Norway’s Norges Bank, which manages the country’s $1.9 trillion sovereign wealth fund, announced it has divested from all 11 Israeli companies in which it was invested, but that were not part of its equity index benchmark, “due to unacceptable risk of contribution to serious norm violations associated with business operations in the West Bank.”
“These measures were taken in response to extraordinary circumstances,” Norges Bank CEO Nicolai Tangen said in a statement. “The situation in Gaza is a serious humanitarian crisis. We are invested in companies that operate in a country at war, and conditions in the West Bank and Gaza have recently worsened.”
The fund, the Government Pension Fund Global, in early August “completely sold out” of its investments in Israeli companies that were not in the benchmark. As of the end of the first half of the year, the GPFG had been invested in 61 Israeli companies, which has now been reduced to 50.
According to the GPFG, since 2020, it has been in contact with more than 60 companies regarding ”risk management related to conflict zones and respect for human rights,” and 39 of those dialogues were related to the West Bank and Gaza. In fall 2024, about one year after the current round of hostilities was initiated by a Hamas attack, Norges Bank “further intensified the monitoring of our investments in Israeli companies” and sold its investments in several Israeli companies.
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Tangen said the bank will “strengthen our due diligence”: “We have long paid particular attention to companies associated with war and conflict,” Tangen said, adding that “we constantly monitor companies’ risk management related to conflict zones and respect for human rights.”
In the past, Norges has divested from companies doing business with countries potentially associated with human rights violations, including companies contributing to Russia’s invasion of Ukraine.
Norges Bank also stated that external management of interests in Israeli companies will be moved in-house and that it is terminating contracts with external managers in Israel. It added that it has also “expanded our information-sharing with the Council on Ethics on Israeli companies.”
In addition to the divestments, Norway’s Ministry of Finance has asked Norges Bank to review all Israeli investments in the sovereign wealth fund’s portfolio and “to possibly propose new measures,” the Finance Ministry said in a statement.
“We have initiated the review and are in close dialogue with the Council on Ethics and have meetings with the Ministry of Finance,” Norges stated . “We will formally respond to the Ministry’s letter as soon as possible and before the deadline,” which is August 20.
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Tags: Divestment, Israel, Norges Bank Invesment Management, Norway Government Pension Fund Global
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