World’s Biggest Wealth Fund Excludes 52 Coal-Related Groups

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Norway’s central bank recently announced that Norway’s Sovereign Wealth Fund, the world’s biggest, has excluded 52 coal-related companies in line with new ethical guidelines barring it from investing in such groups in its fight for climate change.

The fund, fuelled by Norway’s state oil revenues and currently worth around 7.11tn trillion kroner (£610bn, $864bn), has divested its shares in 52 companies, most of them US and Chinese, including China Coal Energy, AES, and Peabody Energy, the biggest US coal producer which filed for bankruptcy on Wednesday.

The list also includes several Indian companies, such as Reliance Power and Tata Power, three Japanese groups and several European companies.

Prior to this, in June 2015, the Scandinavian country’s parliament agreed to pull the fund out of mining or energy groups which derive more than 30% of their sales or activities from the coal business and was put to effect February 1, 2016.

The fund’s investment policy is run according to strict ethical rules, with a focus on sustainable economic, environmental and social development and those rules restrict its investment in companies accused of serious violations of human rights, child labour or serious environmental damage, as well as manufacturers of “particularly inhumane” arms, and also tobacco firms.

By divesting from energy companies that derive more than 30% of revenues from coal, the move was seen as a sign of the growing influence investors wield in the fight against climate change.

 

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