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Norwegian fund becomes more engaging

2010

The Norwegian government has moved from negative screening of the investments in its Global Pension Fund to an engagement approach.

The €316bn Oil Fund will now lobby companies in which it invests rather than necessarily excluding them over social and environmental issues. Until now it has largely relied on a policy of exclusions, most recently leading to divestment from tobacco companies and the mining business Vedanta Resources.

The Fund says it will now seek to address CSR issues with ‘alternative measures’ such as observation and ‘active ownership’ before any blacklisting. ‘The new guidelines enable a slightly broader assessment of the situation before a company is excluded on grounds of grossly unethical behaviour,’ it said.

The new stance brings the fund more into line with the approach taken by responsible investors in much of Europe. Norwegian finance minister, Sigbjorn Johnsen, who helped draw up the new guidelines, said: ‘In some cases, it is more useful to put a company under observation than to exclude; for example, if there is uncertainty about how the situation will develop. We monitor the companies that have been placed on this watch-list closely to see if they implement measures to remedy the situation before we make a final decision on whether to exclude the company or not.’

The new guidelines replace those of 2004, which have led to the removal of WalMart, RioTinto and Freeport McMoRan among others since their implementation. 



Further Information
http://ethicalp.com/norway_guide
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