Vikings Are Coming (Again)! Scandinavian Investor Focus on Sustainability and ESG; Norway’s Sovereign Fund Sets the Pace

BY: NORWAY’S SOVEREIGN FUND

(New York, NY, December 17, 2009) – The Vikings are coming, brandishing their Sustainability broadswords! Never to be trifled with in the dawn of the first millennium, the Scandinavians are at it again, only this time from an activist investment focus.

In a posting posted this week on the Governance & Accountability Institute public platform -- www.Accountability-Central.com – the Institute’s newsletter, “Sovereign Wealth Fund (SWF) Perspectives & Insights” reports that more intense investor focus on the impacts of climate change, global warming and good governance and excellence in corporate citizenship may be found among asset owners and managers based in the Scandinavian region. This region is documented by Environmental Research Letters as countries that are experiencing very rapid and significant changes associated with global warming. For them, it’s personal as well as global.

The Governance & Accountability Institute has been tracking sovereign wealth funds of the world. Unparalleled information on the SWFs can be found on the Institute’s proprietary INSIGHTS-edge resource http://www.gai-insightsedge.com (please contact the Institute for guest user name/password).

Notes Henry (Hank) Boerner, Chairman of the Governance & Accountability Institute:

“The regional pace is often set by Norway’s Sovereign Fund (the Norwegian Government Pension Fund Global for foreign investment – total of Fund AUM USD$350 billion+), which is managed by Norges Bank. The Government of Norway’s Finance Ministry maintains ethical and SRI guidelines. Equities are excluded from portfolio for such things as violations of human rights, manufacture of weapons and poor environmental performance. Climate change concerns are paramount for these investor interests, whose investment pool is constantly filled with revenues from North Sea oil and gas sales. (Norway’s fund is second largest SWF in the world and largest in Europe.) Note that other SWFs actively mention Norway’s SWF as their example [for their own country’s] SWF adoption of Sustainability guidelines or positions on ESG issues.”

Boerner adds: “Next door in Sweden, pension funds and asset managers are among organizations signing on to the Sustainable Value Creation Initiative (SVCs), intended to encourage corporate issuers listed on exchanges to adopt “good governance” positions on Sustainability issues. (The SVC was created in Norway in 2008; there are 10 institutional members in that country.)

The Swedish adopters of the Initiative are: Forsta AP-fonden; Andra AP-fonden; Tredje AP-fonden; Fjarde AP-fonden; DnB; NOR Asset Management; Nordea; S/E/B; Skandia; SPP; Swedbank; Svenska Kyrkan (the Church of Sweden); Meta Asset Management; and Folksam.

Boerner states that Folksam is Sweden’s largest insurance company, which is involved in the Nordic Engagement Cooperation (Finland, Norway and Sweden’s pension funds) with Ilmarinen and KLP. Portfolio screening is by researchers GES Investment Services which has offices in Stockholm and Copenhagen and provides ESG research and analysis for investor clients. The organization is focused on Northern European and Nordic region clients.

“Keep in mind that Norway’s SWF recently committed Euro 500 million in green investments, targeted for listed equities and bonds in ‘green’ (environmental) companies in the coming year (2010). This is a five-year investment program at the direction of Norway’s Finance Ministry. (Bonds could include those issued by the World Bank and other institutions.) Total investments could reach NOK 20 billion (USD$3.3 billion) over a 5-year period for two programs – listed environmental equities and investment in emerging countries / with environmental focus,” Boerner reports.

For further information on Scandinavian sovereign wealth funds and related institutions, please contact the Governance & Accountability Institute at its New York headquarters (646) 454-0577 or at its Long Island Technology Center at (516) 248-2383.

INSIGHTS-edge information on the sovereign wealth funds may be accessed by subscribers. If you would like a guest login, please contact Peter M. Hamilton at Boerner Communications, 516.741.8244 and phamilton@boernercommunications.com.

Environmental Research Letters on High Latitude global warming can be sourced at: http://www.iop.org/EJ/abstract/1748-9326/2/4/045008