Interesting reading - most funds are not exactly known for their tranparency...
OSLO, Jul 31 (IPS) - Norway’s ‘oil fund’ has risen to become the second largest fund in the world despite housing an ethical investments council which has kicked out major companies such as Wal-Mart, Lockheed Martin and Boeing.
The ‘oil fund’, properly called the Government Pension Fund - Global, and worth an estimated 390 billion dollars, has become the world’s second largest sovereign wealth fund, now only trailing the Abu Dhabi Investment Authority after overtaking the Dutch fund for public employees.
The fund invests some of the huge profits from Norway’s oil and gas sector in companies worldwide to raise money in anticipation of increased pension costs and a future without oil exports.
Business is booming, perhaps partly explaining why the ethics councils of 20 non-Norwegian funds are said to be copying its ethical guidelines and recommendations, and in the process broadening its impact considerably, according to Norway’s finance ministry.
The unprecedented level of investment transparency practised by the oil fund may be another contributor to its success. The fund has been clear that its goals relate to financial sustainability as opposed to any secretive political agendas, and it scored no less than 100 percent for governance, accountability and transparency in a 2007 study by the U.S.-based Peterson Institute for International Economics (Abu Dhabi Investment Authority scored 2 percent).
The fund invests earnings from Norway’s oil and gas sector in companies outside of Norway in accordance with guidelines from the finance ministry. Some of these guidelines relate to ethics and are meant to ensure that the fund does not invest in companies that contribute to any of a series of specified abuses that finance minister Kristin Halvorsen has summarised as ’serious, systematic or gross violations of ethical norms.’
A total of 27 companies have been kicked out of the fund following the creation of the ethics council in 2004. Most of these were excluded for producing weapons that ‘may violate fundamental humanitarian principles.’ Among these were Lockheed Martin or EADS for producing components for cluster bombs, and Boeing for producing central components for nuclear weapons.
Wal-Mart got the boot for workers right abuses (including child labour, gender discrimination, and the blocking of unionisation attempts). The oil fund has also pulled out of companies that have engaged in abuses such as the forced displacement of tribal peoples or serious environmental destruction.
[From Norway’s Oil Fund Eclipses Alberta « STOP: Stop Tar Sands Operations Permanently]
Technorati Tags: 
Post new comment