Norway’s Pension Fund Divests from 23 Palm Oil Companies

deforestationNorway’s Pension Fund divested from 23 palm oil companies in 2012. 

The Norwegian Government Pension Fund Global (GPFG) is the world’s largest sovereign wealth fund valued at about USD 667 billion. It has for long been under pressure by NGOs concerned about its investments in the palm oil sector and other sectors responsible for deforestation and environmental impacts.

Despite having one of the world’s strongest ethical guideline for its investments, it was only last year it incorporated deforestation. Fortunately it did not take long for it to take action. In its annual report explains the divestment decision.

23 companies
– In the first quarter of 2012 we sold our stakes in 23 companies that by our reckoning produced palm oil unsustainably, says GPFG.

The Fund explains before it reached this decision, it reviewed a number of companies contributing to tropical deforestation through their involvement in the palm oil industry in Malaysia and Indonesia.

– We contacted several of the companies to obtain information on how they managed deforestation and we placed weight on whether the companies had committed to the Roundtable on Sustainable Palm Oil, which provides an international certification scheme for sustainable palm oil production, says GPFG.

Major step forward
The Norwegian Pension Fund has received a lot of criticism for investing in companies contributing to deforestation. Particularly since the Norwegian Government spends billions of dollars to protect rainforest.

Last year, Rainforest Foundation Norway and and Friends of the Earth Norway published a report about Norway’s investments in environmentally damaging companies. Naturally it welcomes the divestment.

– This is a major step forward and a victory for the remaining rainforests. One of the world’s biggest investors sends a clear signal to the oil palm industry that its destructive practices are unacceptable, says Nils Hermann Ranum.

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