Norway's sovereign fund divests further from fossil fuels

Norway’s sovereign wealth fund, the biggest in the world, has sold out of 73 companies in the past year because their social or environmental policies could hurt profitability. The companies have not been named, but it appears that most were coal or energy companies using coal, as well as those involved in mining, producing cement and heavy construction. Experts believe this could trigger a wave of similar divestment. The fund is currently worth around $794bn (£545bn). Over the past four years it has divested from 187 companies including Boeing, Lockheed Martin, Rio Tinto, Philip Morris and British American Tobacco. The fund invests in a over 9,000 companies and is considered a trailblazer in applying ethical considerations to investments.

Norway’s huge sovereign wealth fund, the world’s biggest, has sold out of 73 companies in the past year because their social or environmental policies could hurt profitability.



The Norwegian state pension fund’s annual report relating to “responsible investment” did not give the names of companies, but it indicated that most were coal or energy companies using coal, as well as those involved in mining, producing cement and heavy construction.

“We want to measure the risk in our investments,” said the head of the fund, Yngve Slyngstad, in a statement on Thursday.

“We expect companies to communicate the impact of their activities on the environment and the factors that could affect their long-term profitability,” he said.

The fund is currently worth around $794bn (£545bn), equivalent to around six annual budgets or more than $153,000 for each of the country’s 5.2 million inhabitants.

Fuelled from Norway’s huge oil and gas revenues, the fund is intended to pay for future generations in the welfare-state after the country’s wells run dry.

Over the past four years it has divested from 187 companies. Those decisions were made for financial reasons, which increasingly take into account social and environmental activities by the company and their impact on profit.

The fund can also exclude companies for purely ethical reasons when they are seen to be in serious violation of human rights, or are producers of nuclear weapons or tobacco.

Among those excluded have been some of the world’s biggest corporations such as Boeing, Lockheed Martin, Rio Tinto, Philip Morris and British American Tobacco.

The fund invests in a total of more than 9,000 companies and is considered a trailblazer in applying ethical considerations to investments.