March 9, 2017 Read More →

Norway’s Pension Fund Considers Divesting From Firms Facing Climate Risk

Reuters:

The ethics watchdog for Norway’s $900-billion sovereign wealth fund will recommend this year that the fund exclude or put on a watch list several firms in the oil, cement and steel industries for emitting too much greenhouse gas.

Carbon emissions are a new criteria for the fund, which was built up from the proceeds of Norway’s own large oil industry and operates under ethical guidelines set by parliament.

The world’s largest sovereign wealth fund, it has shares in 9,000 companies, 1.3 percent of the entire world’s listed equity, giving the decisions it takes to drop or reinstate shareholdings or warn firms considerable weight among investors.

The chairman of the fund’s independent Council on Ethics, Johan H. Andresen, acknowledged in an interview what he called the “duality” of a fund based on oil divesting over emissions, but said his job was to execute rather than set a mandate.

The fund may also exclude several firms in the defense, telecoms and arms industries this year over the risk of corruption, he said.

The council’s recommendations go to the board of the central bank, which usually follows its advice.

Speaking in an interview ahead of publication of the council’s annual report on Thursday, Andresen said it was already working on the first recommendation over emissions, expected to come by July.

“It will be a company either in the oil or concrete industry … We have to start with the worst and make our way through the industries,” he said, adding that there would be a “small handful” of recommendations to the board in 2017.

Norway’s wealth fund may blacklist firms over emissions, corruption risk

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