Norwegian Ethics Council Chair Mestad Cautions on Insincere ESG Compliance
Currently, Ola Mestad is the chair of the Council on Ethics for Norway’s Government Pension Global (GPFG) and a professor of law at the University of Oslo. It has been reported that Ola Mestad is not as enthusiastic about the efficacy of Norway’s sovereign wealth fund in recent days, specifically its responsible investment criteria.
The ethics council has a list of companies to be excluded from the sovereign wealth fund’s investment universe. Some of the companies on the exclusion list include Fortune 500 companies like Lockheed Martin Corporation, Northrop Grumman Corporation, Wal-Mart Stores and Boeing Co. In addition, a number of excluded companies have substantial public funds as investors such as Rio Tinto Plc and Potash Corporation of Saskatchewan.
He said he “gets the feeling” that companies aren’t actually following through on their guidelines.
In a speech to attendees of the Ethical Investment Research and Investment Service’s (EIRIS) 30th anniversary conference in London yesterday, Mr Mestad was quoted as saying that the success of their responsible investing program makes it “superficial” in a way.
According to Mestad when Norway’s oil fund began their responsible investing criteria, they weren’t taken very seriously. Recently that has changed with public companies responding immediately to the giant institutional investor whenever it raises issues concerning the ethics of their operations.
In April of this year, Norway’s sovereign fund began divesting itself from oil companies with operations in Equatorial Guinea. [Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view site content.]
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