invoiced costs. Non-invoiced costs are
and the valuation of those same components based on the expected long-term netted in the investment results. An explanation of the total of these costs is
nominal investment return plus the solvency margin mark-up, as included in included in the Asset management costs section of the Report of the Trustees.
the portions (a) and (c), on the other.
The transaction costs are netted off against the investment results in the
The mark-ups/mark-downs on the moderated, cost-covering contributions financial statements. The transaction costs totaled €539 million in the fiscal
portion (e) comprise the difference between the moderated contributions year (2020: €532 million). A further specification of the transaction costs is
based on the real yield curve of 2.3 percent and the actual contribution on the included in the Asset management costs section of the Report of the Trustees.
basis of an estimated real return of 2.4 percent. In addition, ABP applied a 1.5
Investment results (net)

Fixed-income
Real estate Equities investments Derivatives Other investments 2021 2020
Direct results 812 1,110 5,083 2,318 128 9,451 7,936

Indirect results 12,543 50,248 -3,786 -21,717 10,290 47,578 23,161
Asset management costs -155 -250 -121 -3 -80 -609 -475
Total investment
results (net) 13,200 51,108 1,176 -19,402 10,338 56,420 30,622
The result on derivatives by type of derivative is presented below.
Result on derivatives
2021 2020
Interest rate derivatives -5,864 5,326

Currency derivatives -11,964 8,627
Other derivatives -1,571 535
Total result on derivatives -19,399 14,488
The loss on derivatives in 2021 is due to an increase in the interest rate as a

result of which the interest rate derivatives fall in value, a decrease in the US
dollar price in euros as a result of which the currency derivatives (in particular,
sale of US dollars) decrease in value, and an increase in the future price as a
result of which the liability arising from the short position in futures increases.
Expenses 10. Movements in provision for pension liabilities

9. Pension payments
Pension accruals -20,546 -17,374
Pensions by type Added interest 2,842 1,550
Total 2021 Total 2020 Utilized for pensions 12,864 12,439
OP/NP -12,654 -12,114 Result on actuarial assumptions 702 928
AOP -254 -268 Utilized for pension administration costs 105 96
Change in market interest rate 34,220 -63,194
Number of recipients as at year-end: Change in actuarial assumptions 2,560 13,449
OP/NP 927,350 895,949 Change in respect of value transfers -211 -62
AOP 47,422 47,369 Other movements in provision for pension liabilities -1,468 -1,367
Total movements in provision for pension liabilities 31,068 -53,535
The pension payments item relates to ouderdoms- en nabestaandenpensioen

(OP/NP retirement pensions and surviving dependents' pensions) and
arbeidsongeschiktheidspensioenen (AOP, occupational disability pensions) The movements in the provision for pension liabilities are explained by
(AOP comprising arbeidsongeschiktheidspensioen (AAOP, ABP occupational component below.
disability pensions), invaliditeitspensioenen (IP, invalidity pension), and
herplaatsingstoelagen (HPT, redeployment allowance). Pension accruals
The pension accruals item reflects the effect of one year's additional service,
continuation of active service on incapacity for work, and death on the nominal
pension liabilities.
Added interest
The value of the pension liabilities not only increases annually with pension
accrual and indexation, when applicable, but also with the accrual of interest.
The interest accrual in the reporting year is calculated based on the one-year
interest rate from the nominal interest term structure at year-end of the
previous fiscal year, which was -0.53% (2020: -0.32%).
The negative one-year interest rate from the nominal interest term structure provision of €6.8 billion as of 1 January 2021 and is part of the movement in
at year-end of the previous fiscal year reduced the pension fund's liabilities. Effect of Interest Term Structure.
Therefore, when this interest rate is negative, the added interest is in
effect revenue. At the aggregate level, the movement in the interest rate term structure leads
to a decrease in the provision for pension liabilities.
Utilization for pensions
The provision for pension liabilities is determined based on actuarial Change in actuarial assumptions
calculations of the fair value of expected future pension payments which take The change in actuarial assumptions items relates to the following
account of the result on actuarial assumptions. The sum determined with this financial effects:
actuarial calculation is withdrawn from the provision each year to fund the • The transition to the new assumptions from the most recent Actuarial
actual pension payments in that year. Assumptions Study 2017-2019 (GO1719) leads to a €2.7 billion decrease
in the provision for pension liabilities. This decrease is mainly because
Result on actuarial assumptions a higher mortality rate of the surviving dependents and the partner,
The result on actuarial assumptions largely comprises the item “result on respectively, is taken into account in the valuation of surviving dependents’
actuarial assumptions”. pension. This amount also reflects the transition to new flex factors
(for advancement and deferral of pension). The new flex factors were
Utilization for pension administration costs determined on the basis of a discount rate of 2.2 percent (2020: 2.4 percent)
The pension administration costs incurred in granting pensions and paying and the new GO1719 assumptions.
pensions are funded by utilizing part of the provision. Utilizations during 2021 • Updating the R/N factors leads to a €0.1 billion increase in the provision
were governed by the mark-ups as specified in the Grondslagenonderzoek for pension liabilities. ‘An R/N factor (or Real/Notional) is the ratio
(Actuarial Assumptions Study) 2014-2016, pursuant to which the OP/NP between the actual annual payments to Appendix K and the notional
payment mark-up was 0.30% (2020: 0.30%) of the provision for pension claims. These claims are termed notional claims because, by contrast to
liabilities, the cost of granting pensions mark-up was 0.35% (2020: 0.35%) of regular retirement pension (OP)/ surviving dependents’ pension (NP) claims,
the provision for deferred pension liabilities, the occupational disability pension participants do not accrue claims for Appendix K. That is because the
collection mark-up was 0.00% (2020: 0.00%) and the payment mark-up was amount of the supplement depends in part on the concurrent or other
2.30% (2020: 2.30%) of the provision for occupational disability pensions. service in the period up to 1995. This period of service is converted into a
‘notional claim’ to enable valuation of the provision for Appendix K on the
Movements in market interest rate basis of fair value factors.
The interest rate term structure at year-end 2021 as published by DNB
corresponds to a nominal interest rate of 0.57%. The interest rate term
structure at year-end 2020 corresponded to a nominal interest rate of 0.19%.
The effect of the first step of the UFR change results in an increase in the
Movements in respect of value transfers 12. Value transfers
2021 2020 2021 2020
Value transfers out 30 66 Value transfers In 284 126

Value transfers in -241 -128 Value transfers out -42 -45
Total change in respect of value transfers -211 -62 Total net value transfers 242 81
Other movements in provision for pension liabilities Both the value transfers in and the value transfers out increased in comparison
The Other movements are primarily due to: with 2020 . From November 1, 2021 , ABP's funding ratio once again allowed
• Improved actuarial valuation due to the transition to Jaarwerk Vernieuwing individual value transfers in and value transfers out. However, the funding ratio
(Innovation of Year-end Reporting). This leads to an increase in the is not relevant for value transfers in and value transfers out for small pensions
provision for pension liabilities by approximately €0.8 billion. of between €2 and €503.24 gross a year, and value transfers in and out are
• New claims arising from the Grip on Data project. This leads to an increase therefore permitted even when the funding ratio is too low to allow regular
in the provision for pension liabilities by approximately €0.2 billion. value transfers.
• Administrative (retroactive-effect) adjustments lead to an increase of the
provision by around €0.2 billion.
11. Collection cost supplements in pension contributions
2021 2020
Collection cost supplements in contributions 116 110
The collection cost supplements in pension contributions serves to fund the

collection costs. The collection mark-up on OP/NP contributions was 0.25% of
the OP/NP contribution base (2020: 0.25%).
13. Pension administration costs (net) Executive Office Management

Staff pension
2021 2020 and other Total Total
Salary pension charges 2021 2020
Salaries (including social security charges) -8 -8
H.J. van Wijnen1 233,090 49,155 282,245 161,263
Pension charges -1 -1
R.L.S. Verjans 219,936 54,764 274,700 265,820
Other staff costs -1 -1
Depreciation -16 -5
Third-party services, pension administration -145 -131 1 since 5-1-2020
Third-party services, asset management -493 -409
Third-party services, other -20 -27
Mr. van Wijnen received an additional fee of €30,000 for the year 2021
Other operating expenses -8 -7
as coordinator on the way to a reversed-mixed governance model (OGM).
Payroll and other pension charges also include the employer's social
Subtotal -692 -589
security contributions.
Less: income from work on behalf of third parties 15 25
Less: attributed to asset management costs 521 423
The average number of staff was:
Pension administration costs (net) -156 -141

Average numbers of employees
2021 2020
Full-time equivalents 41 42
The salaries and pension charges include the amounts paid to the Executive Individual employees 42 43
Office Management in 2021. The other operating expenses relate primarily to
accommodation and regulatory costs.
The staff participate in ABP's pension scheme. ABP, in its role as employer, is
not obligated to pay supplementary contributions in the event of deficits other
than the annual contributions. This means that recognizing the contribution as
an expense suffices.
Contents Notes to the company cash flow statement ABP Annual Report 2021 184
Notes to the company cash flow statement

The closing balance of funds can be specified as follows: Cash flow from investment activities
31-12-2021 31-12-2020
The cash flow statement presents cash flows from direct investment yields and
Investments 1,252 1,058 bank account currency results.
Cash 276 298
The other movements item arises from a number of effects including
Total cash 1,528 1,356 movements in bank account negative balances,movements in the short-
term money market products, currency effects and the investment pool
transparency methodology.
Cash flow from pension activities
The contributions received in the cash flow statement comprise contributions

totaling €11,679 million and contributions received in respect of the
€925 million payable for the purchase of conditional pension rights as
recognized under payables and other liabilities.
The increase in the contributions received in 2021 is largely due to the growth
in the number of participants, as well as due to the 1 percentage point
increase in the retirement pension (OP)/surviving dependents’ pension (NP)
contributions compared with 2020.
The increase in pension payments is largely due to the increase in the number
of pensioners.
Contents Other notes to the company financial statements ABP Annual Report 2021 185
Other notes
Actuarial analysis
Notes 2021 2020 Notes 2021 2020
Result on contributions Pension administration costs (net) 13 -156 -141

Pension contributions (net) 7 12,604 11,631 Utilized to cover pension administration costs out
Pension accruals 10 -20,546 -17,374 of the provision for pension liabilities 10 105 96
Collection cost supplements in
pension contributions 11 116 110
Subtotal -7,942 -5,743
Results on interest
Subtotal 65 65
Other results
Interest charges on investment-related liabilities -16 -68
Result on actuarial assumptions 10 702 928
Added interest 10 2,842 1,550
Change in market interest rate 10 34,220 -63,194
Change in provision for pension liabilities in
Subtotal 93,466 -31,090
respect of value transfers 10 -211 -62
Result on pensions
Change in actuarial assumptions 10 2,560 13,449
Pensions payments 9 -12,908 -12,382
Other movements in provision for
Utilized for pensions out of the provision for
pension liabilities 10 -1,468 -1,367
pension liabilities 10 12,864 12,439
Subtotal 1,614 12,810

Subtotal -44 57
Result on expenses
Total result = net gains and losses 87,159 -23,901
Remuneration Remuneration of members of the Board of Trustees
in € 2021 2020
The remuneration policy is based on fixed remuneration determined by the
time invested in the ABP Board of Trustees or other position. The Chair receives C.M. Wortmann-Kool (chairman) 130,000 130,000
fixed remuneration based on an agreement for services and determined by the A. Boonen (from 1-1-2021) (as of 4-9-2021
vice chairman)1 97,280 -
number of days on which the Chair is active for the Board of Trustees. The
M. Doornekamp (until 10-1-2021) 67,500 90,000
remuneration is €130,000 a year based on a four-day working week.
C. van Eykelenburg (until 10-1-2020) - 67,500
P. Fey 1
90,000 90,000
Board Members receive fixed remuneration of €90,000 a year, with the
A. Gram (from 6-1-2021) 52,500 -
possibility of a supplement of €10,000 when board membership requires a
G.A.C. Leegwater (until 11-1-2020) - 75,000
more-than-average amount of time. This is the case, for example, for the
J. Meijer (until 6-4-2020)1 - 50,000
two Vice Chairs of the Board of Trustees. The remuneration is not subject to
C.M. Mulders-Volkers 90,000 90,000
social security contributions, and no pension is accrued. The remuneration for
K. Nauta 90,000 90,000
external members of committees remained unchanged in 2021. P. Rosenmöller (from 12-1-2021) 7,500 -
A.J.M. Sibbing (as 4-9-2021 vice chairman) 97,280 90,000
Indexation of the remuneration of the members of the Board of Trustees M. Snel (from 9-1-2020 and until 9-1-2021) 60,000 30,000
is dependent on the pension indexation. Indexation was not applied to the P..A Stork (until 1-1-2022) 90,000 90,000
remuneration of the Board of Trustees, as pensions were not increased in X.J. den Uyl 90,000 90,000
2021. The members of the Board of Trustees did not receive bonuses, loans, A. van Vliet (until 4-9-2021 vice chairman) 92,720 95,750
advances, or guarantees. J.P.C.M. van Zijl (until 4-9-2021 vice chairman) 27,198 100,000
W. Bolhuis (until 12-31-2020)2 - 11,485
Total remuneration of the Board of Trustees 1,081,978 1,189,735
1 fees paid to the appointing bodies

2 trainee board member
Members of fund bodies (including external members) Related-party transactions
in € 2021 2020
Related-party transactions take place at arm's length. The remuneration of the
Appeals Committee 37,545 34,833 Board of Trustees is explained in the remuneration subsection.
Board Committee on Investment Policy - 35,000
Accountability Body 253,289 160,017 ABP is the lessor of part of the APG business premises, which is leased at
Supervisory Board 130,000 130,000 market level. The yield was €6.5 million in the reporting year (2020: €6.5 million)
and will be €6.6 million in 2022.
Total remuneration of members of fund bodies
(including external members) 420,834 359,850
Stichting Pensioenfonds ABP, APG Groep NV, APG DWS and Fondsenbedrijf NV,
APG Asset Management NV, APG Trading BV, as well as Entis Holding BV and
Entis BV jointly form a fiscal entity for turnover tax purposes.
Members of the Board of Trustees are not members of the fund's bodies
listed in the above table, other than the Appeals Committee and the Board
Committee on Investment Policy, which do also include members of the Board
of Trustees. The Board Committee on Investment Policy had no external
members in 2021. The increase in Accountability Board remuneration is
attributable to the fact that more meetings took place in 2021, partly as a
result of the advice on the governance change to a reversed-mixed governance
model (OGM).
List of collective investment schemes managed by the

administrative organization
The majority of the invested assets are invested in mutual funds managed by
the administrative business, in which ABP participates. These mutual funds are:
Mutual funds
– APG Alternative Credits Legacy Pool – APG Opportunities Pool 2012

– APG Commodities Pool – APG Long Duration Treasury Pool
– APG Developed Markets Equity Minimum Volatility Pool (t/m 31 januari 2021) – APG Infrastructure Pool 2011
– APG Developed Markets Equity Pool – APG Infrastructure Pool 2012
– APG Emerging Markets Debt Pool – APG Infrastructure Pool 2014
– APG Emerging Markets Equity Pool – APG Infrastructure Pool 2016
– APG Euro Plus Treasuries Pool – APG Infrastructure Pool 2017
– APG Fixed Income Credits Pool – APG Infrastructure Pool 2017 II
– APG Hedge Funds Pool – APG Infrastructure Pool 2020-2021
– APG Index Linked Bonds Pool – APG Strategic Real Estate Pool
– APG Private Equity Pool 2009 – APG Tactical Real Estate Pool
– APG Private Equity Pool 2010
– APG Private Equity Pool 2014-2015
Contents Consolidated financial statements ABP Annual Report 2021 189
Consolidated balance sheet

After appropriation of result
Note 31-12-2021 31-12-2020 Note 31-12-2021 31-12-2020
Assets Capital and liabilities
- real estate 77,270 60,322 Group equity 3 53,659 -33,503

- equities 225,984 205,600
- fixed-income investments 218,713 195,030 Provision for pension liabilities 4 498,797 529,865
- other investments 35,493 40,231 - collateral received 14,977 25,920
- short positions - 287
Investments 1 591,694 551,614 - short-term borrowing 1,077 3,419
Other assets 2 2,260 2,169
Investment-related liabilities 5 37,289 54,424
Payables and other liabilities 6 4,209 2,997
Total assets 593,954 553,783 Total capital and liabilities 593,954 553,783
Consolidated statement of income and expenses

in € mln Note 2021 2020
Income
Contributions (net) 7 12,604 11,631
-investment results (gross) 56,954 31,046

-less: asset management costs -508 -392
Total income 69,050 42,285

Expenses
Pensions and other benefits 9 -12,908 -12,382
Total movements in provision for
pension liabilities 10 31,068 -53,535
Collection cost supplements in
pension contributions 116 110
Pension and insured benefit administration
costs (net) 12 -180 -158
Interest charges on investment-related liabilities -18 -83
Total expenses 18,109 -66,186

Balance of income and expenses 87,159 -23,901
Total direct movements in the pension

fund capital -1 -7
Comprehensive result 87,158 -23,908

Consolidated cash flow statement

in € mln Note 2021 2020 in € mln Note 2021 2020
Opening balance of cash 1,849 1,687 Cash flows from investment activities:
Movements - repayments and sales of investments 102,318 78,117
Cash flows from pension and insurance activities: - advances and purchases of investments -65,025 -101,581
- contributions received 12,720 11,741 - direct investment income 5,515 7,630
- value transfer payments received 11 284 126 - indirect realized results from derivatives and
- pensions and other benefits paid 9 -12,908 -12,382 results on exchange -11,103 12,142
- value transfer payments made 11 -42 -45 - investment expenses paid -591 -391
- operating expenses paid -154 -396 - collateral received -10,515 3,777
- other movements 78 - other movements -20,331 1,424
Cash flow from pension and Cash flow from investment activities 268 1,118
insurance activities -22 -956
Closing balance of cash 2,095 1,849
Contents General notes to the consolidated financial statements ABP Annual Report 2021 192
Notes – general
Accounting policies – general Raad voor de Jaarverslaggeving (Dutch Accounting Standards Board) Richtlijn
Pensioenfondsen (pension fund guidelines) (RJ 610.211), recognized separately
Identical accounting policies are applied to the consolidated and company in the balance sheet..
financial statements. These accounting policies are binding on group
companies and other consolidated entities.
Accounting policies of valuation of assets and liabilities
The consolidation principles and the accounting policies for additional items
presented on the balance sheet and statement of income and expenses are Other assets
explained below. The intangible assets included in the other assets and liabilities item are
carried at acquisition price less straight-line amortization, where applicable,
taking account of any impairment losses. The amortization period is based
Accounting policies for consolidation on the expected economic payback time. The identifiable assets and liabilities
of an acquired company are recognized in the balance sheet at current
Capital interests, other than investments, in entities in which control can be value on acquisition date. Goodwill arising on acquisition is measured on first
exercised over management decisions and financial policy are recognized in recognition as the difference between the acquisition price and the current
the consolidated financial statements by applying the integral consolidation value of the identifiable assets and liabilities.
method. Intercompany transactions and underlying financial liabilities are
eliminated. Consolidation goes beyond the legal format of the capital interest Derivative positions held by subsidiaries and second-generation subsidiaries
and provides an immediate insight into the financial position of the entire other than positions opened in the context of investments are measured at
group. Joint ventures are recognized as capital interests. cost using the cost price hedge accounting method.
A list of direct capital interests and the most significant capital interests
included in the consolidation is enclosed in the Other notes section.
The values of units in mutual funds are recognized under the applicable
investment categories. The positive and negative derivative positions,
borrowing positions, short positions, and liabilities arising from received
collateral included in the value of these units are, in accordance with the
Contents General notes to the consolidated financial statements ABP Annual Report 2021 193
Payables and other liabilities

The provision for deferred taxes recognized under provisions relates to the
deferred tax liabilities arising from temporary differences between commercial
and fiscal assets. The calculation takes account of rates in effect in coming
years in so far as they have already been set. Measurement is at current value.
Other provisions are carried at the fair value of the expected future
expenditure, taking account of actuarial assumptions, where applicable. The
discount rate used is based on the year-end interest rate for investment-grade
Dutch corporate bonds, taking account of the remaining term of the provisions.
The discount rate for provisions with an expected term of longer than 15 years
is based on the interest rate for long-term government bonds.
Contents Risk section of the consolidated financial statements ABP Annual Report 2021 194
Risk section
The risks to which ABP is exposed as a pension fund are explained in the notes The mutual funds are investment pools without legal personality in which
to the company financial statements. The consolidated financial statements participants acquire rights in proportion to their investment. Participants do
also show the financial positions of the entities in the group consolidated not have control over or an influence on each other's assets. All participants
with the integral consolidation method. These relate, in essence, to the can withdraw in accordance with rules specified in advance in the mutual
administrative business, capital interests in which investments are placed, and fund documents. The values of units in mutual funds are recognized under
APG Liquiditeitenbeheer BV (hereinafter referred to as “APG LB”). the applicable investment categories. The positive and negative derivative
positions, borrowing positions, short positions, and liabilities arising from
The following section, which supplements the risk section in the company received collateral included in the value of these units are, in accordance
financial statements, reviews the consolidation of APG LB, the effect of the with the Raad voor de Jaarverslaggeving (Dutch Accounting Standards Board)
consolidation on the balance sheet and the associated risk profile, as well as Richtlijn Pensioenfondsen (pension fund guidelines) (RJ 610.211), recognized
the specific risks of APG LB. separately in the balance sheet.
General Effect on the balance sheet and the associated risk profile
As of December 2017, APG LB places mutual fund surpluses in or supplements In 2021, the effect of the consolidation on the balance sheet and the associated
deficits with deposits. APG LB transfers these surpluses and deficits to the risk profile was largely caused by APG LB. The consolidation of APG LB resulted
pension funds. in an increase in the investments and investments-related liabilities items.
The equities in APG LB are held by the mutual fund custodians. The consolidation of APG LB does not result in a materially different risk
profile from the company balance sheet, as APG LB's object is to place mutual
As ABP has indirect control of APG LB, this company must be included in fund surpluses in or supplement deficits with deposits, which APG LB then
the consolidation. transfers to ABP and the other participating pension funds. APG LB conducts
transactions only with participating mutual funds and pension funds.
This consolidation involves the elimination of the positions held directly by ABP
and indirectly through the mutual funds in APG LB.
Contents Notes to the consolidated balance sheet ABP Annual Report 2021 195
Notes to the consolidated balance sheet

Assets
1. Investments
Fixed-income Other
Real estate Equities investments Derivatives investments Total 2021 Total 2020
Opening balance of investments 60,322 205,600 195,030 50,431 40,231 551,614 514,275
Granted/bought 3,924 23,531 109,449 - 1,585 138,489 101,583
Repaid/sold -682 -52,680 -86,783 - -32,597 -172,742 -78,117
Change in value 1
12,429 50,248 -3,829 - 11,358 70,206 8,655
Other movements 1,277 -715 4,846 -16,197 14,916 4,127 5,218
Closing balance of investments 77,270 225,984 218,713 34,234 35,493 591,694 551,614
1 Including movements up to the time of disposal.
Investments are presented including the associated receivables, cash, and The values of units in mutual funds are recognized under the applicable
payables. These can be held directly or indirectly through units in mutual funds investment categories. The positive and negative derivative positions,
formed by the administrative business. borrowing positions, short positions, and liabilities arising from received
collateral included in the value of these units are, in accordance with the
The other movements item includes movements in the receivables, cash, Raad voor de Jaarverslaggeving (Dutch Accounting Standards Board) Richtlijn
and payables associated with the investments and the movements in the Pensioenfondsen (pension fund guidelines) (RJ 610.211), recognized separately
derivative positions. in the balance sheet.
The closing balance of the investments totaling €591.7 billion (2020: The current account bank balances item includes balances of margin accounts
€551.6 billion) can be broken down as follows: held in connection with future positions to a total of €0.5 billion (2020:
€0.5 billion). These balances are not freely disposable.
31-12-2021 31-12-2020
Listed 404,579 369,272 The payables, accruals, and deferred income under investments include bank
Unlisted 187,115 182,306 account debit balances totaling €1.2 billion (2020: €1.0 billion).
Investments for participant schemes are an integral part of the investments.

The closing balance of the investments totaling €591.7 billion (2020:
€551.6 billion) includes: Analyses
The following tables present analyses of the investments by class, region,
31-12-2021 31-12-2020
and currency (all in million euros). The currency table does not include
Receivables, prepayments and accrued income 1,055 1,126 the derivative item, as this is presented in a separate table together with
Collateral paid 2,489 901 derivatives with a negative current value and short positions.
Short-term lending (including CIS short-term
cash positions) 17,885 23,397
Current account bank balances 1,254 89
Payables, accruals and deferred income -2,450 -458
Net assets included in current investments 20,233 25,055

Investments by category
Basic materials 17 11,167 1,001 285 1,766 14,236 14,785

Mortgages etc. - - 17,805 7 - 17,812 17,791
Real estate 50,318 4,314 662 - - 55,294 45,034
Utilities 529 4,289 3,276 - - 8,094 8,312
Telecommunications 2,381 4,455 4,540 - - 11,376 10,502
Healthcare 224 23,309 3,454 - 20 27,007 26,393
Luxury goods 1,872 26,829 3,830 - 4 32,535 33,311
Energy 8,026 5,334 2,656 508 677 17,201 16,306
Manufacturing 12,481 22,584 4,104 - - 39,169 34,423
Financial institutions 160 41,038 27,296 33,040 31,278 132,812 138,171
Convenience goods - 14,577 1,810 296 932 17,615 18,039
Information technology 685 67,973 1,630 - - 70,288 59,159
Public authorities 577 115 146,649 98 816 148,255 129,388
Investments by region
Netherlands 4,132 3,695 14,670 3,258 2,446 28,201 29,120

Rest of EMU 17,950 21,465 88,404 29,527 6,772 164,118 160,160
Rest of Europe 13,333 21,119 23,328 753 3,605 62,138 62,114
North America 25,509 126,861 67,266 684 19,693 240,013 207,445
Asia/Pacific 15,030 49,384 13,997 12 2,379 80,802 77,604
Other 1,316 3,460 11,048 - 598 16,422 15,171

Investments by currency, excluding derivatives

Fixed-income
Real estate Equities investments Other investments 31-12-2021 31-12-2020
Euro 24,382 26,886 111,349 13,557 176,174 159,694

US dollar 28,073 125,280 73,901 18,674 245,928 213,111
Sterling 8,270 8,110 12,390 131 28,901 24,979
Chinese Yuan 1,318 12,787 1,701 2 15,808 17,741
Yen 847 9,638 -2 824 11,307 12,588
Australian dollar 3,986 2,800 1,313 1,241 9,340 8,540
Taiwan dollar - 6,471 - - 6,471 6,092
Hong Kong dollar 4,321 1,320 - 20 5,661 5,862
Indian Rupee 730 4,976 135 10 5,851 5,128
Canadian dollar 238 3,438 1,373 371 5,420 5,007
Korean Won - 5,222 80 3 5,305 4,979
Swiss franc 200 3,736 30 212 4,178 4,263
Other 4,905 15,320 16,443 448 37,116 33,199
Total 77,270 225,984 218,713 35,493 557,460 501,183

Derivatives and short positions by currency

Derivatives: Derivatives:
positive negative Short positions 31-12-2021 31-12-2020
Euro 97,190 84,885 - 182,075 179,842

US dollar -57,050 -75,391 - -132,441 -118,838
Sterling 805 -21,356 - -20,551 -18,608
Chinese Yuan 223 -38 - 185 250
Yen -5,516 -804 - -6,320 -6,441
Australian dollar -2,128 -2,814 - -4,942 -4,831
Taiwan dollar -1 - - -1 1
Hong Kong dollar -323 145 - -178 -27
Indian Rupee 17 - - 17 -
Canadian dollar 989 -3,617 - -2,628 59
Korean Won 20 28 - 48 -3,280
Swiss franc -235 -2,289 - -2,524 -2,924
Other 243 16 - 259 143
Total 34,234 -21,235 - 12,999 25,346
The division between “Derivatives positive” and “Derivatives negative” in the

currency table is partly influenced by the currency hedging positions. These
positions are a snapshot. A forward currency contract is a contract to buy or
sell a given amount of a currency at an agreed exchange rate on an agreed
future date. Buying increases the currency position and selling decreases the
position. Both positions are presented in the above table. The final balances
are in part dependent on exchange rate movements since the conclusion of
the contract.
Notes by investment category Equities investments comprise:

Real estate investments encompass investments in:
Investments in equities
31-12-2021 31-12-2020
Real estate investments
31-12-2021 31-12-2020 Developed markets 141,208 132,966
Residential property 14,783 12,110 Emerging markets 39,747 41,230
Offices 7,165 3,682 Private equity 44,340 31,286
Retail property 10,551 9,493 Other assets and liabilities 689 118
Industrial buildings 12,469 8,827
Hotels 2,200 1,464 Total investments in equities 225,984 205,600
Other 8,863 8,503
Total investment properties 56,031 44,079 Private equity investments relate to equities in unlisted companies in sectors
Industrial companies 8,938 7,662
including the venture capital sector. Indirect investments totaled €7.2 billion
Energy 8,026 5,523
(2020: €4.3 billion), and direct investments totaled €37.1 billion (2020:
Telecommunications 2,381 1,377
Other 1,894 1,681 €27.0 billion).
Total infra investments 21,239 16,243 Fixed-income investments comprise:
31-12-2021 31-12-2020
The other item includes other assets and other liabilities relating to
investments totaling €152.0 million (2020: €45 million). Government bonds 140,295 119,714
Corporate bonds 45,773 42,915
Mortgage loans 14,884 15,164
Mutual funds 7,359 5,775
Index bonds 767 4,755
Private loans and bank loans 3,061 2,689
Other investments 1,104 442
Other assets and liabilities 5,470 3,576
Total fixed income investments 218,713 195,030

The short position at year-end 2021 was €0 million (2020: €287 million). The The creditworthiness of fixed-income investments is usually expressed in terms
balance at year-end 2021 is recognized under the investment-related liabilities of a credit rating.
balance sheet item.
The ratings of the fixed-income investments can be specified as follows:
The breakdown of the fixed-income investments item by coupon rate is
as follows: Fixed-income investments rating analysis
No
AAA AA A BBB <= BB rating Total
Fixed-income investments analyzed to interest rate
31-12-2021 31-12-2020 2021 33% 28% 11% 14% 11% 3% 100%
2020 33% 28% 11% 15% 10% 3% 100%
< 0% 848 11,358
0%-1% 52,037 31,769
1%-2% 38,819 36,919
2%-3% 34,116 31,942
3%-4% 28,180 29,581 This table shows that 72% (2020: 72%) of the fixed-income investments have a
4%-5% 31,061 24,356 rating of A or higher.
> 5% 26,293 23,331
No coupon 7,359 5,774 The duration of fixed-income investments is often used to provide an insight
into the cash flows. The duration is the average, weighted maturity of all
cash flows (interest and principal redemptions) relating to the fixed-income
products. The duration of the fixed-income investments is approximately 10
years (2020: approximately 9 years).
The remaining term to maturity of the fixed-income investments as determined
by the contractual redemption dates can be presented as follows:
Fixed-income investments analyzed by maturity

31-12-2021 31-12-2020
Shorter than one year 8,901 4,178

Between one year and five years 38,147 40,337
Longer than five years 164,306 144,741
No maturity 7,359 5,774

The breakdown of derivatives with a positive current value is as follows: Other investments
31-12-2021 31-12-2020
Derivatives Other investments 35,493 40,194

31-12-2021 31-12-2020
Currency derivatives
Forward currency contracts 467 3,421 Other investments relate to investments of €17.7 billion (2020: €16.8 billion)
in hedge fund strategies. This item also includes investments of €3.9 billion
Cross-currency swaps - - in commodities (2020: €2.1 billion). The carrying amount of other assets and
Interest rate derivatives other liabilities relating to investments included in Other investments was
€13.9 billion (2020: €21.3 billion).
Inflation linked swaps 758 1,487
TBAs 7 25
Other derivatives
Other swaps - -
Other futures 1,167 1,993
Total derivatives with positive fair value 34,234 50,431
Accounting Standards). The current value of derivatives is greatly dependent
on factors including prices/exchange rates and interest rates at year-end as
compared with the prices/exchange rates and interest rates at the time the
derivative positions were opened.
2. Other investments The property item includes both property with an estimated economic life of
30 years and plant with an estimated economic life of 15 years. The other item
31-12-2021 31-12-2020
relates to equipment and fittings, furnishings with an estimated economic life
Participating interests 2 3 of between five and ten years, and computers with an economic life of between
Intangible assets 2 2 four and five years.
Tangible assets 92 88
Receivables, prepayments and accrued income 1,324 1,286 The receivables, prepayments, and accrued income comprise:
Cash 841 790
Receivables, prepayments, and accrued income

Total other assets 2,261 2,169 31-12-2021 31-12-2020
Receivables from employers 940 895

Receivables in respect of value transfers 178 171
The cash item includes deposits of €230 million (2020: €170 million). Receivables from participants 2 2
€9.3 million of this cash is not freely disposable (2020: €8.0 million). No other Other receivables 204 218
collateral has been furnished.

Total receivables, prepayments and accrued income 1,324 1,286
The property, plant, and equipment comprise:
Tangible assets The receivables contain no receivables becoming due and payable after more
31-12-2021 31-12-2020
than one year (2020: none).
Buildings 41 62
Other 51 26
Total tangible assets 92 88

Capital and liabilities 4. Provision for pension liabilities
31-12-2021 31-12-2020
3. Group equity
Proprietary risk 498,680 529,767
Pension Policyholders' risk 117 98
fund Total Total
capital Minority interests 2021 2020
Total provision for pension liabilities 498,797 529,865
Opening balance -33,552 49 -33,503 -9,595
Fund result 87,159 1 87,160 -23,901
Change in minority interests - - - -7
An additional explanation of the provision for pension liabilities is included in
the notes to the company financial statements.
Closing balance of
group equity 53,607 50 53,657 -33,503
5. Investment-related liabilities
31-12-2021 31-12-2020
The group equity presented in the consolidated balance sheet is €50 million
higher than in the company balance sheet. This difference is due to third-party Collateral received 14,977 25,920
minority interests in participating interests included in the consolidation. Short positions - 287
Short-term borrowing 1,077 3,419
APG Groep NV's dividend distributions take account of restrictions prescribed Derivatives 21,235 24,798
by the applicable legislation and regulations, including the Markets in Financial

Total investment-related liabilities 37,289 54,424
Instruments Directive (MiFiD).
Collateral received relates to surety for opened transactions

(derivative positions).
Short-term borrowing of €1.1 billion (2020: €3.4 billion) includes €0.0 billion
of repos (2020: €0.0 billion). A fee is charged for entering into repos. Cash is
temporarily obtained to cover the non-return risk.
Accounting Standards). The negative derivative positions can be specified Provisions

as follows: The provisions relate primarily to personnel-related provisions and the
provision for deferred taxes.
Derivatives with negative fair value
31-12-2021 31-12-2020
Long-term liabilities
Currency derivatives Long-term liabilities after consolidation total €11 million (2020: €11 million),
Forward currency contracts 2,193 541
which relate to loans by third parties in which a capital interest is held. An
amount of €10.9 million of the closing balance has a remaining term of more
Interest rate derivatives
Interest Rate Swaps 17,034 21,133 than five years (2020: €10.9 million). The interest rate is 7.25% per annum
Inflation-linked swaps 1,037 2,540 (2020: 7.25% per annum). No security has been furnished.
TBAs 3 3 Payables in respect of pensions
Payables in respect of pensions includes tax and social security contributions
Other derivatives
totaling €326million (2020: €320 million).
Other futures 694 353
Other payables
Total derivatives with negative fair value 21,235 24,798 The purchase of conditional rights totaling €2,951 million (2020: €2,044 million)
and a €0 million liability towards Defense (2020: €4 million) are explained
further in the notes to the company balance sheet.
6. Payables and other liabilities
31-12-2021 31-12-2020
Provisions 77 80
Long-term liabilities 11 11
Payables in respect of pensions 345 350
Other payables 3,776 2,556
Total payables and other liabilities 4,209 2,997
The payables and other liabilities recognize items, as part of the other
payables, becoming due and payable after more than one year to a total of
€253 million (2020: €23 million). No securities have been furnished.
Off balance sheet liabilities and assets Liabilities have been entered into for other investments totaling €2.9 billion at
the balance sheet date (2020: €3.1 billion).
Liabilities arising from investments
Liabilities entered into for real estate investments totaled €11.5 billion on the Other liabilities
balance sheet date (2020: €9.5 billion). Liabilities arising from current leases of €264.5 million were open at the
balance sheet date (2020: €164.2 million), of which €14.8 million falls due within
Liabilities have been entered into for private equity investments to make one year (2020: €14.9 million), €62.7 million within one and five years (2020:
deposits on request. These liabilities totaled €17.8 billion on the balance sheet €59.6 million), and €186.9 million after five years (2020: €89.7 million).
date (2020: €20.0 billion).
In 2015, ABP entered into long-term contracts for the provision of professional
Liabilities entered into for investments in investment funds totaled €2.5 billion services as part of the development of and investments in the Brightlands
on the balance sheet date (2020: €2.4 billion). Smart Services Campus, in Heerlen, by ABP together with Maastricht University
and the Province of Limburg. The liabilities arising from these contracts total
Securities furnished as collateral were €0.0 billion (2020: € 0.0), and €0.0 million (2020: €4.7 million) and must be wound down within the coming
securities received as collateral were €0.0 billion (2020: € 0.0). Securities five years.
totaling €0.4 billion (2020: €0.0 billion) were received as collateral (bilateral
initial margin). Investment commitments for hardware and software to a total of €11.1 million
had been entered into by year-end of the reporting year (2020: €10.7 million).
Securities totaling €3.0 billion have been deposited as initial margin (2020:
€1.0 billion) , and securities totaling €0.4 billion have been furnished as Liabilities arising from maintenance and other contracts totaling €60.1 million
collateral (bilateral initial margin) (2020: €0.0). Securities received from repos were open at year-end (2020: €32.5 million), of which €20.1 million (2020:
totaled €0.9 billion (2020: €3.8 billion), and securities totaling €0.0 billion were €11.8 million) falls due within one year and €39.9 million in the following years
issued (2020: €0.0 billion). Cash posted for initial margin relating to derivatives (2020: €20.7 million).
totaled €0.5 billion (2020: €0.5 billion).
Liabilities arising from long-term vehicle leases totaled €6.7 million (2020:
An intraday facility has been taken out with ABN-AMRO Bank NV to a total of €7.8 million), of which €2.7 million (2020: €3.1 million) falls due within one
€6.3 billion (2020: €1.2 billion). An intraday facility has also been taken out with year after the close of the fiscal year and €4.0 million (2020: €4.7 million)
ING to a total of €0.5 billion (2020: €0.5 billion). These facilities had not been between one and five years. Lease costs of €3.0 million (2020: €3.7 million)
drawn at year-end 2021. No collateral was furnished for these agreements/ were recognized in the reporting year. The leasing company specified this lease
facilities. APG Liquiditeitenbeheer B.V. does not have any credit facilities. liability based on depreciation plus the costs of fuel, insurance, and servicing.
A long-term contract for the provision of business services was concluded

in 2018. The liabilities arising from this contract totaled €0.7 million at year-
end 2021 (2020: €1.6 million), of which €0.7 million (2020: €1.0 million) falls
due within one year after the close of the fiscal year and €0.0 million (2020
€0.6 million) between one and five years.
A fiscal entity comprising ABP, APG Groep NV, and APG Groep NV subsidiaries
and second-generation subsidiaries has been formed for turnover tax
purposes. The companies in such a fiscal entity are jointly and severally liable
for their tax liabilities.
Contents Notes to the consolidated statement of income and expenses ABP Annual Report 2021 208
Notes to the consolidated statement of income

and expenses
Revenue
7. Net contributions
Total contributions (net) 12,604 11,631
8. Net investment results
Fixed-income Other
Real estate Equities investments Derivatives investments 2021 2020
Direct results 805 1,110 5,083 2,318 -236 9,080 7,631

Indirect results 12,539 50,426 -3,701 -21,715 10,325 47,874 23,415
Asset management costs -124 -207 -102 -3 -72 -508 -392
Total investment results (net) 13,220 51,329 1,280 -19,400 10,017 56,446 30,654
Expenses
9. Pensions and other benefits 11. Balance of transfer of rights
Total 2021 Total 2020 2021 2020
Total pensions and other benefits -12,908 -12,382 Value transfers 242 81
The pensions and other benefits item relates to ouderdoms- en 12. Pension management costs
nabestaandenpensioen (OP/NP retirement pensions and surviving dependents’
2021 2020
pensions) and arbeidsongeschiktheidspensioenen (AOP, occupational
disability pensions) comprising arbeidsongeschiktheidspensioen (AAOP, Salaries (including social security charges) -384 -358
ABP occupational disability pensions), invaliditeitspensioenen (IP, invalidity Pension charges -40 -35
pension), and herplaatsingstoelagen (HPT, redeployment allowance), as well as Other staff costs -20 -41
benefits under life and non-life insurance products. Depreciation -26 -16
Third-party services -138 -109
Other operating expenses -159 -132
10. Total movements in provision for pension liabilities
2021 2020 Subtotal -767 -691

Less: income from work on behalf of third parties 223 222
Movements 31,068 -53,535
Less: attributed to asset management costs 364 311
Pension and insured benefit administration

A further explanation of the movements in the provision for pension liabilities costs (net) -180 -158
is enclosed in the note to the company statement of income and expenses.
The other operating expenses item relates primarily to automation and

accommodation of the administrative business.
The average number of staff was:
2021 2020
ABP 42 43
Consolidated entities 3,124 3,013
(Of whom, employed outside the Netherlands) 246 228
The further analysis is:

- management and corporate staff 727 477
- administrative units 2,439 2,335
- service units - 245
The staff of the pension fund (ABP) and the staff of the administrative
business (APG) are members of the ABP pension scheme or the APG
company pension fund. Neither scheme obligates the employer to make
supplementary contributions to the pension fund in the event of deficits other
than the payment of the annual contributions. This means that recognizing the
contribution as an expense suffices.
The Stichting Personeelspensioenfonds APG (PPF APG) company pension fund

scheme is an average pay scheme. Indexation of granted claims and rights is
applied only when the pension fund's financial position offers sufficient scope.
PPF APG has entered into an administrative agreement with the employers that
sets out the rights and obligations. More information, including on the financial
position of the fund, is available on the PPF APG website.
Contents Post-balance sheet events ABP Annual Report 2021 211
Post-balance sheet events

Adjustment of UFR of Ukrainian wheat supplies. The economy is faced with a negative supply
shock, and this means less growth and more inflation. This type of environment
The DNB interest term structure for pension funds has been determined using is usually accompanied by substantial volatility.
the Ultimate Forward Rate (UFR) in the years since 2012. Until December
31, 2020,the UFR was based on the120-month rolling average of the 20-year Many investors, including ABP, have decided to withdraw from Russian
forward rate, for this reason referred to as the UFR20. investments, although this has not always been possible in practice. At year-
end 2021, positions in Russian instruments totaled €1.9 billion. In the first few
In 2019, the Parameters Committee recommended adjusting the UFR method, weeks of 2022, ABP already further reduced its positions in Russia, to around
on the basis of the 120-month rolling average of the 30-year forward rate. DNB €520 million as at February 24, the date on which Russia invaded Ukraine. On
has decided to introduce this new UFR in four equal steps from January 1, 2021. March 9, 2022, the positions in Russian instruments had been further reduced
The change in the UFR method represents a change in the accounting estimate to €12 million.
for the Provision for pension liabilities.
Positions in Ukrainian instruments totaled €0.4 billion at year-end 2021. On
As of January 1, 2021, the effect of the first step of the UFR change resulted March 9, 2022, these positions had been reduced to €108 million.
in an increase in the provision as part of the movement in Effect of Interest
Term Structure. The impact of the second step of the new UFR method on the The sale of the remaining investments may take some time, as market
funding ratio at January 1, 2022, is -0.9 percentage points. conditions are currently complicated. As soon as they are possible in a
responsible manner, the sales will be effected by our asset manager APG. In
view of the uncertainty in the financial markets following the Russian invasion,
Political and economic developments ABP is closely monitoring its impact on our investments. We are also very
closely following the impact of the global package of sanctions that Russia has
The world has not stood still since the balance sheet date. High inflation brought upon itself.
rates are proving more stubborn than previously thought, and this brings
expected interest rate measures by central banks considerably closer. Equity
markets made a poor start, and the Russian invasion of Ukraine has amplified
concerns. Energy prices have increased sharply owing to concerns about supply
problems and boycotts; sanctions such as exclusion from SWIFT may have
unknown consequences; and food prices may rise significantly in the absence
Contents Notes to the consolidated cash flow statement ABP Annual Report 2021 212
Notes to the consolidated cash flow statement

Amounts in millions of euros unless otherwise stated
The cash item can be specified as follows: Cash flow from investment activities
31-12-2021 31-12-2020
The cash flow statement presents cash flows from direct investment revenue
Investments 1,253 1,059 and bank account currency results.
Other assets 841 790
The other movements item recognizes other effects due to movements in the
Total cash 2,094 1,849 collateral received and negative bank balances balance sheet items, and and
to currency effects, movements in the short-term money market products, and
the investment pool transparency methodology.
Cash flow from pension activities
The contribution receipts in the cash flow statement comprise contributions

totaling €11,795 million, contributions received in respect of the €925 million
payable for the purchase of conditional pension rights, as recognized under
payables and other liabilities, and coverage from the mark-up on contributions
totaling €116 million.
The increase in the contributions receipts in 2021 is largely due to the increase
in the ouderdoms- en nabestaandenpensioen (OP/NP, retirement pensions,
and surviving dependents' pensions) contributions in 2021.
The increase in pension payments is due to the increase in the number

of pensioners.
Contents Other notes to the consolidated financial statements ABP Annual Report 2021 213
Other notes
Amounts in millions of euros unless otherwise stated
Summary of the important capital interests included in the consolidation
The following list has been prepared based on the provisions of Sections 379 and 414, Title 9, Book 2, of the Dutch Civil Code.
Processed in
Entities Domicile Interest Main activity
financial statements
Elkhorn Barges, Inc. Wilmington, Delaware 58 Investment in private equity Investment

Externe Hypothecaire Beleggingen Heerlen B.V. Heerlen 100 Holding Investment
Kaena Capital Opportunities Corp Wilmington, Delaware 56 Investment in private equity Investment
Klavier Investments Holding B.V. Heerlen 100 Investment in real estate Investment
Limetree Investments Inc. Wilmington, Delaware 100 Investment in private equity Investment
Lumbercy B.V. Amsterdam 100 Investment in real estate Investment
Malapolski Investments Holding B.V. Heerlen 100 Investment in real estate Investment
Oiltree Investment Holding B.V. Amsterdam 100 Investment in real estate Investment
Olygia Investments Holding B.V. Heerlen 100 Investment in fixed income Investment
Parijs Kantoren Fonds B.V. Amsterdam 100 Investment in real estate Investment
Physalis Investments Holding B.V. Heerlen 100 Investment in commodities Investment
Portfolio AC GP B.V. Heerlen 100 Investment in hedge funds Investment
Restalux B.V. Amsterdam 100 Investment in real estate Investment
Telestes Investments Holding B.V. Heerlen 100 Investment in hedge funds Investment
Timpani Investments Holding B.V. Heerlen 100 Investment in real estate Investment
ABP Life Cycle Holding B.V. Heerlen 100 Holding Investment
AlpInvest Partners CSI 2006 B.V. Amsterdam 60 Investment in private equity Investment
AlpInvest Partners Primary Fund Inv. 2006 B.V. Amsterdam 60 Investment in private equity Investment
AlpInvest Partners Primary Fund Inv. 2007 B.V. Amsterdam 65 Investment in private equity Investment
AlpInvest Partners Primary Fund Inv. 2008 I B.V. (ABP) Amsterdam 100 Investment in private equity Investment
Processed in
Entities Domicile Interest Main activity
financial statements
AlpInvest Partners SL B.V. Amsterdam 60 Investment in private equity Investment

APG Groep N.V. Heerlen 92 Pension administration organization consolidation
- APG DWS en Fondsenbedrijf N.V. Heerlen 100 Administrative organization consolidation
- APG Service Partners B.V. Heerlen 100 Administrative organization consolidation
- APG Asset Management N.V. Amsterdam 100 Administrative organization consolidation
- APG Asset Management US Inc. State of Delaware 100 Administrative organization consolidation
- APG Investments Asia Ltd. Hong Kong 100 Administrative organization consolidation
- APG Business Information Consultancy (Shanghai)
Shanghai 100 Administrative organization consolidation
Co. Ltd.
- APG Trading B.V. Amsterdam 100 Administrative organization consolidation
- Entis Holding B.V. Amsterdam 70 Investment in participating interest consolidation
Consulltancy on
Utrecht 100 consolidation
- Entis B.V. information technology
APG Liquiditeitenbeheer B.V. Amsterdam -1 Cash management services consolidation
Aspendos Investments Holding B.V. Heerlen 100 Investment in real estate Investment
Drooge Vaate 1 N.V. Amsterdam 100 Investment in infrastructuur Investment
1 The shares are owned by the stichtingen Bewaarneming Fondsen voor Gemene Rekening, in which ABP participates substantially
A full list of capital interests has been filed with the Chamber of Commerce.
Disclosure of auditor's fees
The fees of ABP's external independent auditor and its network are listed in the The fee of ABP's external independent auditor and its network for the audit
following table: of the financial statements 2021 was €0.4 million (2020: €0.4 million). The
fee for APG Groep NV’s external independent auditor and its network for
2021 auditor's fees audit services for the client reports for ABP and the mutual funds for 2021
Other Total
was €3.7 million (2020: €2.8 million). These amounts are included in the
KPMG parts of Total KPMG
above table.
Accountants KPMG KPMG network
NV network network 2020
In addition, the fee of APG Groep NV's external independent auditor and
Audit of the
financial statements 1.2 - 1.2 1.1 its network for audit services for other APG Groep NV clients for 2021 was
Other audit and assurance €0.7 million (2020: €0.5 million). These amounts are not included in the
or engagements 2.9 1.0 3.9 3.0 above table.
Tax consultancy - - - -
Other non-audit services - - - - These amounts are inclusive of VAT and based on the full fee for the fiscal year
to which the financial statements relate, irrespective of whether the activities
Total 4.1 1.0 5.1 4.1 were carried out during the fiscal year.
Contents Financial statements ABP Annual Report 2021 216
Signatories to the financial statements

Heerlen, April 28, 2022
Board of Trustees:
Ms C.M. Wortmann-Kool (Chair) Ms. K. Nauta
Mr. A. Boonen Mr. P. Rosenmöller
Ms. D. Dijkhuis Mr. A.J.M. Sibbing
Mr. P.J.H. Fey Mr. X.J. den Uyl
Ms. A. Gram Ms. Y. Verdonk - van Lokven
Ms. V. van der Meer Mr. A. van Vliet
Ms. C.M. Mulder-Volkers Mr. H.J. van Wijnen

Contents Other information ABP Annual Report 2021 217
Other information
Contents Provisions in the Articles concerning profit appropriation ABP Annual Report 2021 218
Provisions in the Articles concerning

profit appropriation
The Articles do not include a provision governing the profit appropriation.
Contents Actuarial Statement ABP Annual Report 2021 219
Actuarial Statement
Engagement Coordination with the pension fund’s auditor
Stichting Pensioenfonds ABP of Heerlen, the Netherlands, has engaged Towers The procedures and expectations for the audit for the financial year have been
Watson Netherlands B.V. to issue an actuarial statement as referred to in the coordinated on the basis of the guidelines applied by me and the auditor.
Pensions Act on the financial year 2021.
For the review of the technical provisions and for the opinion of the
financial position as a whole, I have set materiality at EUR 2,500,000,000.
Independence The auditor and I have agreed to report observed differences of more than
As certifying actuary, I am independent of Stichting Pensioenfonds ABP, as EUR 125,000,000. These agreements are documented, and the results of my
required under Section 148 of the Pensions Act. I do not perform any findings have been discussed with the auditor.
other activities for the pension fund other than those required for the
actuarial function. I have used the basic administrative data that have been examined by the
auditor in the context of the audit of the financial statements. The auditor
informed me of their findings regarding the reliability (material correctness and
Data set completeness) of the basic administrative data and the other principles that are
The data set on which I based this audit was provided and compiled under essential for my assessment.
the responsibility of the pension fund’s Board of Trustees. The review of
the fund’s technical provisions and the assessment of the fund’s financial
position was based on the financial data that form the basis of the annual Procedures
financial statements. In the process of carrying out these instructions, in accordance with my
statutory responsibility as described in Section 147 of the Pensions Act, I
audited compliance with Sections 126 through 140 of the Pensions Act.
The basic administrative data provided by the pension fund are such that I
have accepted these data as a starting point of the calculations I assessed.
Contents Actuarial Statement ABP Annual Report 2021 220
The following items were part of the procedures for this engagement. Among Taking the above into consideration, I auditedcompliance with Sections
other things, I verified that: 126 through 140 of the Pensions Act, with the exception of Section 132
• adequate technical provisions have been formed in relation to the entirety (capital requirement).
of the pension liabilities;
• the minimum capital requirement and the capital requirement have been The pension fund’s policy funding ratio on the balance sheet date is lower than
established in accordance with statutory provisions; the funding ratio corresponding with the minimum capital requirement.
• the cost-effective contribution meets the statutory requirements;
• the investment policy accords with the prudent-person rule. My opinion of the financial position of Stichting Pensioenfonds ABP is based on
the liabilities and assets present on the balance sheet date.
I also assessed the pension fund’s financial position. My opinion is based on
the liabilities and assets present on the balance sheet date and also on a In my opinion, the financial position is inadequate, because the available capital
consideration of the pension fund’s financial policy. is lower than the capital requirement.
I performed my audit to the effect of obtaining reasonable assurance about the For the record, I note that if, on the balance sheet date, the UFR method
financial statements being free of material misstatements. to be applied by DNB in 2022 is taken into account in the interest-rate term
structure, this would not change my opinion regarding the financial position.
The procedures described and the manner in which these were performed
were in accordance with the standards and practices of the Royal Dutch In the context of this opinion, I refer also to developments after the balance
Actuarial Association, and in my opinion, these form a reliable basis for sheet date as a result of the crisis in Ukraine, as disclosed by the pension fund
my assessment. in its annual report.
Amsterdam, 28 April 2022

Opinion
As a whole, the technical provisions are set to adequate amounts in accordance R.T. Schilder AAG
with the stated calculation principles and principles. Affiliated to Towers Watson Netherlands B.V.
The pension fund capital on the balance sheet date is lower than the
statutory capital requirement, but higher than the minimum statutory
capital requirement.
Contents Independent auditor’s report ABP Annual Report 2021 221
Independent auditor’s report

To: the Board of Trustees of Stichting Pensioenfonds ABP
Report on the audit of the financial statements 2021 included in the annual report
Our opinion
In our opinion the accompanying financial statements give a true and fair view of the financial position of Stichting Pensioenfonds ABP as
at 31 December 2021 and of its results for the year then ended, in accordance with Part 9 of Book 2 of the Dutch Civil Code.
What we have audited
We have audited the 2021 financial statements of Stichting Pensioenfonds ABP (‘the Pension Fund’), based in Heerlen.
The financial statements comprise:
1 the company balance sheet and the consolidated balance sheet as at 31 December 2021;
2 the company statement of income and expenses and the consolidated statement of income and expenses for 2021;
3 the company cash flow statement and the consolidated cash flow statement for 2021; and
4 the notes comprising a summary of the accounting policies and other explanatory information.
KPMG Accountants N.V., a Dutch limited liability company registered with the trade register in the Netherlands under number 33263683, is a member firm of the global organization of independent member firms affiliated to KPMG International Limited, an English entity.
Basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing. Our responsibilities under those
standards are further described in the ‘Our responsibilities for the audit of the financial statements’ section of our report.
We are independent of the Pension Fund in accordance with the 'Verordening inzake de onafhankelijkheid van accountants bij assurance-
opdrachten' (ViO, Code of Ethics for Professional Accountants, a regulation with respect to independence) and other relevant
independence regulations in the Netherlands. Furthermore, we have complied with the 'Verordening gedrags- en beroepsregels
accountants' (VGBA, Dutch Code of Ethics).
Our audit procedures were determined in the context of our audit of the financial statements as a whole. Our observations with respect to
going concern, fraud and non-compliance with laws and regulations and the key audit matters should be viewed in that context and not as
separate opinions or conclusions.
We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Audit approach
Summary
Materiality
— Materiality of EUR 2.5 billion
— Approximately 0.5% of the total equity and provision for pension liabilities
Group audit
100% coverage
Going concern
— Going concern: no significant going concern risks identified
Fraud & Noclar

— Fraud and non-compliance with laws and regulations (Noclar): we identified risk of
override of controls by the Board of Trustees as presumed fraud risk
Our key audit matters

— Valuation of investments
— Valuation of the provision for pension liabilities
Opinion
Unqualified
Materiality
Based on our professional judgement we determined the materiality for the financial statements as a whole at EUR 2.5 billion (2020: EUR
2.3 billion). The materiality is determined with reference to the total of equity and provision for pension liabilities as at 31 December 2021
(approximately 0.5%). We consider the total of equity and provision for pension liabilities as the most appropriate benchmark because it is
a determining factor in calculating the policy funding ratio, which reflects the Pension Fund’s financial position. We have also taken into
account of misstatements and/or possible misstatements that in our opinion are material for the users of the financial statements for
qualitative reasons.
We agreed with the Board of Trustees that misstatements identified during our audit in excess of EUR 125 million would be reported to
them, as well as smaller misstatements that in our view must be reported on qualitative grounds.
Scope of the audit
Group audit, including outsourcing of business processes to service organizations
The Pension Fund has outsourced the management of investments and the administration of pensions to APG Asset Management N.V.
and APG DWS en Fondsenbedrijf N.V., respectively (hereinafter jointly referred to as ‘the service organization’). The financial statements
are prepared on the basis of information regarding the investments and returns on investments provided by APG Asset Management N.V.
and on information regarding the provision for pension liabilities, pension contributions, pension payments, and other financial items
provided by APG DWS en Fondsenbedrijf N.V.
Given our ultimate responsibility for the opinion, we are responsible for obtaining insights into the nature and significance of the services
provided by the service organization and the effect they have on the internal control of the Pension Fund that is relevant to the audit. This
is the basis on which we identify risks of material misstatement and design and perform audit procedures to address these risks.
In conducting our audit we make use of the procedures and findings of other independent auditors relating to the internal controls of the
service organization that are relevant to the Pension Fund, as included in the (Standard 3000A and 3402 type II) service level reports
specifically prepared for that purpose.
Our audit procedures consist of determining which internal controls can be expected as a minimum and discussing the control environment
of the service organization with service organization representatives. Based on that we evaluate the internal controls described in the
Standard 3000A and 3402 reports, the procedures to test their operating effectiveness during 2021, and the findings resulting from those
procedures and discuss these with the other independent auditor.
We also assess the Board of Trustees’ evaluation of the quality of the outsourced business processes performed by the service
organization.
Given our ultimate responsibility for the audit opinion on the financial statements, we are responsible for directing and supervising the audit
procedures for the financial statements to be performed by the auditor of the service organization. We accordingly gave the auditor written
instructions concerning the nature and scope of the procedures to be performed. The auditor conducted the audit, in accordance with our
instructions, using a materiality of EUR 2.5 billion, and also paying particular attention to the key audit matters mentioned below.
The auditor of the service organization reported his findings to us. We evaluated the report, discussed the findings with the auditor,
reviewed the auditor’s audit file, and carried out further audit procedures ourselves, including procedures regarding the control measures in
place at the level of the Pension Fund.
Based on the procedures mentioned above relating to the outsourced business processes and the additional procedures performed by us,
we have obtained sufficient and appropriate audit evidence regarding the investments, investment flows and returns, (changes in)
participants’ data and entitlements resulting in (changes in) the provision for pension liabilities, premium contributions, and benefits.
Audit response to going concern – no significant going concern risks identified
As explained on pages 33 and 145 of the financial statements, the Board of Trustees submitted a recovery plan to De Nederlandsche Bank
(the Dutch Central Bank) in March 2022. In this recovery plan, the Board of Trustees has outlined how it expects to restore the Pension
Fund’s policy funding ratio to the required level within the regulatory recovery period. If the Pension Fund has applied all the available
measures and, despite this, the Pension Fund’s policy funding ratio is not expected to reach the required level within the regulatory
recovery period, the Pension Fund will be forced to curtail the pension entitlements and pension rights. This will ensure that the Pension
Fund is able to continue as a going concern at all times.
Our procedures included, among others:

— considering whether the Board of Trustees’ assessment of the going concern risks includes all relevant information of which we are
aware as a result of our audit;
— considering whether actuarial developments (including the foreseeable trend in life expectancy) and developments in the financial
markets (including developments in the yield curve (rentetermijnstructuur)) indicate significant going concern risks;
— analysis of the development of the financial position of the Pension Fund during the financial year versus regulatory solvency
requirements and compared to the previous financial year to identify indicators that could give rise to significant going concern risks,
and an assessment of the relevant disclosures in the financial statements;
— taking note of the recovery plan submitted to De Nederlandsche Bank (the Dutch Central Bank) and evaluating whether the recovery
plan includes all relevant elements and is consistent with our knowledge and understanding obtained during our audit of the financial
statements;
— taking note of the disclosures with respect to the realization of the recovery plan, as included on pages 33 and 145 of the financial
statements, and determining that these disclosures are adequate.
The outcome of our procedures did not give reason to perform additional audit procedures on the going concern assessment.
Audit response to the risk of fraud and non-compliance with laws and regulations
As part of our audit, we have gained insights into the Pension Fund and its business environment, and we have assessed the design and
implementation and, where considered appropriate, tested the operating effectiveness of the Pension Fund’s risk management in relation
to fraud and non-compliance with laws and regulations. This also includes the internal control measures in place at the external service
providers of the Pension Fund (see section ‘Scope of the audit’).
Our procedures included, among other things, assessing the code of conduct, the whistleblowing procedures, the periodic incident and
compliance reports, and the procedures at the Pension Fund to investigate indications of possible fraud or non-compliance with laws and
regulations. Furthermore, we performed relevant inquiries with the Board of Trustees. Our audit procedures included, among others:
— evaluation of ancillary positions held by members of the Board of Trustees, with special attention to procedures and governance in view
of possible conflicts of interest;
— evaluation of correspondence with regulators and supervisory authorities (including De Nederlandsche Bank (the Dutch Central Bank)
and Autoriteit Financiële Markten (Dutch Authority for the Financial Markets));
— evaluation of investigation reports on indications of possible fraud or non-compliance with laws and regulations.
In addition, we performed procedures to obtain an understanding of the laws and regulations that are applicable to the Pension Fund and
identified the following areas as those most likely to have a material effect on the financial statements:
— ‘Pensioenwet’ (Pensions Act);

— ‘Wet verplichte deelneming in een bedrijfstakpensioenfonds’, or ‘Wet Bpf 2000’ (law on obligatory participation in a sectoral pension
fund);
— ‘Besluit Financieel toetsingskader pensioenfondsen’, or ‘Bftp’ (decree on the financial assessment framework for pension funds);
— ‘Algemene verordening gegevensbescherming’ (AVG, or General Data Protection Regulation, GDPR).
We evaluated the fraud and non-compliance risk factors to consider whether those factors indicate a risk of material misstatement in the
financial statements.
We assessed the presumed fraud risk on revenue recognition as not relevant, given the nature of the revenue and due to the limited
possibilities of material influence on revenue recognition.
Based on the above and on the auditing standards, we identified the following fraud risk that is relevant to our audit, including the relevant
presumed risks laid down in the auditing standards, and responded as follows:
Management override of controls (a presumed risk)

Risk:
- The Board of Trustees is in a unique position to prepare fraudulent financial statements and manipulate accounting records by
overriding controls that otherwise appear to be operating effectively, such as estimates related to the valuation of the provision for
pension liabilities and the valuation of the investments.
Audit response:
- We have evaluated the design and implementation and, where considered appropriate, tested the operating effectiveness of the
internal controls that mitigate the fraud risk, including the internal controls in place at the service providers to which the Pension
Fund has outsourced business processes.
- We have performed an analysis to identify (administrative) journal entries with an increased risk of fraud. In case we identified
journal entries with an increased risk of fraud, we performed additional audit procedures to address to the identified risks. These
procedures also include validating transactions with source documentation.
- We have evaluated significant estimates and also judgements and assumptions by the Board of Trustees with respect to the
valuation of the provision for pension liabilities and the valuation of the investments. For a description of our procedures in this
regard, we refer to the key audit matters related to the valuation of the provision for pension liabilities and the valuation of the
investments.
- We included elements of unpredictability in our audit approach.
Our procedures to address to identified risks of fraud did not result in a key audit matter.
We communicated our risk assessment, audit responses and results to the Board of Trustees.
Our audit procedures did not reveal indications and/or other reasonable suspicion of fraud and non-compliance with laws and regulations
that are considered material for our audit.
Our key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements.
We have communicated the key audit matters to the Board of Trustees. However, the key audit matters are not a comprehensive reflection
of all matters discussed. In our audit and in determining and evaluating our key audit matters, we took into account the possible effects of
COVID-19 on the Pension Fund and the financial statements. This did not result in an adjustment or addition to our key audit matters.
Valuation of investments
Description
The investments of the Pension Fund constitute a significant item on its balance sheet. The investments of the Pension Fund amount to approximately 99.7% of the
balance sheet total. Under the Pensions Act, investments must be measured at fair value. Note 1 to the financial statements states that 74% of the Pension Fund’s
investments are valued directly at quoted market prices, 7% of the Pension Fund’s investments are valued at derived market prices, and 19% of the investments are
valued on the basis of valuation models and techniques. Determining the fair value of this last category of investments is relatively complex and involves elements of
management judgement.
Making these estimates requires significant judgement by the Board of Trustees for which it makes use of models. Given the influence this has on the valuation of the
investments, the balance of income and expenses, the Pension Fund equity, and the policy funding ratio, we consider the valuation of investments to be a key audit
matter.
In the notes on pages 135 through 137, the Pension Fund describes the accounting policies used. Note 1 states the valuation methods used and key assumptions
made for the valuation of these investment categories.
Evaluating the accounting policies and determining the accuracy and adequacy of the disclosures was part of our procedures.
Our response
We performed the following procedures:
— We evaluated the accounting policies used for the valuation of these investments and the more detailed description of the accounting policies included in
the ’Handboek Waarderingen’ (Valuations Manual of ABP) for compliance with law as well as with the ‘Richtlijnen voor de Jaarverslaggeving’ (RJ, Dutch
Accounting Standards Board guidelines).
— We tested the internal controls that are in place to ensure the reliability of the valuation of these investments.
— We determined that the notes to the financial statements contain adequate disclosures concerning the accounting policies and the degree of estimation uncertainty
with regard to the valuation of these investments.
The auditor of the service organization reported his findings relating to his audit of these investments to us. We evaluated the report, discussed the findings with the
service organization’s auditor, and reviewed the auditor’s audit file.
We:
— used Standard 3402 type II reports and analyzed these for adequacy of the scoping, any findings, and the impact of these findings on the audit procedures;
— reconciled the audited report covering the investments with the financial administration and the financial statements;
— established that the investments based on quoted or derived market prices had been investigated with the help of a valuation specialist. The valuation specialist
compared the reported valuations with independently determined valuations based on published market information obtained from independent sources;
— established that for investments of which the valuation is based on net present value calculations and other appropriate valuation models and techniques, a
selection of individually significant investments had been investigated with the help of a valuation specialist. In doing so, we evaluated the appropriateness of the
calculation models used, reconciled input data with data from objective sources, and determined the mathematical accuracy of the figures. We tested the source
data, including market data; and
— established that the valuation of investments based on valuation statements provided by external parties, if possible had been tested against recent financial
statements audited by other independent auditors. In cases where financial statements for which an unqualified audit opinion had been issued were not available
in time, the reliability of the valuation as provided by the external parties was established by testing the estimates provided by these external parties in previous
years against audited financial statements that became available at a later date.
Our observation
We determined that the accounting policies and valuation methods used for the investments comply with the applicable reporting standards and are appropriate for
determining a fair value for these investments.
We believe that the valuation of the investments in the financial statements has been determined in an acceptable manner. The disclosure on the composition of and
the movements in the investments in the financial statements is adequate.
Valuation of the provision for pension liabilities

Description
The provision for pension liabilities constitutes a significant item in the Pension Fund's balance sheet and is measured at fair value (market value). Determining the fair
value of the provision for pension liabilities involves a calculation in which the pension rights of participants are translated into expected future cash flows (benefit
payments) using important estimates of life expectancy, cost levels, and disability. The cash flows are then discounted to net present value at the market interest rate
(derived from the yield curve (rentetermijnstructuur) published by De Nederlandsche Bank (the Dutch Central Bank)).
Making estimates requires extensive judgement by the Board of Trustees, using actuarial models, and the Board of Trustees draws on the assistance by actuarial
experts. Given its complexity and its influence on the size of the provision for pension liabilities, the balance of income and expenses, equity, and the (policy) funding
ratio, we regard the valuation of the provision for pension liabilities as a key audit matter.
The Board of Trustees has included the accounting policies and assumptions related to the provision for pension liabilities in the notes to the financial statements on
pages 138 through 140. The note on page 135 shows that there have been changes in accounting estimates. The sensitivity of the calculation of the provision for
pension liabilities to estimates is discussed in the risk paragraph.
Our response
In our audit, we make use of the procedures of the certifying actuary appointed by the Pension Fund. At the start of the audit and on its conclusion, we agreed with the
certifying actuary on the approach and discussed the points of attention and the outcomes.
The service organization's auditor reported his findings to us concerning his audit of the provision for pension liabilities. We evaluated the report, discussed the findings
with the auditor, and reviewed the auditor's audit file.
We evaluated the methods of estimation and the assumptions used by the Board of Trustees. In doing so, we evaluated whether the method of estimation and the
assumptions used are consistent, prudent and up to date. We evaluated the way in which the Board of Trustees supported the assumptions used by assessing their
historical reliability and generally updated assumptions such as life expectancy. We discussed the estimation methods and assumptions used with the certifying
actuary. We evaluated the actuarial statement as included in the other information and the procedures performed in the file of the certifying actuary.
Our procedures also involve evaluating the outcome of the actuarial analysis of the balance of income and expenses in relation to previously made estimates and cash
flow projections. For these procedures, we made use of our own actuarial specialist. We also evaluated the accounting policies and the accuracy and adequacy of the
notes to the financial statements.
Our observation
We believe that the valuation of the provision for pension liabilities in the financial statements has been determined in an acceptable manner. The disclosure on the
composition of and the movements in the provision for pension liabilities is adequate, as is the disclosure on the applied changes in accounting estimates.
Report on the other information included in the annual report
In addition to the financial statements and our auditor’s report thereon, the annual report contains other information.
Based on the following procedures performed, we conclude that the other information:
— is consistent with the financial statements and does not contain material misstatements;
— contains the information as required by Part 9 of Book 2 of the Dutch Civil Code.
We have read the other information. Based on our knowledge and understanding obtained through our audit of the financial statements or
otherwise, we have considered whether the other information contains material misstatements.
By performing these procedures, we comply with the requirements of Part 9 of Book 2 of the Dutch Civil Code and the Dutch Standard
720. The scope of the procedures performed is less than the scope of those performed in our audit of the financial statements.
In addition, we devoted specific attention to transparency with respect to the administrative expenses. In the chapter headed “Dealing with
our participants’ money responsibly” in the report of the Board of Trustees, the Pension Fund provides insight into the costs of pension
administration, asset management, and transaction costs, including an explanation of the assumptions and estimates made and an
analysis of these costs.
Acting on our instructions, the service organization's auditor performed agreed-upon procedures relating to the administrative expenses
and reported his findings to us. We evaluated the report, discussed the findings with the auditor, and reviewed the auditor’s audit file.
Furthermore, we assessed the reasonableness of the assumptions and estimates made by the Board of Trustees in relation to the
administrative expenses on the basis of the principles and calculation methods of the Pensioenfederatie (Federation of Dutch Pension
Funds).
The Board of Trustees is responsible for the preparation of the other information, including the information as required by Part 9 of Book 2
of the Dutch Civil Code.
Report on other legal and regulatory requirements
Engagement
We were engaged by the Board of Trustees on 18 June 2015 as auditor of the Pension Fund for the audit of the financial year 2016 and
have operated as the statutory auditor ever since that financial year.
No prohibited services
We have not provided prohibited services as referred to in Article 5(1) of the EU Regulation on specific requirements regarding statutory
audits of public-interest entities.
Services provided
For the period to which our statutory audit relates, in addition to this audit, we have provided the following services to the Pension Fund
and its controlled undertakings:
— other audit and assurance engagements.
These services also include those carried out by the independent auditor of APG Groep N.V.
Description of the responsibilities regarding the financial statements
Responsibilities of the Board of Trustees for the financial statements
The Board of Trustees is responsible for the preparation and fair presentation of the financial statements in accordance with Part 9 of Book
2 of the Dutch Civil Code. Furthermore, the Board of Trustees is responsible for such internal control as it determines is necessary to
enable the preparation of the financial statements that are free from material misstatement, whether due to fraud or error. In that respect
the Board of Trustees is responsible for the prevention and detection of fraud and non-compliance with laws and regulations, including
determining measures to resolve the consequences of it and to prevent recurrence.
As part of the preparation of the financial statements, the Board of Trustees is responsible for assessing the Pension Fund’s ability to
continue as a going concern. Based on the financial reporting frameworks mentioned, the Board of Trustees should prepare the financial
statements using the going concern basis of accounting unless the Board of Trustees either intends to liquidate the Pension Fund or to
cease operations, or has no realistic alternative but to do so. The Board of Trustees should disclose events and circumstances that may
cast significant doubt on the Pension Fund's ability to continue as a going concern in the financial statements.
Our responsibilities for the audit of the financial statements
Our objective is to plan and perform the audit engagement in a manner that allows us to obtain sufficient and appropriate audit evidence
for our opinion.
Our audit has been performed with a high, but not absolute, level of assurance, which means we may not have detected all material errors
and fraud during our audit.
Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected
to influence the economic decisions of users taken on the basis of these financial statements. The materiality affects the nature, timing,
and extent of our audit procedures and the evaluation of the effect of identified misstatements on our opinion.
A further description of our responsibilities for the audit of the financial statements is located at the website of de ‘Koninklijke Nederlandse
Beroepsorganisatie van Accountants’ (NBA, Royal Netherlands Institute of Chartered Accountants) at www.nba.nl/ENG_oob_01. This
description forms part of our auditor’s report.
Utrecht, 28 April 2022
KPMG Accountants N.V.
P. Smit RA
Contents Assurance report by the independent auditor ABP Annual Report 2021 235
Assurance report of the independent auditor

To: the Board of Trustees of Stichting Pensioenfonds ABP
Our conclusion
We have reviewed the information in the section ‘Results: Sustainable and responsible investments 2021’ (p. 36-49) in the 2021 annual
report (hereafter: ‘the Report’) of Stichting Pensioenfonds ABP (hereafter: ‘the Pension Fund’) for the year ended 31 December 2021. A
review is aimed at obtaining a limited level of assurance.
Based on the procedures performed nothing has come to our attention that causes us to believe that the information in the section
‘Results: Sustainable and responsible investments 2021’ (p. 36-49; hereafter: ‘the information on Responsible Investments’) is not
prepared, in all material respects, in accordance with the reporting criteria as described in the ‘Reporting criteria’ section of our report.
Basis for our conclusion
We performed our review in accordance with Dutch law, including Dutch Standard 3000A, ‘Assurance-opdrachten anders dan opdrachten
tot controle of beoordeling van historische financiële informatie (attest-opdrachten)’ (assurance engagements other than audits or reviews
of historical financial information (attestation engagements)). Our responsibilities in this regard are further described in the ‘Auditor’s
responsibilities’ section of our report.
We are independent of the Pension Fund in accordance with the ‘Verordening inzake de onafhankelijkheid van accountants bij assurance-
opdrachten’ (ViO, Code of Ethics for Professional Accountants, a regulation with respect to independence) and other relevant
independence regulations in the Netherlands. Furthermore, we have complied with the ‘Verordening gedrags- en beroepsregels
accountants’ (VGBA, Dutch Code of Ethics).
KPMG Accountants N.V., a Dutch limited liability company registered with the trade register in the Netherlands under number 33263683, is a member firm of the global organization of independent member firms affiliated to KPMG International Limited, an English entity.
We believe the assurance evidence we have obtained is sufficient and appropriate to provide a basis for our conclusion.
Reporting criteria
The information on Responsible Investments needs to be read and understood together with the reporting criteria. The Pension Fund is
solely responsible for selecting and applying these reporting criteria, taking into account applicable law and regulations related to reporting.
The reporting criteria used for the preparation of the Report are described in the section ‘Reporting Guidelines’ in the Report.
Limitations to the scope of our review
The Report includes prospective information such as ambitions, strategy, plans, expectations, estimates and risk assessments. Inherently
the actual future results are uncertain. We do not provide any assurance on the assumptions and achievability of prospective information in
the Report.
References to external sources or websites in the Report are not part of the information on Responsible Investments itself as reviewed by
us. Therefore, we do not provide assurance on this information.
Responsibilities of the Board of Trustees
The Board of Trustees is responsible for the preparation of the information on Responsible Investment in accordance with the applicable
criteria as described in the ‘Reporting Guidelines' section of the Report, including the identification of the intended users and the
applicability of the criteria used for the aims of the intended users.
Furthermore, the Board of Trustees is responsible for such internal control as it determines is necessary to enable the preparation of the
Report that is free from material misstatement, whether due to fraud or error.
The Board of Trustees is responsible for overseeing the Pension Fund’s reporting process.
Auditor’s responsibilities
Our responsibility is to plan and perform our review in a manner that allows us to obtain sufficient and appropriate assurance evidence for
our conclusion.
Procedures performed to obtain a limited level of assurance are aimed to determine the plausibility of information and vary in nature and
timing, and are less in extent, compared to a reasonable assurance engagement. The level of assurance obtained in a limited assurance
engagement is substantially lower than the assurance that would have been obtained had a reasonable assurance engagement been
performed.
We apply the ‘Nadere Voorschriften Kwaliteitssystemen’ (NVKS, Regulations for Quality management systems) and accordingly maintain a
comprehensive system of quality control, including documented policies and procedures regarding compliance with ethical requirements,
professional standards and applicable legal and regulatory requirements.
We have exercised professional judgment and have maintained professional skepticism throughout the review, in accordance with Dutch
Standard 3000A, ethical requirements and independence requirements.
Our review included among others:
— performing an analysis of the external environment and obtaining an understanding of relevant societal themes and issues, and the
characteristics of the organization;
— evaluating the appropriateness of the reporting criteria used, their consistent application, and related disclosures included in the
Report. This includes the evaluation of the results of stakeholder and the reasonableness of estimates made by the Board of Trustees;
— obtaining an understanding of the reporting processes for the reported information, including obtaining a general understanding of
internal control relevant to our review;
— identifying areas of the Report where a material misstatement, whether due to fraud or error, is most likely to occur. Designing and
performing assurance procedures responsive to these areas to establish the plausibility of the Report. These procedures included,
amongst others:
– interviewing relevant staff of the Pension Fund and its service organization APG responsible for the societal strategy, policy and
results;
 interviewing relevant staff responsible for providing the information for, carrying out internal control procedures over, and
consolidating the data in the Report;
 obtaining assurance information that the Report reconciles with underlying records of the Pension Fund and its service organization
APG; and
 reviewing, on a limited test basis, relevant internal and external documentation;
— evaluating the consistency of the information on Responsible Investments with the information in the annual report which is not
included in the scope of our review;
— evaluating the presentation, structure, and content of the Report;
— considering whether the Report as a whole, including the disclosures, reflects the purpose of the reporting criteria used.
We have communicated with the Board of Trustees of the Pension Fund regarding, among other matters, the planned scope and timing of
the review and significant findings identified during our review.
Utrecht, 28 April 2022
KPMG Accountants N.V.
P. Smit RA
Contents Supplementary information ABP Annual Report 2021 239
Supplementary information
Contents About this report ABP Annual Report 2021 240
About this report

This report includes our next steps towards an integrated report. We report We also state clearly where readers can find more information on sustainable
on the financial results and developments together with the results and and responsible investment on our website, for example.
developments as a sustainable and socially responsible enterprise. We also
show how ABP adds value, particularly for our participants and employers. As
our primary stakeholders, they are at the center of all our operations. Materiality
The transition to integrated reporting is a progressive process for ABP. We The Integrated Reporting (IR) framework and Global Reporting Initiative (GRI)
intend to embed integrated reporting, integrated thinking, and the associated Standards pivot on the materiality principle. This means that, on the basis of
policy step by step throughout our organization. Our goal is to work toward a structured dialog with and/or survey of stakeholders, it can be determined
a fully integrated annual report in the years ahead, following the widely used which subjects they consider to be important to read about and which are
international integrated reporting framework of the International Integrated important for reporting. At ABP, we carried out an initial materiality analysis
Reporting Council (IIRC) when possible. among our stakeholders in the reporting year, which resulted in a list of
topics that they considered relevant in the reporting year. These topics were
used to create a provisional materiality matrix that has been included in this
Value creation model report. The most important material topics from this matrix also provided the
structure for the results section of this annual report.
This report presents a new version of our two-step value creation model. This We will carry out a more comprehensive materiality analysis in the second half
model first shows how we deploy the various forms of capital and knowledge in of 2022.
realizing our goals and how we strive to generate added value through our core
activities. This is followed by detailed information in relation to each element.
These two steps jointly reflect ABP's impact on the stakeholders and on society.
This value creation model is also based on the outlines of the IIRC framework.
In the online version of our annual report, we have made the value creation
model interactive with references to the relevant sections of the report of the
Board of Trustees.
Contents About this report ABP Annual Report 2021 241
Scope and demarcations of the report • the main IR principles of the IIRC1: strategic focus and future orientation,
creation of cohesion between the various sections of the report,
This report covers Stichting ABP's 2021 fiscal year, which runs from January stakeholders and stakeholder dialog, materiality, conciseness, reliability and
1, 2021 through December 31, 2021. ABP presents the company financial completeness, and consistency and comparability;
statements before the consolidated financial statements, which is not • GRI Standards: ABP takes the GRI Standards as the model for
usual practice. We have adopted this approach because company financial its sustainability reporting, in so far as relevant. We apply these
statements provide a more accurate view of ABP's financial position and tie standards indirectly.
in best with the management policy information provided in the Board of
Trustees report and in other external publications.
Non-financial information assurance
The consolidated financial statements report on entities in which ABP holds a
capital interest that results in control over management decisions and financial The non-financial information that we formerly presented in our Sustainable
policy, such as APG. and Responsible Investment report was subject to an assurance engagement
by the independent auditor. The auditor has issued a limited assurance report
for the Investing in a livable world (see page 36). It is our ambition to
Reporting guidelines further expand the scope of the non-financial information assurance in the
years ahead.
The annual report comprises the report of the Board of Trustees, the report of
the Supervisory Board, the report and opinion of the Accountability Body and
the financial statements. The 2021 financial statements have been prepared on Additional information
the basis of generally accepted financial reporting policies in the Netherlands
and the statutory provisions governing financial statements set out in Book 2, Additional information on Sustainable and Responsible Investment is available
Part 9, of the Dutch Civil Code and the Dutch Accounting Standards (Richtlijnen on our website.
voor de Jaarverslaggeving).
This ABP report also provides information on topics of material and societal Responses to the report
relevance, including governance, ABP's role in society, and ABP’s approach to
sustainable and responsible investment. We follow the statutory guidelines of We welcome any questions or comments with regard to our report. Please
the Code of the Dutch Pension Funds and the Pensions Act and have also email these to us at jaarverslag@abp.nl.
adopted the following reporting guidelines:
1 Around the middle of 2021, the IIRC and SASB merged to become the Value Reporting Foundation.
Personal details
This section lists the personal details of the
members of the Stichting Pensioenfonds ABP
Board of Trustees alongside their ancillary
positions. The section continues with lists
of the members of the Board of Trustees
committees, the Supervisory Board and the
Accountability Body.
Contents Personal details ABP Annual Report 2021 243
Board of Trustees Ancillary positions

Member of the Amsterdam Sinfonietta Supervisory Board, Chair of the Care
Ms. C.M. Wortmann-Kool, June 27, 1959 Nederland Supervisory Board, Vice Chair of Stichting Aandelen Remeha,
Independant Chair Managing Director of VRPF BV, Member of the Stichting Royal Haskoning
• Appointed January 1, 2015 DHV Nederland B.V. Board of Trustees, Chair of the Eumedion Governing and
• Term ends January 1, 2023 Executive Board, Chair of the GGN Mastering Credit NV Supervisory Board,
Member of the Geldersch Landschap en Kastelen Board, Managing Director of
Ancillary positions Beleggingsmaatschappĳ Buren BV, Member of the Invest-NL Scale-Up Financing
Member of Aegon NV Supervisory Board, Member of Het Kadaster Supervisory Steering Committee.
Board (until March 1, 2021), Member of the Royal DSM N.V. Board of
Supervisory Directors, Chair of Save the Children Nederland Supervisory Board Mr. P.J.H. Fey, July 4, 1965
(until January 31, 2022)1, Member of the Prix Veuve Cliquot zakenvrouw van het Employees
jaar Jury, Member of the AFM Capital Markets Committee. • Appointed May 1, 2017
• Term ends May 1, 2025
Mr. A. Boonen, January 30, 1982
Employees Ancillary positions
• Appointed January 1, 2021 Chair of CNV Connectief (as from May 19, 2021) and Chair of CNV Overheid
• Term ends January 1, 2025 en Publieke Diensten, Vice Chair of CNV Vakcentrale, Vice-President of CESI,
Member of the Social and Economic Council of the Netherlands, Member of
Ancillary positions the Stichting van de Arbeid Board, Member of the Vereniging van Katholieke
Member of the FNV Board of Trustees, Member of the Stichting Akzo Maatschappelijke Organisaties (VKMO) SI Board.
Pensioenfonds Board of Trustees, Member of the Deventer LTS Audit
Committee (until July 1, 2021), Member of the Zuss kinderopvang Ms. A. Gram, December 14, 1965
Parents’ Council. Employees
• Appointed June 1, 2021
Ms. M. Doornekamp, July 24, 1957 • Term ends June 1, 2025
Employers
• Appointed April 1, 2009 Ancillary positions
• Term ends October 1, 2021 Executive adviser balance management at Pensioenfonds ING (until January
1, 2022), Chair of the Pensioenfonds IBM Investment Committee, Member
of the PFZW Supervisory Board (until December 1, 2021), Chair of the
Pensioenfonds HAL Review Committee, Member of the SPH Pensioenfonds
Huisartsen Investment and Balance Management Committee, Member of Ms. K. Nauta, March 6, 1983
the Pensioenfonds Horeca & Catering Supervisory Board (until December Employers
31, 2021), adviser to the SP UWV Balance Management Committee, Chair • Appointed March 1, 2019
of the ASN Impact Investors Supervisory Board, Member of the Eumedion • Term ends March 1, 2023
Governing Board.
Ancillary positions
Ms. V. van der Meer – Gangapersadsing, January 28, 1979 Member of the BPF Horeca en Catering Executive Board (until October 1,
Employers 2021), Member of the Pensioenfonds Thales Supervisory Board (until January 1,
• Appointed April 1, 2022 2022), Director of Pensioenfonds Wolters Kluwer Nederland (as from October
• Term ends April 1, 2026 1, 2021).
Ancillary positions Mr. P. Rosenmöller, May 11, 1956

Independant pensions adviser. Employers
• Appointed December 1, 2021
Ms. C.M. Mulder-Volkers, June 3, 1966 • Term ends December 1, 2025
Retired employees
• Appointed April 1, 2015 Ancillary positions
• Term ends April 1, 2023 Member of the Nationale Goede Doelen Postcodeloterĳ Supervisory Board,
Chair of the GroenLinks parliamentary group in the Senate, Member of the
Ancillary positions Professional Performance of Professionalism in Transition Advisory Board,
Chair of the Pensioenfonds Rijn- en Binnenvaart Supervisory Board, Key PME various Recommendations Committees at Utrecht University, Member of the
Internal Audit Officer (until December 31, 2021), Chair of the Board of Appeal, Scholengemeenschap Bonaire Supervisory Board.
Member of the Pensioenfonds SPT Board of Trustees (as from July 1, 2021),
Member of the Parkinson NL Supervisory Board (as from March 25, 2021), Mr. A.J.M. Sibbing, April 5, 1959
non-executive director of the Adelbert College in Wassenaar (until May 1, 2021). Employers
• Appointed March 7, 2019
• Term ends March 7, 2023
Ancillary positions
Chair of the Instituut GAK Investment Committee (as from November 30, 2021),
Chair of the Rabo PGGM PPI Supervisory Board (until August 1, 2021), Trustee/
Treasurer at Fonds Sluyterman van Loo.
Mr. M. Snel, October 29, 1970 Mr. X.J. den Uyl, May 21, 1953
Employers Retired employees
• Appointed September 1, 2020 • Appointed April 1, 2015
• Term ends September 1, 2021 • Term ends April 1, 2023
Ancillary positions Ancillary positions

Chair of the Royal IHC (2020) Supervisory Board, Chair of Mr. Hans Chair of Pensioenfonds PWRI, Member of the Principles Responsible
van Mierlo Stichting (think tank for social liberalism) (2020), Chair of the Investment (PRI) Board.
Nationale Hypotheekgarantie (Stichting Waarborgfonds Eigen Woningen) Board
of Supervisory Directors (2020), Chair of the Nogepa Executive Committee (as Mr. A. van Vliet, February 16, 1967
from May 6, 2021). Employees
• Appointed February 16, 2016
Mr. P.A. Stork, May 19, 1967 • Term ends February 16, 2024
Retired employees
• Appointed October 1, 2017 Ancillary positions
• Term ends January 1, 2022 Member of the Het Nederlandse Pensioenfonds Board of Trustees, Member
of the Van Ravesteyn Fonds Board of Trustees, Member of the Havensteder
Ancillary positions Supervisory Board, Member of the Pensioenfederatie Executive Committee,
Chair of the CBR Pensioenfonds Indexation Supplement Deposit Investment Member of the VTW Finance Committee (as from November 1, 2021).
Committee, Member of the Stichting Bedrĳfstak Pensioenfonds voor het
Beroepsvervoer over de Weg Board of Trustees, Professor of Financial Markets Mr. J.P.C.M. van Zijl, October 13, 1952
and Instruments at Vrĳe Universiteit Amsterdam. Employers
• Appointed April 1, 2016
• Term ends April 9, 2021
Ancillary positions
Chair of World Skills Netherlands, Chair of Stichting Willem Drees-lezing, Chair
of Parkinson Alliantie Nederland.
The next section lists the personal details of the members of Ms. D. Dijkhuis, April 1, 1972
the Executive Board (formed January 1, 2022). Executive director
• Appointed January 1, 2022
Mr. H.J. van Wijnen, November 23, 1967 • Term ends January 1, 2026
Chair of the Executive Board
• Appointed January 1, 2022 Ancillary positions
• Term ends January 1, 2026 Member of the Stichting Waarborgfonds Sociale Woningbouw Model
Committee, Member of the Stichting Tuchtrecht Banken Board of Trustees.
Ancillary positions
Member of the Supervisory Board and Chair of the Audit Committee of
Theater en Kunstencentrum De Kom Nieuwegein, Member of the Maatschappij Audit Committee
van Welstand Supervisory Board1, Chair of the Stichting Eleven Floawers
Foundation Board, Chair of the Stichting Eleven Floawers Foundation Board, Mr. P.A. Stork (Chair until January 1, 2022)
Secretary of the Stichting Ondersteuning Hervormd Vreeswijk, Secretary of the Ms. C.M. Mulder-Volkers
Stichting Vrienden Lelie Zorggroep. Ms. M. Doornekamp (until October 1, 2021)
Mr. P.J.H. Fey
Ms. Y. Verdonk - van Lokven, November 20, 1964 Ms. K. Nauta
Executive director
• Appointed February 1, 2022
• Term ends February 1, 2026 Pension Policy Board Committee
Ancillary positions Ms. C.M. Wortmann-Kool (Chair)

Member of Outer Circle Quist Executive Coaches, Member of the Koninklĳk Mr. A. Boonen
Instituut voor de Tropen Membership Council. Mr. P.J.H. Fey
Ms. C.M. Mulder-Volkers
Ms. K. Nauta
Mr. P. Rosenmöller (as from December 1, 2021)
Mr. M. Snel (until September 1, 2021)
Mr. A. van Vliet
Mr. J.P.C.M. van Zijl (until April 9, 2021)
Investment Policy Board Committee Board of Appeal
Mr. M. Snel (Chair) (until September 1, 2021) Board of Trustees members

Ms. M. Doornekamp (until October 1, 2021) Ms. C.M. Mulder-Volkers, June 3, 1966
Ms. A. Gram (as from June 1, 2021)
Mr. A.J.M. Sibbing (Chair as from September 1, 2021) External members
Mr. P.A. Stork (until January 1, 2022) Mr. R. Barnhoorn, August 6, 1964
Mr. X.J. den Uyl Mr. H.C.J.L. Borghouts, February 7, 1943
Mr. A. van Vliet Mr. M. van Seventer, July 15, 1953
Ms. E.S.M. van Zadelhoff, March 2, 1960
Risk and Balance Board Committee

Supervisory Board
Mr. X.J. den Uyl (Chair)
Mr. A. Boonen Mr. H.A.J. Hannen, February 8, 1948
Ms. A. Gram (as from June 1, 2021) Chair
Mr. A.J.M. Sibbing
Mr. J.P.C.M. van Zijl (until April 9, 2021) Mr. P. de Groot, October 12, 1958
Independent adviser, director and supervisory officer, Member of the
Hypotheekfondsen Syntrus Achmea Real Estate & Finance Supervisory Board
Remuneration Committee (until the middle of 2021), Chair of the Pensioenfonds Delta Lloyd Supervisory
Board, Member of the Pensioenfonds Architectenbureaus Board of Trustees,
Ms. C.M. Wortmann-Kool (Chair) Member of the Woningborg Holding B.V. Supervisory Board, external member
Mr. A. Boonen of the Rabobank Pensioenfonds Audit & Risk Committee, Member of the
Mr. A.J.M. Sibbing Pensioenfonds De Nederlandsche Bank Board of Trustees.
Mr. M. Snel (until September 1, 2021)
Ms. C.M. Mulder-Volkers Ms. N.C.G. Loonen, June 30, 1972
Member of the Rutgers Supervisory Board, Member of College van Toezicht
Auteursrechten, Member of the IPPF Audit Committee, adviser to TOSCA.
Ms. J.F.M. van der Meer, April 15, 1964 On behalf of active participants
Independent adviser at Itch Consultancy, external member of the Mr. A.J. Boekestijn, September 27, 1959
Bedrĳfstakpensioenfonds voor de Banden- en Wielenbranche Audit Committee, Ms. M. van den Bosch, October 17, 1978
Chair of the Algemeen Pensioenfonds KLM Supervisory Board, Member of the Mr. E.W.P. van Boven, May 6, 1957 (Chair)
Stichting Natuur- en Milieuwacht Berkel en Rodenrĳs Board. Mr. R.G.M. Bronswijk, May 23, 1963
Mr. J.J. de Deken, September 17, 1963
Ms. C.E. Roozemond, August 13, 1955 Mr. P.A. Eijkelenkamp, April 27, 1961
Non-executive director of the ABN-AMRO company pension fund, Member Ms. S. Faes, May 21, 1988
of the BPF Horeca en Catering Executive Board, Member of the Frits Ms. J.E.M. van Langeraad-Goes, November 25, 1969
Goldschmeding Stichting voor Mens, Werk en Economie Supervisory Board. Ms. L. den Hartog, May 15, 1984
Mr. J.A. van Nie, January 1, 1956
Ms. M.L. van Muijen, October 7, 1963
Accountability body Mr. J. van Noortwijk, March 26, 1988
Ms. I.M.M.A. Offermans, April 25, 1973
On behalf of employers Ms. M.N. Payton, March 16, 1985
Mr. R. Blankemeijer, September 18, 1966 Mr. P. van der Spoel, June 11, 1966
Ms. J. Broere, July 3, 1974 Ms.P.S. van Straten, September 2, 1980
Mr. J.E. van der Boon, May 10, 1960 Ms. A.P. Tay, July 22, 1959
Mr. D.J. Diederix, August 17, 1952 Mr. S.X. de Vrije, July 6, 1976
Mr. A. Guijt, November 27, 1959
Ms. L.J. de Haan, September 10, 1993 On behalf of retired participants
Mr. P.B.J. Huisman, January 27, 1964 Ms. M.J.J. de Boer, March 15, 1950
Mr. A. Jonkman, September 13, 1959 (Vice Chair) Ms. J.A.R.M. van Egmond, April 17, 1951
Ms. M.K.E. Linschoten, February 24, 1989 Ms. V.M.C. van Geen, November 4, 1946
Mr. M. Rensen, August 05, 1963 Mr. W.F. Golta, April 4, 1946
Mr. P.H. Seesing, February 21,1974 Ms. G. Gorter, November 15, 1953
Mr. R. Vermaat, December 3, 1983 Mr. A. de Graaf, August 4, 1947
Ms. M.L.A. van der Wegen, June 22,1963 Mr. B.M. Groen, December 8, 1952
Mr. V.P. Wongsowinangoen, August 31,1973 Mr. J. van Harmelen, May 13, 1944
Mr. D.V. Hindriks, November 8, 1953
Mr. J.G.A. Leijh, March 13, 1949
Mr. B.M.S. van Praag, February 28, 1939
Mr. J.D. Smit, February 11, 1951 Mr. R.L.S. Verjans, March 19, 1976
Mr. L.Weeren, February 18, 1952 Operations Director (until January 1, 2022)
Mr. H.E.J.J. van Wijck, December 25, 1944
Other positions
Member of the Pensioenfonds AC Nielsen Review Committee.
Key function holders
Mr. B.H.G. Damoiseaux, November 24, 1982
Key Actuarial Officer Compliance Officer
Mr. M. Wiesemann, March 10, 1959 (until July 1, 2021)
Mr. R. Schilder, September 11, 1976 (as from July 1, 2021)
External Parties
Key Internal Audit Officer
Mr. F.A. Toebosch, September 20, 1968 (until January 1, 2022) Certifying Actuary
Mr. T.E. Wolffenbuttel, October 6, 1977 (as from January 1, 2022) WillisTowersWatson
Key Risk Management Officer External Auditor

Mr. A. Laghrich, September 19, 1979 (until January 1, 2022) KPMG Accountants NV
Mr. P. Poppe a.i., February 19, 1964 (as from January 1, 2022)
Executive Office
Mr. H.J. van Wijnen, November 23, 1967

Managing director (until January 1, 2022)
Other positions
Member of the Supervisory Board and Chair of the Audit Committee of Theater
en Kunstencentrum De Kom Nieuwegein1, Member of the Maatschappij
van Welstand Supervisory Board1, Chair of the Stichting Eleven Floawers
Foundation Board1, Secretary of the Stichting Ondersteuning Hervormd
Vreeswijk1, Secretary of the Stichting Vrienden Lelie Zorggroep1.
1 Non-remunerated.
Contents Abbreviations and definitions ABP Annual Report 2021 250
Abbreviations and definitions

Abbreviations
AAOP ABP ArbeidsOngeschiktheidsPensioen - ABP incapacity pension NP NabestaandenPensioen - dependents' benefits

ABTN Actuarial and Technical Business Report NPC New Pension Contract
AG Royal Dutch Actuarial Association NPS Net Promoter Score
AEP ABP ExtraPensioen OECD Organization for Economic Cooperation and Development
ALM Asset Liability Management OGM Omgekeerd-Gemengd bestuursModel – Reversed-mixed
AOP The AAOP, HPT, and IP disability/incapacity pensions governance model
AOW Algemene Ouderdomswet - General Old Age Pensions Act OP OuderdomsPensioen - Retirement benefit
APG APG and subsidiaries OPA Overgangsrecht Privatisering ABP – the ABP privatization
transitional rights
CBS Centraal Bureau voor de Statistiek - Statistics Netherlands
OTC Over-the-Counter Transaction
CEM Cost Effectiveness Measurement
PP PartnerPensioen - partner pension
CHRB Corporate Human Rights Benchmark
Repo Repurchase order
DNB De Nederlandsche Bank - Dutch Central Bank
SDG Sustainable Development Goal
ESG Environmental, Social, and Governance
SDI Sustainable Development Investments
FGR A collective Investment Scheme managed by the
administrative organization SFDR Sustainable Finance Disclosure Regulation
FPU Regeling Flexibel Pensioen en Uittreden - flexible and early-retirement SLA Service Level Agreement
benefits scheme TBA To Be Announced
FTK Financial Assessment Framework - Redeployment allowance UNGP United Nations Guiding Principles on Business and Human Rights
HPT HerPlaatsingsToelage – Redeployment allowance UPO Uniform PensioenOverzicht - Uniform Pension Statement
HRM Human Resource Management VPL Wet aanpassing fiscale behandeling VUT-prepensioen en introductie
KPI Key Performance Indicator levensloopregeling - Early Retirement/Pre-Pension (Adjustment of Tax
Treatment) and Life-Course Savings Scheme Act
IMVB Internationaal Maatschappelijk Verantwoord Beleggen - international
socially responsible investment VPV Voorziening PensioenVerplichtingen - Provision for pension liabilities
IP InvaliditeitsPensioen - disability pension VUT Regeling Vervroegd UitTreden
IPCC Intergovernmental Panel on Climate Change
Definitions Aggressive tax planning

Situations in which businesses make use of gaps between two different tax
ABP ExtraPensioen regimes to avoid levy of tax.
ABP pension product providing a supplementary pension – within the fiscal
scope for pension accrual – from tax-free savings by and at the risk of the Amortized cost
participant, with an investment guarantee and return based on ABP's return. Amount at which a financial asset or financial liability held to maturity is carried
in the balance sheet by taking account of the discount or premium.
ABP Net pension scheme
Voluntary pension scheme in which a pension can be accrued over the part Appendix K
of the pensionable salary in excess of the maximum salary for tax facilitated Appendix K sets out supplements and reductions in connection with the
pension accrual. The participant can opt to purchase retirement pension and privatization of Algemeen Burgerlĳk Pensioenfonds. This Appendix applies
surviving dependents’ pension with investment capital on retirement and/or to participants who accrued pension prior to January 1, 1996, and whose
take out insurance for surviving dependents’ pension in the event of death pensions or pension rights were converted in accordance with Section 18 of
before retirement. the scheme, as worded on December 31, 2005. With the exception of Article
9, this Appendix does not apply to persons designated Syria volunteers for the
Absolute return strategies purposes of the General Old Age Pensions Act or the Surviving Dependants Act.
Investment strategy with the goal of realizing a positive return irrespective of
the market situation. Asset
Category of investments.
Active participant
Employee who accrues pension rights with a pension administrator pursuant to Asset Backed Securities (ABS)
a pension contract. Securitized debt instruments issued by financial institutions in the form of
assets which have been converted into freely marketable bonds.
Active risk
Difference between the actual investment portfolio and the Asset Liability Management
benchmark portfolio. Analysis of the relationship between movements in assets and liabilities to
review contribution, indexation, and investment policy.
Administrative organization
APG, the organization contracted by ABP to perform the administration of the Available assets
pension scheme (pension administration, asset management, and support for Balance of total assets less investment-related liabilities, other liabilities, and
the Board of Trustees). specific reserves (forming part of the pension fund capital).
Basis point Cost-covering contribution

One-hundredth of a percent (0.01 percent). Actuarially calculated contribution required for the procurement of
vested liabilities, increased with mark-ups for pension management costs,
Benchmark maintaining the solvency requirement, and, when applicable, funding
Standard for comparisons of costs and performance of institutions in the conditional indexation.
same sector.
Counterparty risk
Benchmark portfolio Risk that a counterparty to a contract is unable to fulfill its liabilities
Pre-determined mix of an investment portfolio, including related benchmarks, toward ABP.
against which actual investment returns are compared.
Cross currency swap
Broker quotes Agreement to exchange interest payments in different currencies without
Values provided by a professional intermediary trading in the securities exchanging the principals.
concerned and based on available market information.
Current value
Capital Fair value as referred to in the Richtlijnen voor de Jaarverslaggeving (Annual
Remaining interest in the assets after deduction of the provision for pension Reporting Guidelines).
liabilities, investment-related liabilities, and other liabilities.
Derivatives
Commodities Financial instruments used to control the balance sheet and investment risks
Investments in goods and raw materials/consumables. and realize the strategic asset mix.
Compliance Discount rate

Acting in accordance with internal and external legislation/regulations and Interest rate used to calculate the net present value of expenditure or revenue.
ethics policy.
Duration
Conditional pension Weighted average maturity of an investment or liability, taking account of the
An increase of the ABP retirement pension and the ABP surviving dependents’ timing of cash flows.
pension, as compensation for the lapse of the FPU pre-pension scheme.
Exposure Future-proof indexation funding ratio

Current value of an asset or, in the case of derivatives, the value of the A policy funding ratio level that permits full future-proof indexation in line with
underlying asset. the inflation ambition such that indexation can be granted to the full amount of
realized inflation.
Investments with a fixed maturity and an agreed interest and repayment Global Reporting Initiative (GRI)
schedule, such as private loans, bonds, and mortgage loans. International organization that formulates guidelines for sustainability reports.
Organizations publish their economic, environmental, and social performance
Former participants in sustainability reports and integrated reports.
Employees or former employees who no longer accrue pension pursuant
to a pension agreement and who retained pension rights with a pension Group capital
administrator upon termination of their participation. Capital increased with third-party minority investments in the
participating interests.
Forward currency contract
A forward currency contract is a contract to buy or sell a given amount of a Hedge funds
currency at an agreed exchange rate on an agreed future date. The agreed Investment funds that pursue a predetermined strategy in an endeavor to
exchange rate comprises a rate at the time of conclusion, the spot rate, realize a positive return irrespective of the market return. These are often
and a mark-up. This mark-up is based on the interest spread between the private funds that operate with borrowed funds and use derivatives.
two currencies.
Indexation
Funding ratio Increase of pensions by a percentage fully or partially equal to price or
Degree to which pension liabilities are covered by the available assets. wage inflation.
Future Index bond

Forward contract traded on an exchange with the mandatory delivery of the Bond with coupon payment adjusted for inflation.
underlying securities at a future date for an agreed price.
Index-linked bond
Future-proof indexation Index bond that yields an interest rate that is in part based on inflation.
Granting indexation as a percentage of the ambition of realized inflation such
that it is expected that this same percentage of inflation can continue to be Inflation
granted as indexation in the future. Increase in an economy’s general level of prices.
Initial margin Mandatory reserve

Amount that must be held on opening a derivative position to serve Reserve that is not available for distribution.
as coverage.
Marketable securities
Integrated reporting Investments in equity, private equity, commodities, and real estate.
Reporting method that brings concise financial and non-financial information
together in one report, in which organizations explain how they realize Moderated cost-covering contribution
sustainable operations and how their strategy, governance, performance, Cost-covering contribution calculated based on an expected real
and prospects provide short, medium, and long-term added value, including investment return.
for society.
Mortgage-Backed Securities (MBS)
Integrity policy Securitized debt instruments issued by mortgage lenders in respect of granted
Policy designed to embed standards and values considered important by ABP mortgages that have been converted into freely marketable bonds.
in the organization.
Nominal
Interest rate forward Expression of monetary value or percent that does not take account of future
Money market derivative used to fix interest costs or interest yields by mutually wage or price inflation.
agreeing on a specific rate for a certain period.
Overlay
International Integrated Reporting Council (IIRC) Overarching management of positions across all portfolios (for example,
Global non-profit organization that has developed a standard for companies currency positions).
wishing to give account for the value they add to the world. This is a
reporting standard. Over-the-counter transaction (OTC)
Transaction not conducted on an exchange but arranged directly between
Intraday facility two parties.
Short-term assets settled within one day.
Participants
ISAE 3402 All active participants, former participants, and pensioners taken together as
International Standard for Assurance Engagements 3402. a group.
Pension beneficiary Related party

Person whose pension has become payable pursuant to a pension agreement. Natural person or entity related to the entity that draws up their/its
financial statements.
Policy funding ratio
The 12-month rolling average of the nominal funding ratios calculated using Repurchase order
the discount rates published by DNB. The policy funding ratio serves as the Contract for the exchange of securities at a pre-specified time, purchase, and
basis for Board of Trustees policy decisions such as setting contributions sale price, with the retention of economic risk.
and indexation.
Reversed-mixed governance model
Private equity The governance of ABP with effect from January 1, 2022, with a General Board,
Investment in the risk-bearing capital of an unlisted company. an Executive Board, and a Non-Executive Board.
Provision for pension liabilities Short position

Net present value of all expected future pension benefits arising from the Position created on entering into the obligation to deliver securities at a future
pension claims of all active participants, inactive participants, and retired date without ha
employees. Also referred to as the “technical provision” in a legal context.
Short-term borrowing/lending
Rating Funds borrowed from or loaned to a financial institution.
Score awarded to the creditworthiness of a counterparty resulting from a
credit assessment. Spread
Difference in return between two assets.
Real estate funds
Investment schemes in which the capital is invested in real estate. Sustainable and responsible investment
An investment approach that fully integrates sustainability aspects and
Real funding ratio responsible investment criteria in investment decisions.
Expression of the relationship between a pension fund's assets and
pension liabilities in which expected price increases are included in the Swap
pension liabilities. Derivative whereby parties exchange cash flows or risks.
Real return TBA

Nominal return adjusted for price inflation. To Be Announced – a forward on a mortgage-backed security (MBS).
Tracking error
Difference in returns between a portfolio and the benchmark.
Uniform Pension Statement

Format for the presentation of information on retirement, death, and invalidity
pensions used by all pension funds.
Z score
Measure of the difference between the actual return and the return on the
pre-specified benchmark portfolio, taking account of expenses.
Publisher’s imprint
Text and editing

ABP
Stichting Pensioenfonds ABP APG
PO Box 4806 Van Enk Communicatie – Leiden
6401 JL Heerlen
The Netherlands Translation
www.abp.nl Metamorfose Vertalingen BV - Utrecht
© 2022 | Pensioenfonds ABP
Creative concept and design
Questions and comments CF Report – Amsterdam
If you have any questions or comments This Annual Report was prepared in Tangelo
about our Annual Report, you are
welcome Advice and project support
to contact us at jaarverslag@abp.nl. Report Company – Soest

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Annual

Peace of mind 30 Personal motivation 35

Freedom 50 Attractive employment benefit 78

ABP at a glance 4 Financial statements 127

We are the pension experts for our participants,

Key figures 2021

Performance in 2021 and goals for 2025

Sustainable and responsible investment

1,203,358 12,720 110.6% Invested in SDG 7

940,146 12,908 102.8%

Pensioners Provision for pension Discount rate NPS

498,797 -23 +22

3,468 551,644 11.4%

Policy funding ratio (in %) 102.8 87.6 95.8 103.8 101.5

2021 2020 2019 2018 2017

Price indexation (in %)1 2.39 0.71 2.84 2.08 1.38

Net Promotor Score pension (NPS)5

Z score -0.1 1.1 -1 0.7 0.9

Return total (= direct + indirect, in %) 11.4 6.6 16.8 -2.3 7.6

How ABP adds value

How ABP adds value – Overview

Financial Cost-conscious administration Livable world Sustainable and

How ABP adds value

Pension value for all participants Confidence in their pension

Average increase in value Number of participants

Annual return 11.4%

Report of the Board of Trustees

In 2021, the government continued work on the introduction of the new

In a world characterized by profound unrest and uncertainty, we will gear

ABP’s approach to this is described in the following section: Equilibrium

The value of pensions

“In 2013, we launched campaigns in the Netherlands that focused

How we build a good

ABP’s strategy B. Appealing fringe benefit;

Building a good pension together – participants and employers prefer ABP

Good Appealing Good pension

7 We have a professional 8 We have a grip on activities 9 Our internal operations

Progress Focus for 2022

Who are our stakeholders?

Primary ABP target groups Internal stakeholders Regulators

• Active participants, former participants, and • Accountability Body • De Nederlandsche Bank

• Pension Board Including: • Political centers in The Hague

ABP’s materiality matrix

ABP's interest according to external stakeholders

ABP's interest according to internal stakeholders

Sustainable and responsible investment

Sound management of pension assets

Equilibrium between contribution, certainty, and ambition

The value of pensions

“Nibud provides information and advice on managing money now

choices for can be tricky. A lot comes down to personal circumstances –

Funding ratio as at year-end 110.6 93.5

Minimum capital requirement (+100)

Policy funding ratio

The value of pensions

“Government bonds, the investment category I am responsible

‘We know at the center of our ever-evolving economy. Unlike commercial

Sustainable and responsible investments 2021

Inclusion and exclusion CO2 footprint of equities portfolio