Norges Bank Investment Management (NBIM), the manager of Norway’s giant sovereign wealth fund, divested 73 companies in 2015, including 27 coal-related companies and nine mining-related firms.
The details of its divestments are included in NBIM’s second-ever responsible investment report released today. In the last four years, NBIM has divested from a total of 187 companies. It expanded its risk analyses in 2015 to look more closely at social and governance issues relating to health, safety and the environment, human capital and corruption.
The report also shows that it has invested 53.8bn kroner in listed equities through environmental-related mandates since starting the strategy in 2009, with top holdings including Tesla Motors and the UK’s National Grid.
The investments are spread across 224 companies and the equity portfolios in aggregate returned 1.1% in 2015, and since inception in 2010 annualised return has been 2.8%. Some 19.3bn kronor of the environmental-related mandates are managed externally, and 34.5bn kroner are managed internally.
For the internal investment mandates, NBIM has a framework which aids it in the definition of theenvironmental investment universe, and in portfolio construction. It says the portfolio has a higher risk than the wider equity market: “The environmental investment universe is still nascent and sensitive to the development of new technologies, business models and government regulation.”
For a company to be included in its environmental portfolio, it needs to pass a positive screening that requires at least 20% of its business in one or more of its defined environmental segments.
Elsewhere, during 2015, NBIM voted at 11,562 shareholder meetings globally. It voted in line with the board’s recommendation on 92% of these resolutions. Of the resolutions voted against management recommendation, 61% related to the election of directors.
“In 2015, we began publishing our voting intentions in advance in selected cases, together with the reasoning behind them,” said Yngve Slyngstad, CEO of NBIM. “The aim is to be clear about what we expect and where we stand.” Also, NBIM held 3,520 meetings with companies in 2015. Priority themes included, board nominations and elections, corporate reform and sustainability. Link