World’s Biggest Wealth Fund Wants Oil Firms to Cut More Emissions

World’s Biggest Wealth Fund Wants Oil Firms to Cut More Emissions
World’s Biggest Wealth Fund Wants Oil Firms to Cut More Emissions

The world’s largest sovereign wealth fund, Norway’s $1.4 trillion Government Pension Fund Global, should ask the companies it is invested in when it comes to reaching their 2050 net-zero emissions goals, a government panel said.
The fund said that oil firms in its portfolio need to cut their emissions more drastically, Oil Price reported.
Norway is one of Europe’s richest countries thanks to the decades of oil revenues amassed in the world’s largest sovereign wealth fund with $1.4 trillion in assets and holdings of 1.4% of all of the world’s listed companies, including stakes in oil majors Exxon, Chevron, Shell and BP.  
This week, a report from an expert group appointed by Norway’s Ministry of Finance recommended that the work on climate risk be anchored in the fund’s mandate, under which Norges Bank’s “responsible investment is based on an overall long-term goal of zero emissions from the companies in which the fund has invested, in line with the Paris Agreement”.
Oil firms in the fund’s portfolio “absolutely” aren’t doing enough for emission reduction, Carine Smith Ihenacho, chief governance officer at the fund, said.
“These are companies we monitor very, very closely with a view to the climate and emissions,” she added.
The fund put the oil sector on notice as early as November 2017 when it said that it recommended the removal of oil and gas stocks — around $35 billion worth of shares at the time — from the fund’s equity benchmark index to make Norway’s wealth and economy less vulnerable to a permanent drop in oil and gas prices. 
Two years later, the fund’s proposal for dumping oil stocks was narrowed down to stakes in purely exploration and production companies worth a total of less than $6 billion.
As net-zero emissions get increased attention, the fund now uses its ownership stakes to demand companies set net-zero targets.

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