SWF Radar GovernmentPensionFundGlobal

Thomson Reuters reports that, “Norway should earmark some of its $295 billion oil fund [the Government Pension Fund–Global] for long-term investments in environmental stocks, Environment Minister Erik Solheim said on Thursday.”

The Business Standard writes that, “Even as foreign institutional investors rapidly pull out their money from Dalal Street, Norway's sovereign wealth fund [the Government Pension Fund–Global], the world's second largest, is set to invest $2 billion in Indian stocks.”

IceNews reports that, “Economists suggest that [Norway’s] sovereign wealth fund [the Government Pension Fund–Global] would have more money in it today had the government simply placed the cash in the bank.”

Thomson Reuters reports that, “Norway’s sovereign wealth fund [the Government Pension Fund–Global] is sticking to its previous estimate for its year-end value, despite losses on the back of global financial turmoil, daily Aftenposten reported on Thursday.”

The New York Times has published an interview with Yngve Slyngstad, chief executive of Norway’s Government Pension Fund–Global.

The Financial Times writes (reporting the findings of a report for Noway’s SWF by the SRI-consultancy Innovest) that, “Sovereign wealth funds lag significantly behind the leaders in the field of socially responsible investing, missing a chance to enhance returns as well as help mitigate climate change.”

I don’t understand why SRI is so often accepted as being something that will increase returns. Are fund managers actively screening-out ethically sound investment opportunities? Are they actively screening-in financially unsound yet immoral ones?

The article adds (paraphrasing the report) that, “Since the Norwegian government has announced its intentions to set an example in international climate change efforts, this would be in line with government policy.”

Climate change isn’t the kind of hot-button political issue that helped drive anti-SWF sentiment earlier this year. But it does seem strange that the report’s authors could have thought, given the furore, that aligning its investment policies with its respective government’s political policies is something that should be welcomed in an SWF.

Thomson Reuters reports that, “Norway’s $375 billion sovereign wealth fund said on Monday that it had been prepared for the bankruptcy filing by U.S. bank Lehman Brothers, in which it held more than $840 million worth of stocks and bonds at the end of 2007.”

Carl Mortishead of The Times writes of the decision of Norway’s Government Pension Fund-Global to divest in Rio on environmental grounds that, “This is Norwegian government policy at work and it has the backing of a fund that is worth some $375-billion (U.S.). It is the most striking example of a sovereign wealth fund used to implement social and political policy at the corporate level with a detailed ethical investment policy.”

I wonder how the IMF’s GAPP code for SWFs will deal with SRI.

Brad Setser has written a post on Chinalco’s recent acquisition of a large stake in Rio Tinto. He quotes Richard McGregor of the FT as writing that, “In short, you do not have to be a rabid conspiracy theorist to conclude that Chinalco is a front for China Inc.”

Setser adds that, “Maybe Norway's government fund [which decided in the last few days for reasons of SRI to sell its stake in Rio] should offer China its mining portfolio in one big block trade?”

Thomson Reuters reports that, “Norway on Tuesday excluded iron ore miner Rio Tinto from its $375 billion (212.5 billion pounds) sovereign wealth fund [the Government Pension Fund-Global] due to environmental concerns over its activities, as part of its drive for ethical investment.”