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Norway: Government pension fund divests from companies linked to deforestation

"Norway divests from plantation companies linked to deforestation," 01 March 2019

...Norway released the 2018 investment holdings of its massive government pension fund. Notably absent were four plantation companies previously listed in the portfolio: Olam International, Halcyon Agri Corp, Sime Darby Plantation and Sipef.

Olam International and Halcyon Agri Corp are both Singapore-based agribusiness companies, with Olam linked to deforestation for oil palm plantations in Gabon and cocoa in Ghana and the Ivory Coast, and Halcyon Agri’s subsidiary Sudcam razing rainforest for a vast rubber plantation near a UNESCO site in Cameroon. Belgium-based Sipef runs oil palm, rubber, banana and tea plantations in Indonesia, Papua New Guinea and the Solomon Islands, while Sime Darby Plantations produces palm oil in several countries in Southeast Asia, West Africa and Oceania.

With around $1 trillion in assets, Norway’s Government Pension Fund Global (GPFG) is the world’s largest sovereign wealth fund...

However, it doesn’t invest in just any company – certain ethical guidelines must be met. Coal mining, human rights violations, production of nuclear weapons, and “severe environmental damage” are a few criteria that prohibit the fund from investing in a company.

“The Ministry of Finance has established ethically motivated guidelines for observation and exclusion of companies from the fund,” said Marthe Skaar of Norges Bank Investment Management, which manages the fund. “The guidelines contain criteria for exclusion based either on the companies’ products or on their conduct.

While Olam, Sime Darby Plantations, Halcyon Agri, and Sipef aren’t included by name in the GPFG 2018 Responsible Investment report (“We do not disclose the names of our risk-based divestments,” Skaar told Mongabay), the report states 30 companies were divested from following “assessments of governance and sustainability risks.” These four companies are also no longer included in the GPFG 2018 holdings report while they were included in it in 2017.