Karin Smith Ihanacho, director of governance and compliance, said after the publication of the list of 15 companies excluded from the fund’s portfolio in 2020 that we have no additional plans to exit fossil fuels.
“Part of the assessment is that the owners of large, integrated energy companies must contribute as owners to make a positive change to the low-carbon community.”
The Oslo-based Sovereign Sovereign Fund, the world’s largest sovereign wealth fund, generated $ 123 billion in revenue last year, marking the second-best performance ever.
However, the biggest losses were related to positions in oil companies and exits from shares focused on commodity exploration and production. At the same time, CEO Nicolai Tangen made it clear that he wants to focus on sustainability.
The fund said it exempted 15 of its portfolios last year on the basis of ethical standards ranging from human rights violations to serious environmental damage. The fund excluded 32 other companies that could not be identified based on their assessment of environmental, social and administrative risks.
It holds 1.5% of the funds of all the companies listed globally, and 311 in 2019 invested in 225 companies in the oil and gas sector. The fund says Royal Dutch Shell and BP performed the worst.
Ihanacho said while the fund wants investing companies to have clear emission reduction targets, it has not explicitly called for it to be carbon neutral by 2050. The goals of the companies still need to be aligned with the Paris Agreement and the fund will focus on the companies ’plans to achieve the goals, he said in an interview.
“Our expectations are anchored to ‘zero’ by 2050,” Ihanacho said. “It’s important to understand how companies believe they will get there. It is one thing to say that by 2050 they should be zero. We are concerned with short, medium and long term goals. We believe this is equally important. ”
Here is the full list of 2020 exemptions:
- AGL Energy
- Anglo American
- Elsevedi Electric
- Canadian Natural Resources
- Xenovus Energy
- Imperial oil
- Suncore Energy
- Brazilian Power Plants
- Formosa Chemicals & Fiber
- Formosa taffeta
- Page industries
Previous exclusions from Drax Group, Aicom and Texwinka Holdings have been canceled, and four companies, including BHP, are now on a watch list.
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