Norway’s enormous pension fund that’s fueled by oil revenues has long tried to invest its money in accordance with ethical standards. On Tuesday that led to an announcement that the so-called “oil fund” has sold off its stakes in 17 international companies that produce tobacco.
Finance Minister Sigbjørn Johnsen, who has ultimate authority over the fund that’s tied to Norway’s Central Bank, said the exclusion of the 17 companies was based on a recommendation from the ethics council that continually reviews the so-called oil fund’s investments.
Johnsen said the decision was also in line with a general tightening of anti-smoking laws within Norway and with the policies of the UN’s World Health Organisation.
“It’s important that the ethical guidelines (of the fund) reflect at all times what can be considered to be commonly held values of the owners of the fund,” Johnsen said, referring to the Norwegian government and its citizens.
The ethics council for the fund, formally known as Statens pensjonsfond utland (Government Pension Fund Global), identified the excluded companies based on their own descriptions of their tobacco operations. They include such firms as British American Tobacco, Philip Morris, Lorillard, Reynolds American Inc and Swedish Match.
Also on the exclusion list are Alliance One International, Altria Group Inc, Gudang Garam, Imperial Tobacco Group, ITC Ltd, Japan Tobacco Inc, KT&G Corp, Souza Cruz SA, Universal Corp VA and Vector Group Ltd.
Stock holdings in any of these companies already have been divested, according to the Finance Ministry, and no further investments will be made.
The council said it may propose additional companies for exclusion, based on tobacco operations.
Norway’s oil fund earlier has caught international attention for its decisions to dump stock in other major companies, including US retailing firm Wal-Mart, because of alleged labour, human rights or other abuses. Fund managers also have been accused of hypocrisy, however, because they’ve continued to invest in several large defense contractors and other firms that seemingly defy ethical standards.