NORWAY - The US$329bn Government Pension Fund - Global has unveiled sweeping changes to its ethical investment policy, and will make more than US$3bn available for environmental investments.
Norwegian minister of finance Kristin Halvorsen said: "It has been a demanding process, with high expectations, and we have received much good input. We have tried to create a cohesive whole that helps further clarify the Fund's role as a responsible investor.
"We take climate change seriously. We also want to strengthen the focus on issues related to climate change in Norges Bank's work on engaging with companies. These measures we are proposing will ensure that the Government Pension Fund - Global will be among the leading funds internationally in this area."
Key to the reforms are a greater emphasis on corporate governance, active ownership and exclusion policies and the creation of a corporate 'watch list' for companies in the 'grey area' close to exclusion.
Halvorsen said the fund would also invest NOK20bn (US$3.03bn) over five years in projects expected to generate "indisputable environmental benefits", including clean energy, energy efficiency, carbon capture and storage and waste management.
The Ministry of Finance will sign up to the UN Principles for responsible Investment (UNPRI) and participate in other international initiatives to further this agenda.
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Malcolm Mclean says getting the channels of communication right and engaging more openly is a good starting point