Norway’s $1 trillion wealth fund is excluding some of the world’s biggest commodities firms from its portfolio, including Glencore and Anglo American, because of their use and production of coal. Underlining the growing role of climate considerations for long-term investors, the fund is also excluding German utility RWE, South African petrochemicals firm Sasol and Dutch company AGL Energy over their use of coal.
Norway’s parliament agreed in June 2019 that the world’s largest fund would no longer invest in companies that mined more than 20 million tonnes of coal a year or generated more than 10 gigawatts (GW) of power from coal. Wednesday’s announcement, made in a statement issued by the fund, is the first to reveal the measure had been applied. The fund always sells holdings before any exclusions are announced to avoid excessive market movements.
Another set of companies – BHP, Uniper, and Vistra Energy – were put under observation for possible exclusion later if they did not address their use or production of coal, the fund said.
The fund, set up in 1996 to save for future generations Norway’s revenues that it earns from producing oil and gas, is among the world’s largest investors, owning around 1.5% of all globally listed shares. It operates under ethical guidelines set by parliament and excludes companies from its portfolio that do not respect them. Its exclusions are often followed by other funds.
The fund also said it was excluding four Canadian oil firms for producing excessive greenhouse gas emissions, the first time it has used that reason to blacklist firms from its portfolio. Canadian Natural Resources, Cenovus Energy, Suncor Energy and Imperial Oil were excluded for “unacceptable greenhouse gas emissions,” it said.
[Ismail Shakil, Terje Solsvik, Gwladys Fouche]