OSLO, Norway – What do Wal-Mart Stores Inc., Boeing Co., Honeywell International Inc. and Lockheed Martin Corp. share along with being U.S.-based?
They’re all corporations that have been put on a blacklist by a Norwegian state investment fund that aims to make the nation’s huge oil wealth grow for the benefit of its citizens while making the world a better place. Boeing and other military contractors were banned for involvement in weapons production; Wal-Mart was shunned for its opposition to unions.
The $263 billion global fund is under strict government-imposed ethical guidelines to ensure that money doesn’t go to companies linked to such things as weapons production, human rights abuses, environmental damage or corruption.
“The main reason is not to contribute to unethical investments so the Norwegian people can sleep better at night,” said Gro Nystuen, leader of a national Council of Ethics that oversees the fund’s investments in up to 4,000 companies worldwide.
Offshore fields have made NATO-member Norway the world’s third largest oil exporter after Saudi Arabia and Russia. As home to the Nobel Peace Prize, it also seeks to be a global do-gooder – mediating some of the world’s worst conflicts and donating more foreign aid per capita than any other nation.
The Nordic nation of 4.6 million people has been plowing its oil windfall into the fund, formally called Norwegian Pension Fund – Global, which will provide for the retirement of millions of Norwegians once the country’s oil resources dry up. There is no set year for when to start using the fund, or the amount to shell out to each retiree – the economy will decide.
The Central Bank-operated fund is worth nearly 2.5 times the entire central government budget for 2007 of this welfare state. The government transferred $34 billion to it in 2005.
The fund was set up by Parliament in 1990, but the first deposits weren’t made until 1996. Other countries have ethical guidelines for government funds, but Nystuen said he knew of no other that operated under such strict rules.
The government imposed the guidelines in 2004; since then, 18 companies – 12 of them U.S.-based – have been excluded. One of them, oil and gas producer Kerr-McGee Corp., was reinstated this year.
Blacklistings can draw angry responses. After Wal-Mart – the world’s largest retailer – was barred this year, the U.S. Ambassador to Norway, Benson K. Whitney, denounced the ethics system, calling it unfair, inconsistent and hypocritical.
“Norway found Wal-Mart unethical for allegedly discouraging unions, but the government’s Pension Fund stands silent about firms in its portfolio from countries in which no unions, or only state unions, are allowed,” he said in a September speech.
“Strangely enough, by this approach, the Pension Fund currently encourages unethical companies and discourages ethical ones.”
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