Norwegian Global Fund’s environmental assets exceed €3bn

Giant investor now has nine environmental mandates

The NOK3trn (€385bn) Norwegian Government Pension Fund says it now has more than NOK25bn (€3.2bn) in environmental assets under management – up from NOK7bn a year ago.
“The number of environmental mandates increased to nine at the end of 2010 from four a year earlier,” Norges Bank Investment Management, the arm of the central bank which runs the fund, said in its 2010 annual report released today.
“The assets under management rose to NOK25.7bn from NOK7.3bn.”
Three of the nine mandates were for investments in water management, another three relate to environmental technology while three were for investments in clean energy.
NBIM has awarded environmental mandates to internal and external managers since 2009, stressing that they are “subject to the same profitability requirements” as its other investments.
“They also tie in well with the fund’s role as a responsible investor, which includes safeguarding long-term financial returns through sustainable economic, environmental and social development,” NBIM states.
Meanwhile, NBIM revealed that its suppliers of votingservices voted incorrectly on its behalf at 228 out of a total of 10,948 company meetings, with 502 incorrect votes cast at 93,011 resolutions.

“To prevent such errors from being repeated, we reviewed the processes, systems and contracts at both NBIM and our suppliers and made changes,” it said. Norges uses the electronic voting platform of MSCI’s ISS (Institutional Shareholder Services) which sends voting instructions to custodian JP Morgan.
There were also five “minor breaches” of Ministry of Finance guidelines in 2010 – where NBIM by mistake “came to possess” securities from excluded companies.
During the year NBIM filed shareholder proposals in favour of independent chairs at five US companies.
Although none of the proposals won a majority vote, four won more support than they did in 2009. It filed class actions claims in around 50 different cases, including one in the Netherlands, and received more than $7.7m as a result of previous claims.
The report also reveals that NBIM has hired a global accountancy firm to perform independent evaluations of assets managers’ “background, reputation and integrity”. Link to report