Norway sovereign wealth fund ethical framework overhaul

Norway is preparing to overhaul the ethical framework governing its Government Pension Fund Global following a period of restricted divestment capabilities. A parliamentary decision last November stripped the fund’s Ethics Council of its power to recommend the exclusion of specific companies, placing such actions on hold pending a formal review.

The suspension of ethics-based divestments followed protests from the Trump administration regarding the fund’s previous decision to divest from Caterpillar shares due to the use of its equipment in Gaza and the occupied West Bank. While the Norwegian government denied the pause was intended to avoid upsetting the United States, the parliament voted to halt recommendations during the review process.

During this period, recommendations from the Council on Ethics were redirected to Norges Bank Investment Management rather than the central bank’s board, resulting in no divestments being executed. This lack of transparency has drawn criticism from Amnesty International. The Gjedrem committee is now set to propose a new framework to address these issues, with Finance Minister Jens Stoltenberg noting the difficulty of distinguishing between civil and military products in modern global value chains.