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DECADE: Norway Sovereign Wealth Still Views Wal-Mart as a Human Rights Violator

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Norges Bank, the overseer of Norway’s Government Pension Fund Global (GPFG), typically follows given recommendations from the Council on Ethics appointed by Norway’s Ministry of Finance when it comes to excluding companies for the sovereign wealth fund. For over a decade now, Wal-Mart Stores Inc. and Wal-Mart De Mexico SA de CV remain on the exclusion list in the category of “Serious Violations of Human Rights.” Both entities have been on the list since May 31, 2006 and make up 2 out of the 3 violators in the human rights categorization. The other company on Norway’s exclusion list via human rights is Zuari Agro Chemicals Ltd. However, the situation is different now. In 2006, Norway’s GPFG was less than US$ 250 billion in assets; today the wealth fund approaches US$ 1 trillion and has taken a more active stance on labor issues via proxy votes. Norway’s sovereign fund is the largest sovereign wealth fund in the world in terms of assets under management and one of the biggest owners of companies from a public institutional investor standpoint.

Wal-Mart’s Low Wage Overhang

Wal-Mart is the largest retailer in the United States and has been attacked by various labor groups for paying its employees very low wages, forcing many Wal-Mart “associates” to also enroll in U.S. government welfare programs to maintain a standard of living. The retailer is constantly barraged in the U.S. press over labor or linked discriminatory stories. In July 2017, 10 illegal immigrants from Mexico were found dead by U.S. authorities at a San Antonio Wal-Mart store location, in an incident related to human smuggling.

According to the Council on Ethics’ recommendation of 15 November 2005 “An extensive body of material indicates that Wal-Mart consistently and systematically employs minors in contravention of international rules, that working conditions at many of its suppliers are dangerous or health-hazardous, that workers are pressured into working overtime without compensation, that the company systematically discriminates against women in pay, that all attempts to unionise by the company’s employees are stopped, that employees are in a number of cases unreasonably punished and locked in, along with a number of other circumstances…”.

On another note, Wal-Mart is trying to compete against Amazon in the e-commerce space, fighting over consumer spenders. Wal-Mart had acquired Jet.com to enhance its online presence.

White House Nominates Heath Tarbert for CFTC Chairman

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The White House announced Heath P. Tarbert will be nominated to serve as Commissioner and Chairman of the Commodity Futures Trading Commission (CFTC). Tarbert currently serves as Assistant Secretary for International Markets at the U.S. Treasury Department. Before joining the U.S. Treasury, Tarbert was a Partner at law firm Allen & Overy. Tarbert was confirmed by the U.S. Senate for his current Treasury post at 87 (yes) to 8 (no).

Upon Senate confirmation, Tarbert’s CFTC term would start on April 14, 2019 and last for five years. Tarbert is taking over from J. Christopher Giancarlo whose term ends in April 2019. Tarbert will need a U.S. Senate confirmation to take the head CFTC post.

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KIA Could Sell Stake in North Sea Energy Business

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The Kuwait Investment Authority (KIA), through its unit Wren House Investment Management, is nearing a deal to sell a 40% stake in its North Sea energy business to JPMorgan Asset Management. In July 2018, KIA closed on a deal to acquire oil and gas pipeline firm North Sea Midstream Partners from ArcLight Capital.

More details to follow –

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Pensioenfonds PGB Hires BMO Global for Equity Protection Strategy

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Pensioenfonds PGB is a Dutch multi-sector pension fund. PGB awarded a mandate to implement a protection strategy for its €12 billion equity portfolio to BMO Global Asset Management. PGB is a €26.5 billion fund. PGB has been using BMO Global’s responsible engagement overlay since 2017.

The Chief Investment Officer of PGB is Harold Clijsen.

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