Norway Fund Told Not to Invest in Private Equity

Norway’s $1 trillion sovereign wealth fund, the world’s largest, should not be given permission to invest in unlisted companies, the finance ministry said in recommendations to parliament on Tuesday, rejecting the fund’s own advice, Reuters reported. The fund invests Norway’s oil and gas revenues into stocks, bonds and property abroad, and is one of the world’s biggest shareholders with stakes totaling 1.4% of all listed companies. “Unlisted equity investments would challenge the management model based on transparency, low management costs, and a limited degree of active management,” the finance ministry wrote in its annual white paper on the fund to parliament. The fund has argued that investing in unlisted shares, primarily via private equity, could help improve its balance between risk and return, naming Uber and Airbnb Inc among missed opportunities due to the current restrictions. “We are concerned about the reputation of the fund. Openness is very important for the fund’s legitimacy, its trust,” Finance Minister Siv Jensen told reporters.