Norway Oil Fund Sells out of Anglo American and Glencore on Environmental Grounds
Norges Bank Investment Management, the arm of Norway's
central bank that manages the country's oil fund, said early Wednesday it has
sold its shares in Glencore PLC, Anglo American PLC, RWE AG, Sasol Ltd., and
AGL Energy Ltd. based on its criteria relating to the use of coal.
The fund last year introduced stricter rules surrounding its
investments in companies that derive income from coal. The new guidelines mean
it must now exclude companies from the fund that derive at least 30% of their
income from thermal coal, base at least 30% of their operations on thermal
coal, extract more than 20 million tons of thermal coal per year, or have a
coal power capacity of more than 10,000 megawatts from thermal coal.
The fund held a 2.4% stake in Anglo American, 1.2% in
Glencore and 0.6% in RWE at the end of 2019, the most recent date that data is
available.
Based on these same rules, the oil fund has placed BHP Group
Ltd./BHP Group PLC, Vistra Energy Corp., Enel SpA and Uniper SE on an observation
list.
The oil fund's policy is to sell its stake in companies
before announcing their exclusion.
In a further move, Norges Bank's executive board has decided
to exclude Canadian Natural Resources Ltd., Cenovus Energy Inc., Suncor Energy
Inc., and Imperial Oil Ltd. on unacceptable levels of greenhouse gas emissions.
ElSewedy Electric Co. has been excluded on environmental
grounds amid its participation in the development of a hydropower project in
Tanzania, and Vale SA is excluded as a result of repeated dam breaches.
Centrais Eletricas Brasileiras SA, or Eletrobras, has been
excluded amid human rights violations in connection with the development of the
powerplant Belo Monte in Brazil.
Decisions to exclude some of these companies was made a
while ago but selling out of the companies took longer than usual due to the
current market situation including thin liquidity in individual shares.
Norges Bank has decided to revoke the exclusion of AECOM,
after it discontinued its connection to nuclear weapon production, and Texwinca
Holdings Ltd., after a subsidiary suspected of breaching workers' rights in
factories was liquidated.
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