Altogether 88% of Swedes manage almost 2.4% of the yearly amount needed by the European Comissons to obtain a green transition within the Swedish system for occupational pensions. Despite the importance of these investments for retirees’ livelihoods, individuals have limited choice and must invest in funds approved within their collective agreements. Recently, most available mutual funds have shifted towards sustainable options classified as Article 8 or Article 9 under the EU’s Sustainable Finance Disclosure Regulation (SFDR).

This thesis investigates whether systematic financial performance differences exist between Article 8 and Article 9 funds in Sweden during the period 1 January 2020 – 31 December 2024. Using quantitative methods, it compares risk-adjusted returns of these funds against each other and the MSCI World Index benchmark.

The results reveal no statistically significant performance differences between SFDR-classified funds and the benchmark. This contrasts with earlier studies that linked higher ESG scores to better returns but supports recent critiques questioning the meaningfulness of SFDR classifications in reflecting financial or sustainability differences.

These findings have crucial implications for Swedish investors, especially pension savers. If SFDR labels don’t reliably predict superior returns, pensioners risk lower gains and greater market volatility under the false assumption of better sustainable investment performance.