(March 14, 2014) — The largest pool of capital funded by fossil fuel revenues is to increase its investment in renewable energy, its national government has said.
Norway’s Government Pension Fund-Global is to “expand its mandate” and allocate more of its $840 billion in assets to energy sources that do not use exhaustible natural resources, the Wall Street Journal reported.
The country’s Prime Minister, Erna Solberg, told a press conference in Oslo yesterday that the move would be an effort to more acutely combat global warming. No definite figure or percentage of the $840 billion that would be dedicated to the move was mentioned, however, and more information is to be announced next month.
The fund is the largest investor in equities in the world and also holds almost 10% of its assets in fossil fuels. It has come under increasing pressure from politicians and other observer groups to diversify and even to break into smaller, more nimble capital pools.
In November, the fund was told by its strategic advisors to improve its responsible investment capability to benefit companies and its own financial returns
The fund, which has a history of transparency and ethically-focused investing, was told by its Strategy Council that it believed the fund could “achieve more powerful effects from its responsible investing practices by integrating exclusion decisions with its ownership strategies”.
The fund has since pulled out of investing in mining firm Vedanta after its ethics council said the company’s “relevant operations in India, which are run through the company Sesa Sterlite, present an unacceptable risk of environmental damage and serious violations of human rights”.
The fund has also been moving into more illiquid assets, including large swathes of prime real estate in London and Paris, and has also ventured into the US residential and commercial property markets.
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