Some NOK 10bn of Norwegians’ oil-bred pension money went up in smoke after the Sovereign Wealth Fund pulled out of tobacco industry shares, reports say.
The SWF, criticised for using tax havens, double standards, and nuclear weapons industry investments, performs a constant balancing act when it comes to moneymaking and ethics.
The NOK 9.6 billion dividends loss (roughly USD 1.59bn/EUR 1.16bn/GBP 956.54m at today’s ROE) concerns the August 2005-November 2011 period, according to Norges Bank’s calculations.
Staff at the financial institution came to their approximate conclusion by comparing shares the SWF jettisoned against a global stock index, writes regional paper Bergens Tidende.
The SWF’s portfolio value suffered an 8.8pst loss during 2011. The value increased about 18pst the following year.
Paal Bjørnestad, Deputy Minister of Finance for the Progress Party (FrP), stated political involvement via the SWF “can be terribly expensive”, as “we’ve no idea what such a policy will cost in advance”.
Centre-Right coalition government partner Hans Olav Syversen, the Christian Democrats’ leader of the Parliamentary Standing Committee on Finance and Economic Affairs commented that profit is not the sole concern.
“It’s the Norwegian People who own the Fund. We’ve got rules regarding child labour, human rights, and the working environment. We have to weigh risk, responsibility, and profit,” he said to the paper.
Property investor the SWF has announced intentions of a more than twofold increase in its equities team industry specialists.