Ilmarinen, ICG Engage With Scandal-hit Finnish Care Home

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Finnish pension insurer Ilmarinen and asset manager Intermediate Capital Group (ICG) are engaging with a Finnish care home company following reports of severe neglect.

UK-based ICG and Ilmarinen – one of Finland’s largest pension insurance companies – have said they will engage with the management of Esperi Care rather than divest, after reports emerged of severe neglect at care homes.

Finland’s healthcare regulator shut down one facility after at least one elderly resident was suspected to have died due to negligence, according to national broadcaster YLE.

ICG holds the majority stake in Esperi Care, while Ilmarinen owns a 4.4% stake according to Finnish newspaper Helsingin Sanomat, having inherited the asset through its merger with Etera a year ago.

A spokesperson for ICG in London said: “We are focused on working to support the management of Esperi Care as it undertakes a full review of its operations and makes the improvements necessary to regain the trust of its residents, relatives and employees.

“We take a long-term approach to investing in companies and, as signatory of the UN Principles for Responsible Investment since 2013, have a well-defined ESG framework in place with clear policies and practices. These are key considerations in our investment approach.”

Ilmarinen: engagement over divestment

Ilmarinen’s CIO Mikko Mursula told Helsingin Sanomat that the insurer would attempt to find out more about the case before any decision on divestment.

“The principle of responsible investment is based on the fact that the investment object complies with laws and norms,” Mursula said.

Ilmarinen staff were asking the company about the background and the company’s understanding of the chain of events, he said.

Anna Hyrske, head of responsible investments at Ilmarinen, told IPE that the company’s responsible investment policies gave preference to engagement over divestment.

Helsingin Sanomat reported that disagreements between Esperi Care and Finland’s national health and welfare regulator, Valvira, about the adequacy of nursing staff had been in the public domain for more than two years. Mursula told the paper he had no information on the matter, however.

Links between Esperi and Etera

Esperi Care’s CEO Marja Aarnio-Isohanni resigned on Tuesday as a result of the outcry, and was replaced by Heini Pirttijärvi.

Aarnio-Isohanni is currently a deputy member of Ilmarinen’s supervisory board, having been appointed to the role a year ago. She spent more than 10 years on Etera’s board, according to her LinkedIn page.

She had worked at Esperi Care since 2003 and owned 10.5% of the business – a stake she has retained, according to Finnish national broadcaster YLE.

Aarnio-Isohanni was Finland’s second wealthiest woman in 2017, earning more than €5.7m that year, according to YLE.

Valvira announced at the end of last week that it had shut down one of the company’s homes located in Kristiinankaupunki in the west of Finland, having received “serious, direct customer safety” information.

“The weaknesses identified were related, inter alia, to the number of inadequate medical staff in relation to the assessment of care and care needs, lack of basic care, the appropriateness of drug treatment, lack of care information for clients, and the work of close staff of the functional unit,” Valvira said in a statement.